[Today's Guide]
>Online off-market financing closed, value exploration agreed by market
>Military qualification to decontrolled, civil-participation-in-military market to see improvement opportunities
>2015 World Mobile Congress ongoing, intelligent automobile concerned
>BGRIMM Magnetic Materials and Xinhua Commercial through secondary market acquisition to 5 percent limit, Daheng New Epoch Technology sees shareholding increases
[XFA Focus]
○Online off-market financing closed, value exploration agreed by market
------
Following Hundsun Technologies Inc. (600570.SH) which announced shutdown of new account opening and capital increase functions of HOMS system during morning session of July 16, Shanghai Mecrt Corporation and Hithink RoyalFlush Information Network Co., Ltd. (300033.SZ), another two software providers, indicated that they had adopted the same move in that same afternoon. As learnt by XFA, Hithink RoyalFlush Information Network, which has the least number of accounts, has almost completed the clearance, while Hundsun Technologies is waiting for the following documents from authorities to gradually standardize the rest accounts.
Comment: It means that the channels of online off-market financing are cut technically. Authorities pledge to prevent sharp surge/slump brought by highly-leveraged capital and do not deal with all rest accounts with rigid uniformity, so the short-term impact faced by market capital will be quite limited. After the stock index dropped by around 30 percent from its highest, short-term capital favoring stocks telling stories or heavily speculating themes decreases to some extent, while more share acquisition through secondary market acquisition to the five percent limit and investigation in listed companies emerge. Value exploration becomes the focus of various capitals. Stocks bought through secondary market acquisition to the five percent limit are those small-cap stocks with market value around 2~3 billion yuan and intentions for transformation; listed companies being investigated are mainly those engaged in emerging industries and seeing improving performance.
[XFA Selection]
○Overseas investment of China’s manufacturing industry sees a year-on-year growth of 63 percent in the first half year. The “going out” strategy of international capacity cooperation and equipment manufacturing industry achieves obvious progress.
○The Ministry of Transport on July 16 indicated that the “Integrated Transport Planning for Beijing-Tianjin-Hebei Coordinated Development” will be distributed recently to push ahead with the construction of highway and ports.
○Yang Jiacai, Assistant of the director of China Banking Regulatory Commission, recently visited Suning Consumer Finance Company and indicated that “quality companies will be supported, while poor quality companies will be controlled” so as to press ahead with the development of consumer finance industry.
○Driverless automobile jointly developed by China Vanke Co., Ltd. and Shanghai Jiao Tong University is on trial. The automobile acquires magnetic signal on the road via magnetic sensor.
○The world first liquid metal cellphone will be sold in the U.S. on August 10. The hardness of its material exceeds that of titanium alloy and steel.
[Industry Information]
○China to expand opening of military industry, civil-participation-in-military market to see improvement opportunities
------
Xu Dazhe, head of the State Administration of Science, Technology and Industry for National Defense, indicated on the military-civil integration development forum held on July 16 that the opening of military industry will be expanded; new-version of weaponry scientific research and production list will be released; control over market entry will be relaxed; permit management scope will be defined properly and narrowed gradually; products that can be adjusted by market and have no big impact on national secret security and social public security will be decontrolled; quality social resources will be absorbed into weaponry scientific research, production and maintenance areas. The new permit list will reduce over 60 percent of original permit list.
Comment: At present, the formulation of the military-civil integration plan for the Science and Technology Industry of National Defense has been kicked off. Development goal, entry points, supporting policies, etc. will be further specified. Under the promotion of gradual opening in military area and the improvement of civil enterprises’ technical level, civil-participation-in-military market will see improvement opportunities. Among A share companies, Anhui Yingliu Electromechanical Co., Ltd. (603308.SH) joins hands with China Academy of Engineering Physics to develop the industrialization of neutron absorbing material and they will benefit from the increasing demand of nuclear waste market; Integrated Electronic Systems Lab Co., Ltd. (002339.SZ) makes key planning in civil-participation-in-military business. It has jointly set up a merger & acquisition fund of 1.5 billion yuan in military industry with Beijing Jiuyuan Commerce Company Limited to carry out concentrated investment in military informatization area.
○2015 World Mobile Congress ongoing, intelligent automobile concerned
------
XFA learns from the ongoing World Mobile Congress that intelligent automobile becomes the focus of the congress. Volvo launches Sensus intelligent car interaction system and makes field demonstration of remote control through the APP on Apple Watch. In addition, “intelligent automobile industrial alliance” was established in Shenzhen recently. It is expectable that intelligent automobile will be an important development trend of automobile industry in the future.
