[Today's Guide]
> Boeing to locate assembly plant at Zhoushan in Zhejiang province, local construction enterprises to benefit
> Reform on whole industrial chain of oil and gas launched, market-oriented reform to benefit private pipeline enterprises
> China and U.S to strengthen shale gas cooperation, domestic market expected to speed up
> VRV Software to launch private placement to expand information security, Nanning Department Store bought by Qian Hai Life Insurance through secondary market acquisition to 5 pct limit
[SSN Focus]
○Boeing to locate assembly plant at Zhoushan City in Zhejiang province, local construction enterprises to benefit
------
SSN learns that the scheme for constructing assembly plant of The Boeing Company (NYSE:BA) in Zhoushan City, Zhejiang province, has been submitted to the State Council and new progress will be reported this week at the soonest. To strive for the implementation of Boeing project, Zhoushan City has been making for preparations for it for over two years and planned Zhoushan Aviation Industrial Park. President of Boeing (China) Company also visited Zhoushan City last year. According to the scheme, this assembly plant will be located at Zhujiajian Island which enjoys the advantage of being close to both airport and port.
Comment: According to current progress, Zhoushan assembly plant might become Boeing's first plant outside the U.S., helping to involve more Chinese companies in the supply chain of Boeing's components. It is learnt that Ningbo Construction Co., Ltd. (601789.SH) will undertake the factory building of this assembly plant. The company also undertakes several projects including Ningbo-Zhoushan port wharf; Hongrun Construction Group Co., Ltd. (002062.SZ) will undertake the road project on Zhujiajian Island; Zhejiang Reclaim Construction Group Co., Ltd. (002586.SZ) has construction experience of port projects in Zhoushan City.
Top
[SSN Selection]
○Chinese Premier Li Keqiang indicated that China's financial industry will keep the overall direction to constantly deepen the reform when he met the UK Chancellor of the Exchequer on Sep. 21.
○Various policy-related agreements have been reached in the 7th UK-China Economic and Financial Dialogue to support the feasibility research on interconnection and interworking of Shanghai Stock Exchange and London Stock Exchange.
○According to report by the Bloomberg, Yang Jiechi, a State Councilor, indicated in the interview that the stock crash does not reflect the sound condition of China's economy.
○The Ministry of Housing and Urban-Rural Development of PRC issued a notice to enhance the housing fund loan transaction in places different from those, in which the housing funds are paid, to support the allopatric house-purchasing demands of the employees.
○The National Energy Administration released a document to promote the offshore wind power development, proposing to issue related provincial subsidy policies based on the grid purchase price.
[Industry Information]
○Reform on whole industrial chain of oil and gas launched, market-oriented reform to benefit private pipeline enterprises
------
SSN learns that think-tankers have proposed multiple ideas and suggestions for the reform on oil and gas. One suggestion is to push forward the fundamental change from incomplete market-oriented industrial chain to market-oriented industrial chain. According to the statement about mixed-ownership reform made by Liu He, deputy director of the National Development and Reform Commission (NDRC), the reform on oil and gas closely follows the power reform which has already been started.
Comment: The reform on oil and gas system is a key reform task already determined by decision-makers. Industrial insiders hold that the lagging behind market-oriented reform in oil and gas area as well as the declining benefit of oil and gas enterprises have impacted China's economic competitiveness. The reform must be enforced. The decontrol of the upstream and the separation of pipe and network might be central to this new round of oil and gas reform and facilitate pipe enterprises to obtain more orders. As to listed companies, Jiangsu Changbao Steeltube Co., Ltd. (002478.SZ) is an important supplier of PetroChina Company Limited (601857.SH; 00857.HK) and China Petroleum ＆ Chemical Corporation (600028.SH); the welded steel tubes for oil and gas transmission manufactured by Jiangsu Yulong Steel Pipe Co., Ltd. (601028.SH) are widely applied in the pipe network construction of PetroChina and China Petroleum ＆ Chemical.
