[Today's Guide]
>Largest-ever acquisition case in IT industry falls on data storage, growth prospect to expected
>Agricultural modernization becomes key in 13th Five-Year Plan, agricultural e-commerce to see more policy support...
>PV industry sees reassuring polices, profits likely to continue to grow
>Nationz Technologies and etc. see large performance growth, Baolihua New Energy Stock bought by CSF and Central Huijin
[SSN Focus]
○Largest-ever acquisition case in IT industry falls on data storage, growth prospect to expected
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The Reuters reports that Dell Inc. (NASDAQ:DELL) plans to acquire EMC Corporation (NYSE: EMC), a global giant in data storage, with 67 billion U.S. dollar at 33.15 U.S. dollar per share through cash and special stocks, making the case the largest-ever acquisition in global IT market. EMC's stock price surged over 29 U.S. dollar per share during the pre-market trading on Oct. 12 and it saw a total surge around 20 percent since this month. Analysts believe that Dell is gradually moving towards more profitable storage and security areas from hardware business including personal computer.
Comment: The integration of information technology, economy and society initiates rapid growth of data. Big data is widely applied in various areas now. Data storage industry, connected with data industry, is also highly concerned by various capitals. Not long ago, Tsinghua Unigroup acquired 15 percent equities of Western Digital Corporation (NASDAQ:WDC) with 3.8 billion U.S. dollar. Toyou Feiji Electronics Co., Ltd. (300302.SZ), a leading domestic cloud data storage company, recently announced a performance forecast of 180 to 200 percent in the first three quarters and its stock price soared to the daily 10 percent limit at the sound of the announcement. As to other companies, Shenzhen Kaifa Technology Co., Ltd. (000021.SZ) is the world's second largest manufacturer of the magnetic read head for hard disc; Netac Technology Co., Ltd. (300042.SZ) owns many patents in data storage and data processing systems; Beijing Teamsun Technology Co., Ltd. (600410.SH) owns self-developed storage product "Feijieqingyun".
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[SSN Selection]
○The CPC Central Committee Political Bureau on Oct. 12 convened a meeting on the 13th five-year plan and decided to convene the Fifth Plenary Session of the 18th Communist Party of China Central Committee from Oct. 26 to 29.
○The National Development and Reform Commission (NDRC) issued the Outline on the Regional Cooperation Plan on Adjacent Areas of the Government of the People's Republic of China and the Kyrgyz Republic. Both countries will jointly promote the comprehensive and coordinated development of adjacent areas including Xinjiang Uygur Autonomous Region.
○Officials from the National Energy Administration revealed that China has arranged billions of funds for the construction of charging infrastructure. The State Grid Corporation of China increased its annual investment amount from 1 or 2 billion yuan to over 5 billion yuan.
○SSN learnt that the revised draft of irrigation and water conservancy rules will be published soon. The revised draft encourages the spread of water saving irrigation technologies of high efficiency, such as sprinkler irrigation and micro-irrigation are encouraged.
○A technical manager from a Russian high speed railway company said in an interview with CCTV that they are expecting to conduct joint production of EMU train with China in the future.
[Industry Information]
○Agricultural modernization becomes key in 13th Five-Year Plan, agricultural e-commerce to see more policy supports
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SSN learns that driven by the "Internet plus" strategy, agricultural e-commerce, as an important part of agricultural modernization, will see rapid development and receive further policy support. Chinese President Xi Jinping pointed out in May that China should make breakthroughs in accelerating agricultural modernization during the Thirteenth Five-Year Plan period. The Ministry of Commerce also indicated that it would enhance policy support for agricultural e-commerce, especially in the logistics distribution of agricultural products and the link between agricultural information platforms and supermarkets.
Comment: As the year end is approaching, the agricultural sectors will ride a rally on the expectations for the CPC Central Committee's rural working conference and its No. 1 document. Shenzhen Agricultural Products Co., Ltd. (000061.SZ) is a leader in the wholesale market of agricultural products in China. It is now vigorously expanding agricultural supporting businesses, such as supply-chain finance, food safety inspection and cold chain storage, and e-commerce business. Yonghui Superstores Co., Ltd. (601933.SH) ranks top in the industry in terms of link between farmers and supermarkets. It proposes to introduce JD.com Inc. (NASDAQ:JD) as a strategic investor.
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○PV industry sees reassuring polices, profits likely to continue to grow
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An official of the National Energy Administration (NEA) indicated on the 2015 China Photovoltaic Leaders' Summit hold on Oct. 12 that the subsidies will not be canceled for the photovoltaic (PV) industry in the following eight to ten years, and the problems of subsidy default and power restriction will be solved. The Secretary-General of China Photovoltaic Industry Association noted on the summit that the newly-increased installed PV capacity has surged about 177 percent year on year in the first three quarters this year, and the profits for PV enterprises have also remarkably improved.