Comment: As predicted by institutions, the intelligent automobile industrial size will reach 150 billion yuan in 2015, indicating a promising industrial prospect. Among listed companies, QiMing Information Technology Co., Ltd. (002232.SZ) actively makes planning in car networking. It has achieved interaction between machine data and artificial data; CenNavi Technologies Co., Ltd. under Navinfo Co., Ltd. (002405.SZ) is one of the leading enterprises in China’s dynamic traffic information area. Users’ increasing demand on precise travelling will contribute to the company’s rapid income growth in this area.
[Announcement Interpretation]
○BGRIMM Magnetic Materials, Xinhua Commercial and Tibet Tourism through secondary market acquisition to 5 percent limit
------
Zhongke Huitong (Shenzhen) Equities Investment Fund Co., Ltd., a company under China Science & Merchants Investment Management Group (CSC), increased the shareholding in BGRIMM Magnetic Materials & Technology Co., Ltd. (600980.SH) by 6,566,000 shares at an average price of 19.97 yuan on July 15, accounting for 5.05 percent of the total share capital. Zhongke Huitong holds 10.06 percent shares of the company after the increase in shareholding and became the second biggest shareholder of the company. As a PE behemoth in China, the CSC is to facilitate the industrial upgrading and transformation of the target company by purchasing its shares through secondary market acquisition to the 5 percent limit.
Shanghai Baoyin Chuangyin Investment Management Co., Ltd., a company under the well-known private fund manager Cui Jun, and its persons acting in concert bought shares of Yinchuan Xinhua Commercial (Group) Co., Ltd. (600785.SH) through secondary market acquisition to the 5 percent limit for four times. They currently hold 20 percent shares of the company. The position building for the shareholding increase took place on July 14 and 15 with an average price of about 23.9 yuan.
Hu Bo, a shareholder of Tibet Tourism Co., Ltd. (600749.SH), and Hu Biao, one of his persons acting in concert, bought 12.28 million shares of the company on July 15, accounting for 6.49 percent of the share capital. Hu Bo and Hu Biao totally hold 18,137,000 shares after the shareholding increase, accounting for 9.59 percent of the share capital. They indicate that they intend to hold them for long term to obtain value-added income. Guofeng Group, a substantial shareholder of Tibet Tourism, holds 16.1 percent shares of the company.
○Companies see shareholding increases, including Daheng New Epoch Technology
------
Zheng Suzhen, the actual controller of Daheng New Epoch Technology, Inc. (600288.SH), increased the shareholding in the company with 698,800 shares on July 16, accounting for 0.16 percent of the share capital. Zheng is Xu Xiang’s mother and Xu is the Zexi Investment. Luo Xudong, the controlling shareholder of Changsha Kaiyuan Instruments Co., Ltd. (300338.SZ), increased the shareholding in the company with 410,000 shares, accounting for 0.16 percent of the share capital. Holley Group, a shareholder of Zhejiang Huamei Holding Co., Ltd. (000607.SZ), increased the shareholding in the company with 1.4 million shares at average price of 10.45 yuan, accounting for 0.14 percent of the share capital. Jiao Yun Group, the controlling shareholder of Shanghai Jiao Yun Group Co., Ltd. (600676.SH), increased the shareholding in the company with 1 million shares, accounting for 0.116 percent of the share capital. Certain senior management of Integrated Electronic Systems Lab Co., Ltd. (002339.SZ) increased the shareholding in the company with 424,300 shares, accounting for 0.11 percent of the share capital. Zhejiang Longxin Equities Investment Management Co., Ltd., a shareholder of Wolong Electric Group Co., Ltd. (600580.SH), increased the shareholding in the company with 1.2 million shares, accounting for 0.108 percent of the share capital.
In addition, Shanghai Enlight Investment Holdings Co., Ltd., the controlling shareholder of Beijing Enlight Media Co., Ltd. (300251.SZ), increased the shareholding in the company with 450,000 shares on July 16, accounting for 0.03 percent of the share capital. It increased the shareholding in the company with 680,000 shares on May 7, accounting for 0.06 percent of the share capital. The share prices in the two shareholding increases were about 22 yuan. According to its plan, Enlight Investment will increase the shareholding in the company with no more than 11.28 million shares.