Top
○China and U.S to strengthen shale gas cooperation, domestic market expected to speed up
------
The Fifteenth U.S.-China Oil and Gas Industry Forum was held recently in Chongqing Municipality. Zhang Yuqing, vice director of the National Energy Administration (NEA), indicated that the two countries will strengthen cooperation in the oil and gas industry and expand the practical cooperation in shale gas and other industries. The U.S. Department of Energy hopes that the two sides can strengthen cooperation in low-carbon, emission cut and shale gas areas. The U.S. representatives visited the shale gas project of China Petroleum ＆ Chemical Corporation (Sinopec, SNP.NYSE; SNP.LSE; 00386.HK; 600028.SH) in Peiling District, Chongqing.
Comment: As a major producer of shale gas in the world, the U.S. is a leader in the technology and standard. The U.S.-China cooperation in energy will help reduce the production cost of shale gas in China and accelerate the development of the domestic market. The exploration of shale gas field of Sinopec in Peiling District has made significant breakthroughs recently. PetroChina Company Limited (PTR.NYSE; 00857.HK; 601857.SH) also submitted the explored geological reserves of shale gas in Sichuan Basin for the first time. Institutes estimate that the acceleration in the development of shale gas will bring oil services and equipment enterprises with orders of 100 billion yuan. In terms of listed companies, Lanzhou Haimo Technologies Co., Ltd. (300084.SZ) and Shandong Molong Petroleum Machinery Co., Ltd. (00568.HK; 002490.SZ) have developed services for relevant equipment on shale gas development.
Top
[Announcement Interpretation]
○VRV Software to raise RMB1.5 bln through private placement to expand information security
------
Beijing VRV Software Corporation Limited (300352.SZ) proposes to raise 1.5 billion yuan by issuing 35 million shares through private placement. The proceeds will be used in new generation of Internet security aggregation channels project and the VRV (Nanjing) research and development and operation base. The former will be invested 770 million yuan to consolidate the basic network communication, information security and Internet application on a new platform, which will facilitate the company in becoming a leader in the new generation instant communication industry and the industry standard maker.
○Nanning Department Store bought by Qian Hai Life Insurance through secondary market acquisition to 5 pct limit
------
Nanning Department Store Co., Ltd. (600712.SH) announced that as at Sept. 21, Qian Hai Life Insurance Co., Ltd. holds 27.28 million shares of the company, accounting for 5.01 percent of its total share capital and reaching the 5 percent limit. The transaction price was 5.36 to 6.52 yuan per share. Qian Hai Life Insurance will continue to increase the shareholding in the company in the following 12 months. The latest close price of the company is 6.47 yuan per share. In addition, Nanning Department Store also announced that it has signed a strategic cooperation agreement with Guangzhou Cross-Border E-Commerce Co., Ltd. on joint development of cross-border e-commerce business.
○Jiangsu Zongyi to control Datang Smartcard Technology
------
Shenzhen Einolda Financial Information Co., Ltd., a subsidiary of Jiangsu Zongyi Co., Ltd. (600770.SH), proposes to acquire 60 percent equities of Beijing Datang Smartcard Technology Co., Ltd. with 96 million yuan. Datang Smartcard Technology enjoys strong advantages in the technology research and development and accounts a high proportion in the domestic telecommunication card market. It recorded a net profit of 10.05 million yuan in 2014.
○Dewei Advanced Materials and Sunyes Electronic Manufacturing to develop commercial factoring with RMB100 mln
------
Jiangsu Dewei Advanced Materials Co., Ltd. (300325.SZ) plans to invest 100 million yuan in the establishment of Suzhou Dewei Commercial Factoring Co., Ltd., a wholly-owned subsidiary, to develop supply chain finance. The company currently operates in the chemical engineering and chemical fiber industry. The expansion into the supply chain finance will bring new profit growth points.
Shenzhen Sunyes Electronic Manufacturing Holding Co., Ltd. (002388.SZ) intends to invest 100 million yuan in establishment of Shenzhen Sunyes Commercial Factoring Co., Ltd., a wholly-owned subsidiary. The company is principally engaged in electronic equipment manufacturing and its net profit has been declining significantly.
Top
Latest comments