[Today's Guide]
○Government greatly supported network literature and art, media industry to see new opportunities
○MIIT supports "going out" of equipment manufacturing, advantageous industries to see exports
○1st popular entrepreneurship and innovation week kicks off, intelligent robots emerge
○CSF and Central Huijin take 9 seats in shareholders list of Newland Computer, Tatwah Smartech to fully control two companies
[SSN Focus]
○Government greatly supported network literature and art, media industry to see new opportunities
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Xinhua News Agency on Oct. 19 released the Comments of the Central Committee of the Communist Party of China on Prosperously Developing Socialistic Literature and Art. The Comments proposes to intensively develop network literature and art, carry out related creation and popularity plan for network works, and encourage excellent original network works, so as to promote the prosperous and orderly development for emerging literature and art, such as network literatures, music, dramas, micro films, shows, cartoons and etc.
Comment: It is the first time for "significantly developing network literature and art" to be specified in conference documents of the highest level. Original network works are currently the significant sources of China's mass culture. Various films, TVs and games edited from network literatures gained huge economic benefits. Institutions believed that development of network literature will bring new opportunities for industries, such as digital publication, films, TVs, cartoons and etc. In terms of companies listed in A-share market, China South Publishing ＆ Media Group Co., Ltd. (601098.SH) covers a series of internet writers, and institutions are optimistic towards its advantage of internet IP resources; Chinese Universe Publishing And Media Co., Ltd. (600373.SH) and Jiangsu Phoenix Publishing ＆ Media Corporation Limited (601928.SH) are also transforming to digitization and new media fields.
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[SSN Selection]
○SSN learnt that China Insurance Regulatory Commission recently made amendments to Interim Measures for the Administration of Use of Insurance Capital, whereby threshold for insurance capital to invest in funds is expected to be lowered.
○The Electronic Information Division of the Ministry of Industry and Information Technology recently convened a working conference in relation to audio-visual industry for the first three quarters, and proposed to push out the introduction of national mandatory standard on internet TV receiving equipment.
○China's GDP growth rate hit 6.9% in Q3. Analysts believe that the Peoples Bank of China may further cut interest rates and reserved requirement ratio in the fourth quarter.
○Total electricity consumption of China in the first nine months records a growth rate of 0.8 percent year-on-year, among which the service sector posted the highest growth rate, i.e. 7.3 percent.
○SSN learnt that relevant regulations on tax preference for health insurance will be unveiled within the year. Large life insurance and professional health insurance companies will benefit.
[Industry Information]
○MIIT supports "going out" of equipment manufacturing, advantageous industries to see exports
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As reported by SSN, the Ministry of Industry and Information Technology (MIIT) is working out planning on the "going out" strategy of manufacturing industry by combining with some significant strategies including the Belt and Road Initiatives and interconnection of infrastructure along the Belt and Road. It proposes to bring international production capacity and equipment manufacturing cooperation into the support coverage of Silk Road funds and Asian Infrastructure Investment Bank so as to drive industry by projects and accelerate manufacturing industry going out.
Comment: Chinese manufacturing is becoming less advantageous in product output, which solely depends on the cost advantage. Industries and capital output of high-end manufacturing such as marine engineering equipment, high-speed railway and nuclear power are in the ascendant. China CSSC Holdings Limited (600150.SH), China International Marine Containers (Group) Co., Ltd. (02039.HK; 000039.SZ) and other central enterprises are expected to benefit from this.
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○1st popular entrepreneurship and innovation week kicks off, intelligent robots emerge
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The first national popular entrepreneurship and innovation week is kicked off on Oct. 19 and a series of various activities are simultaneously held in 8 cities including Beijing. Chinese Premier Li Keqiang indicated at the main meeting place in Zhongguancun that under the crucial period of transformation of development mode and old and new development momentum, China should activate creativity of the whole society and develop new engine through the structural reform of the popular entrepreneurship and innovation. Li also has friendly talks with Xiaodu, a robot developed by Baidu Inc. (Nasdaq: BIDU).
Comment: In comparison with the industrial robot originated in the 1960s, service robot is just arising in the 21st century. The household robot, entertainment robot and medical robot enjoy huge potential market demands. As these products are easier to meet standardized production, the market will be open rapidly once the competitive products are successful in promotion. Among the companies listed in A-share market, Hang Zhou Great Star Industrial Co., Ltd. (002444.SZ) has carried out trial production of cleaning robot. Canny Elevator Co., Ltd. (002367.SZ) will release a commercial service robot with height of 1.28m at World Robot Conference 2015, which is to be held in November.