○Yintai Resources to repurchase with no more than RMB16 per share
------
Yintai Resources Co., Ltd. (000975.SZ) proposes to repurchase 3,125,000 shares at no more than 16 yuan per share with no more than 50 million yuan, accounting for 0.29 percent of its share capital. The effective period will be one month from reporting the China Securities Regulatory Commission (CSRC) for filing and approval. The share of the company closed at 15.21 yuan before trading suspension.
[Financial Reports Express]
○Yangjie Electronic Technology proposes high share conversion
------
Yangzhou Yangjie Electronic Technology Co., Ltd. (300373.SZ) proposes a 15-for-10 conversion of capital surplus into shares according to the proposal for the share distribution in the first half.
○Ningbo Shanshan expects performance to surge
------
Ningbo Shanshan Co., Ltd. (600884.SH) expects its net profit to increase 380 percent to 430 percent year on year according to its half-year report thanks to investment revenue of 600 million yuan. Tongkun Group Co., Ltd. (601233.SH) expects its net profit to be 300 million yuan to 360 million yuan according to its half-year report, compared with a loss of 29.85 million yuan in the corresponding period of last year. It is mainly attributed to the research and development of products with high added value. Everbright Securities Company Limited (601788.SH) expects its net profit in the first half to be 12.5 times to 13 times of those in the same period of last year as a result of a continuous booming capital market and more transactions in the first half.
[Data Speaks]
○Four institutes buy Fuanna Bedding and Furnishing, cross-industry to boost future development
------
The trading volume ranking list on July 16 shows that four institutes bought Shenzhen Fuanna Bedding and Furnishing Co., Ltd. (002327.SZ) with 238 million yuan, accounting for 28 percent of its intraday turnover. An institute contributed about 200 million yuan and no institute sold out.
Comment: The company introduced plans on repurchase and shareholding increase by substantial shareholder after it resumed trading on July 14. Based on the lower limit of the performance estimate in the first half, the current dynamic P/E ratio of the company is 26 times. The research reports of institutes believe that the company made the first step in flexible investment by investing in Shenzhen High-Tech Investment Venture Capital Co., Ltd. The futures drivers of the company will be the gradual implementation of the expectations on the Internet plus, intelligent big housing industry and the supply chain-based finance.
>Online off-market financing closed, value exploration agreed by market
>Military qualification to decontrolled, civil-participation-in-military market to see improvement opportunities
>2015 World Mobile Congress ongoing, intelligent automobile concerned
>BGRIMM Magnetic Materials and Xinhua Commercial through secondary market acquisition to 5 percent limit, Daheng New Epoch Technology sees shareholding increases
[XFA Focus]
○Online off-market financing closed, value exploration agreed by market
------
Following Hundsun Technologies Inc. (600570.SH) which announced shutdown of new account opening and capital increase functions of HOMS system during morning session of July 16, Shanghai Mecrt Corporation and Hithink RoyalFlush Information Network Co., Ltd. (300033.SZ), another two software providers, indicated that they had adopted the same move in that same afternoon. As learnt by XFA, Hithink RoyalFlush Information Network, which has the least number of accounts, has almost completed the clearance, while Hundsun Technologies is waiting for the following documents from authorities to gradually standardize the rest accounts.
Comment: It means that the channels of online off-market financing are cut technically. Authorities pledge to prevent sharp surge/slump brought by highly-leveraged capital and do not deal with all rest accounts with rigid uniformity, so the short-term impact faced by market capital will be quite limited. After the stock index dropped by around 30 percent from its highest, short-term capital favoring stocks telling stories or heavily speculating themes decreases to some extent, while more share acquisition through secondary market acquisition to the five percent limit and investigation in listed companies emerge. Value exploration becomes the focus of various capitals. Stocks bought through secondary market acquisition to the five percent limit are those small-cap stocks with market value around 2~3 billion yuan and intentions for transformation; listed companies being investigated are mainly those engaged in emerging industries and seeing improving performance.
[XFA Selection]
○Overseas investment of China’s manufacturing industry sees a year-on-year growth of 63 percent in the first half year. The “going out” strategy of international capacity cooperation and equipment manufacturing industry achieves obvious progress.
○The Ministry of Transport on July 16 indicated that the “Integrated Transport Planning for Beijing-Tianjin-Hebei Coordinated Development” will be distributed recently to push ahead with the construction of highway and ports.