Comment: Whether the PV industry will constantly receive fiscal subsidies has always attracted close attention. Chinese President Xi Jinping has made solemn commitments on China's target for carbon emissions reduction during his visit to the U.S. last month, suggesting that the PV and other new energies will continue to grow. The NEA's comments have reassurance the PV industry that the industry will certainly continue to grow. Tianjin Zhonghuan Semiconductor Co., Ltd. (002129.SZ) recently revised up its performance forecast. Its net profit of the first three quarters will exceed the entire profit last year. The company's PV project cooperated with Apple Inc. (NASDAQ:AAPL) will soon be combined to the grid. Jiangsu Linyang Electronics Co., Ltd. (601222.SH) proposes to invest the research and development project on the core technologies for intelligent distributed energy resource management through private placement.
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[Financial Reports Express]
○Nationz Technologies and others to see surge in performance
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Nationz Technologies Inc. (300077.SZ) is expected to enjoy a year-on-year growth of 1,122 percent to 1,150 percent in nets profits in the first quarters of the year, which is mainly contributed by increase in revenues, decline in expenses, causing return on investment to rise. Due to surge in sales revenues, net profits of Hithink RoyalFlush Information Network Co., Ltd. (300033.SZ) are predicted to grow by 1,800 percent to 2,300 percent from a year early.
Net profits of Honyu Wear-Resistant New Materials Co., Ltd. (300345.SZ) are expected to climb by 1,600 percent to 1,799 percent year on year in the first quarters, mainly resulting from good performance of its subsidiary and decrease in raw material prices. Jiangsu Wutong Communications Co., Ltd. (300292.SZ) is expected to see a year-on-year increase of 274 percent to 300 percent in net profits at the same time owing to the consolidated statements with Guodu Interconnection and AdIn Media.
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[Announcement Interpretation]
○Baolihua New Energy Stock and others bought by CSF and Central Huijin
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The Q3 report of Guangdong Baolihua New Energy Stock Co., Ltd. (000690.SZ) shows that Central Huijin Investment Ltd. holds 3.9 percent equities of the company and ten asset management plans of China Securities Finance Corporation Limited (CSF) hold 1.16 percent equities of the company. According to the Q3 report of Yantai Tayho Advanced Materials Co., Ltd. (002254.SZ), the asset management plans of CSF and Central Huijin take 4.25 percent and 1.03 percent equity in the company respectively. It can be learnt from the company's interim report that the two companies bought shares of Tayho Advanced Materials in the third quarter.
In addition, the Q3 report of Tianshui Zhongxing Bio-technology Co., Ltd. (002772.SZ) reveals that the Central Huijin and four asset management plans of CSF hold 0.27 percent and 0.08 percent equity in the company. Zhejiang Juhua Co., Ltd. (600160.SH) reveals in its Q3 report that the CSF owns 17.9 million shares in the company, accounting for 0.99 percent of the total share capital.
○Hybio Phar. to buy equity of General Healthy to engaged in pharmacy automation
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Hybio Pharmaceutical Co., Ltd. (300199.SZ) plans to purchase 15 percent equity of General Healthy at 84 million yuan. General Healthy, a famous solution provider of medical treatment and healthcare information technology service in China, owns nearly 200 large hospital clients and is going to buy 51 percent equity of Willach (Shanghai) Medical Equipment Technology Co., Ltd., which is principally engaged in high-end automated pharmaceutical equipment. Based on the promise in performance, the net profit after extraordinary gains and losses of General Healthy will reach 40 million yuan and 50 million yuan in 2015 and 2016 respectively.
○Longi Silicon Materials to globally expand PV business with DuPont
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LERRI Solar Technology Co., Ltd., a wholly-owned subsidiary of Xi'an Longi Silicon Materials Corp. (601012.SH), has signed a strategic cooperation agreement with DuPont USA. The two parties will jointly promote LERRI brands and TMSolamet and TM brands of DuPont across the world, and will conduct technical cooperation on improving the efficiency and reliability of solar cell and module and on other relevant fields.
○Topband launches stock incentive plan
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Shenzhen Topband Co., Ltd. (002139.SZ) plans to grant 367 incentive targets with 17.80 million restricted stocks at 7.86 yuan per share, accounting for 7.26 percent of the company's total share capital. The performance assessment goal is that compared with the net profit in 2014, the growth rate of the company's net profit from 2016 to 2018 should be no less than 40 percent, 70 percent and 120 percent.
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