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[Announcement Interpretation]
○CSF and Central Huijin take 9 seats in shareholders list of Newland Computer
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According to the shareholders list of Fujian Newland Computer Co., Ltd. (000997.SZ) in its Q3 report, besides its biggest shareholder Newland Technology Group Co., Ltd., the other nine ones are occupied by accounts of China Securities Finance Corporation Limited (CSF) and Central Huijin Investment Ltd., which total hold 10.34 percent equity of the company. Newland Computer is principally engaged in electronic payment and information identity products. It is one of leaders in Internet of Things. Its net profits grew by 59 percent year on year in the first three quarters.
[TOP]
○Tatwah Smartech to fully control software securities companies with RMB300 mln
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Tatwah Smartech Co., Ltd. (002512.SZ) plans to acquire 49.02 percent equities of Shanxi Youmachuangda Software Technology Company Limited with 212 million yuan and acquire 49 percent equities of Wuhan Century Golden Bridge Technology Safety Co., Ltd. with 83.30 million yuan. Upon completion, the company will hold 100 percent equities of Youmachuangda Software Technology and Century Golden Bridge Technology Safety, respectively.
According to performance commitment, the net profit of Youmachuangda Software Technology from 2015 to 2017 will record 28.05 million yuan, 35.55 million yuan and 45.43 million yuan, respectively; the net profit of Century Golden Bridge Technology Safety will record 14.53 million yuan, 16.68 million yuan and 18.43 million yuan, respectively.
○Heilan Home invests over RMB1.3 bln in constructing intelligent logistics warehouse
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A fully-owned subsidiary under Heilan Home Co., Ltd. (600398.SH) plans to invest in the construction of "intelligent logistics warehouse project" with 1,307 million yuan. The project's logistics turnover capacity will reach 15,000 units per year in full-load operation. The company's third quarterly report announces a year-on-year growth of 42 percent in net profit. China Securities Finance Corporation Limited (CSF) ranks as the sixth substantial shareholder of the company's tradable shares.
○Jiaxun Feihong Electrical adds stakes in railway digital communications
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Beijing Jiaxun Feihong Electrical Co., Ltd. (300213.SZ) plans to acquire 30.26 percent equities of Jinan Railway Tianlong High-Tech Development Co., Ltd. with 68.09 million yuan, increasing its shareholding in the company to 81.26 percent. Jinan Railway Tianlong High-Tech Development mainly focuses on railway digital communications and signal control equipment. According to performance commitment, the total net profit of Jinan Railway Tianlong High-Tech Development during 2015-2017 should be 45 million yuan; the net profit in 2015 and 2016 should be no less than 15 million yuan, respectively.
○Huaren Phar. focuses on acquisition of Hongta Innovation Investment
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Huaren Pharmaceutical Co., Ltd. (300110.SZ) terminates the acquisition of Tsingtao Huaren Tery Pharmaceutical Co., Ltd. The company will focus on the major asset reorganization concerning the acquisition of 100 percent equities of Hongta Innovation Investment Co., Ltd. During the trading suspension of the company, the ChiNext Board Index experienced obvious surge.
[Financial Reports Express]
○Eastern Gold Jade forecasts growth in net profit
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Thanks to that the revenue on jade stone and the income from investment grow, Eastern Gold Jade Co., Ltd. (600086.SH) expects its net profit in the first three quarters to see a year-on-year growth of 220-260 percent.
[Trading Trends]
○Zhejiang Netsun bought by five institutional seats
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The trading volume ranking list on Oct. 19 shows that Zhejiang Netsun Co., Ltd. (002095.SZ) was bought by five institutional seats with 190 million yuan, accounting for 13.5 percent of its intraday turnover. No institutional seats sold the stock.
Comment: Zhejiang Netsun provides clients with one-stop service including big data, Internet-based finance, e-commerce and logistics warehouse. The company inked strategic cooperation agreement with Ningbo Port Company Limited (601018.SH) in late July to build the "Ningbo Port Liquid Chemicals Trading Market" into a platform integrating the online trading, payment and settlement of liquid chemicals as well as Internet-based finance. Institutions believe that the company's business in trading, supply chain financing and etc. will see huge potential development space.
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