○Yang Jiacai, Assistant of the director of China Banking Regulatory Commission, recently visited Suning Consumer Finance Company and indicated that “quality companies will be supported, while poor quality companies will be controlled” so as to press ahead with the development of consumer finance industry.
○Driverless automobile jointly developed by China Vanke Co., Ltd. and Shanghai Jiao Tong University is on trial. The automobile acquires magnetic signal on the road via magnetic sensor.
○The world first liquid metal cellphone will be sold in the U.S. on August 10. The hardness of its material exceeds that of titanium alloy and steel.
[Industry Information]
○China to expand opening of military industry, civil-participation-in-military market to see improvement opportunities
------
Xu Dazhe, head of the State Administration of Science, Technology and Industry for National Defense, indicated on the military-civil integration development forum held on July 16 that the opening of military industry will be expanded; new-version of weaponry scientific research and production list will be released; control over market entry will be relaxed; permit management scope will be defined properly and narrowed gradually; products that can be adjusted by market and have no big impact on national secret security and social public security will be decontrolled; quality social resources will be absorbed into weaponry scientific research, production and maintenance areas. The new permit list will reduce over 60 percent of original permit list.
Comment: At present, the formulation of the military-civil integration plan for the Science and Technology Industry of National Defense has been kicked off. Development goal, entry points, supporting policies, etc. will be further specified. Under the promotion of gradual opening in military area and the improvement of civil enterprises’ technical level, civil-participation-in-military market will see improvement opportunities. Among A share companies, Anhui Yingliu Electromechanical Co., Ltd. (603308.SH) joins hands with China Academy of Engineering Physics to develop the industrialization of neutron absorbing material and they will benefit from the increasing demand of nuclear waste market; Integrated Electronic Systems Lab Co., Ltd. (002339.SZ) makes key planning in civil-participation-in-military business. It has jointly set up a merger & acquisition fund of 1.5 billion yuan in military industry with Beijing Jiuyuan Commerce Company Limited to carry out concentrated investment in military informatization area.
○2015 World Mobile Congress ongoing, intelligent automobile concerned
------
XFA learns from the ongoing World Mobile Congress that intelligent automobile becomes the focus of the congress. Volvo launches Sensus intelligent car interaction system and makes field demonstration of remote control through the APP on Apple Watch. In addition, “intelligent automobile industrial alliance” was established in Shenzhen recently. It is expectable that intelligent automobile will be an important development trend of automobile industry in the future.
Comment: As predicted by institutions, the intelligent automobile industrial size will reach 150 billion yuan in 2015, indicating a promising industrial prospect. Among listed companies, QiMing Information Technology Co., Ltd. (002232.SZ) actively makes planning in car networking. It has achieved interaction between machine data and artificial data; CenNavi Technologies Co., Ltd. under Navinfo Co., Ltd. (002405.SZ) is one of the leading enterprises in China’s dynamic traffic information area. Users’ increasing demand on precise travelling will contribute to the company’s rapid income growth in this area.
[Announcement Interpretation]
○BGRIMM Magnetic Materials, Xinhua Commercial and Tibet Tourism through secondary market acquisition to 5 percent limit
------
Zhongke Huitong (Shenzhen) Equities Investment Fund Co., Ltd., a company under China Science & Merchants Investment Management Group (CSC), increased the shareholding in BGRIMM Magnetic Materials & Technology Co., Ltd. (600980.SH) by 6,566,000 shares at an average price of 19.97 yuan on July 15, accounting for 5.05 percent of the total share capital. Zhongke Huitong holds 10.06 percent shares of the company after the increase in shareholding and became the second biggest shareholder of the company. As a PE behemoth in China, the CSC is to facilitate the industrial upgrading and transformation of the target company by purchasing its shares through secondary market acquisition to the 5 percent limit.
Shanghai Baoyin Chuangyin Investment Management Co., Ltd., a company under the well-known private fund manager Cui Jun, and its persons acting in concert bought shares of Yinchuan Xinhua Commercial (Group) Co., Ltd. (600785.SH) through secondary market acquisition to the 5 percent limit for four times. They currently hold 20 percent shares of the company. The position building for the shareholding increase took place on July 14 and 15 with an average price of about 23.9 yuan.
Hu Bo, a shareholder of Tibet Tourism Co., Ltd. (600749.SH), and Hu Biao, one of his persons acting in concert, bought 12.28 million shares of the company on July 15, accounting for 6.49 percent of the share capital. Hu Bo and Hu Biao totally hold 18,137,000 shares after the shareholding increase, accounting for 9.59 percent of the share capital. They indicate that they intend to hold them for long term to obtain value-added income. Guofeng Group, a substantial shareholder of Tibet Tourism, holds 16.1 percent shares of the company.
