Low valuations may make Chinese stocks a bargain, according to an article in Bloomberg. Strategists at both Goldman Sachs and JPMorgan Chase have noted that in spite of the risks around growth outlook in China, the country’s battered stocks may present an opportunity. While the Chinese equity market reflects the risks stemming from strict pandemic policies and tightening regulations, JPMorgan upgraded China’s stocks with expectations of a major rebound next year.

A crackdown on big tech companies, a slump in the real estate sector and a sluggish economy drove the MSCI China index down 21% this year, in contrast to the U.S. and European benchmarks that soared to new records. But strategists point to this as a good entry point to buy in at bottom-third prices. “We still see a lot of opportunity,” Bloomberg quotes Luke Barrs, head of fundamental equity client portfolio management in EMEA for Goldman Sachs Asset Management, “and have an underlying view that there’s space for successful, profitable private sector enterprise in China.”