○Companies see shareholding increases, including Daheng New Epoch Technology
------
Zheng Suzhen, the actual controller of Daheng New Epoch Technology, Inc. (600288.SH), increased the shareholding in the company with 698,800 shares on July 16, accounting for 0.16 percent of the share capital. Zheng is Xu Xiang’s mother and Xu is the Zexi Investment. Luo Xudong, the controlling shareholder of Changsha Kaiyuan Instruments Co., Ltd. (300338.SZ), increased the shareholding in the company with 410,000 shares, accounting for 0.16 percent of the share capital. Holley Group, a shareholder of Zhejiang Huamei Holding Co., Ltd. (000607.SZ), increased the shareholding in the company with 1.4 million shares at average price of 10.45 yuan, accounting for 0.14 percent of the share capital. Jiao Yun Group, the controlling shareholder of Shanghai Jiao Yun Group Co., Ltd. (600676.SH), increased the shareholding in the company with 1 million shares, accounting for 0.116 percent of the share capital. Certain senior management of Integrated Electronic Systems Lab Co., Ltd. (002339.SZ) increased the shareholding in the company with 424,300 shares, accounting for 0.11 percent of the share capital. Zhejiang Longxin Equities Investment Management Co., Ltd., a shareholder of Wolong Electric Group Co., Ltd. (600580.SH), increased the shareholding in the company with 1.2 million shares, accounting for 0.108 percent of the share capital.
In addition, Shanghai Enlight Investment Holdings Co., Ltd., the controlling shareholder of Beijing Enlight Media Co., Ltd. (300251.SZ), increased the shareholding in the company with 450,000 shares on July 16, accounting for 0.03 percent of the share capital. It increased the shareholding in the company with 680,000 shares on May 7, accounting for 0.06 percent of the share capital. The share prices in the two shareholding increases were about 22 yuan. According to its plan, Enlight Investment will increase the shareholding in the company with no more than 11.28 million shares.
○Yintai Resources to repurchase with no more than RMB16 per share
------
Yintai Resources Co., Ltd. (000975.SZ) proposes to repurchase 3,125,000 shares at no more than 16 yuan per share with no more than 50 million yuan, accounting for 0.29 percent of its share capital. The effective period will be one month from reporting the China Securities Regulatory Commission (CSRC) for filing and approval. The share of the company closed at 15.21 yuan before trading suspension.
[Financial Reports Express]
○Yangjie Electronic Technology proposes high share conversion
------
Yangzhou Yangjie Electronic Technology Co., Ltd. (300373.SZ) proposes a 15-for-10 conversion of capital surplus into shares according to the proposal for the share distribution in the first half.
○Ningbo Shanshan expects performance to surge
------
Ningbo Shanshan Co., Ltd. (600884.SH) expects its net profit to increase 380 percent to 430 percent year on year according to its half-year report thanks to investment revenue of 600 million yuan. Tongkun Group Co., Ltd. (601233.SH) expects its net profit to be 300 million yuan to 360 million yuan according to its half-year report, compared with a loss of 29.85 million yuan in the corresponding period of last year. It is mainly attributed to the research and development of products with high added value. Everbright Securities Company Limited (601788.SH) expects its net profit in the first half to be 12.5 times to 13 times of those in the same period of last year as a result of a continuous booming capital market and more transactions in the first half.
[Data Speaks]
○Four institutes buy Fuanna Bedding and Furnishing, cross-industry to boost future development
------
The trading volume ranking list on July 16 shows that four institutes bought Shenzhen Fuanna Bedding and Furnishing Co., Ltd. (002327.SZ) with 238 million yuan, accounting for 28 percent of its intraday turnover. An institute contributed about 200 million yuan and no institute sold out.
Comment: The company introduced plans on repurchase and shareholding increase by substantial shareholder after it resumed trading on July 14. Based on the lower limit of the performance estimate in the first half, the current dynamic P/E ratio of the company is 26 times. The research reports of institutes believe that the company made the first step in flexible investment by investing in Shenzhen High-Tech Investment Venture Capital Co., Ltd. The futures drivers of the company will be the gradual implementation of the expectations on the Internet plus, intelligent big housing industry and the supply chain-based finance.
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