[Today's Guide]
○Sino-Korea FTA approved by Korea, demand for port trade to boost
○Action plan on soil pollution prevention and control to introduce soon, soil treatment industry to see market of RMB1 trl
○Saimo Electric expands to industrial intellectualization, Dima Industry to invest in special military vehicle
○Jiawei Photovoltaic Lighting invests more in PV power station, Jingwei Electric Wire sets foot in innovation industrial park business
[SSN Focus]
○Sino-Korea FTA approved by Korea, demand for port trade to boost
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The Korea Congress voted through Sino-Korea Free Trade Agreement (FTA) on Nov. 30, which was signed on June 1 this year, and proposed to cancel the tariff of 90 percent of the trade products between the two countries within 20 years. Up to now, it is the FTA with the largest trade volume and territory scope signed by China and other countries. On June 1, Dalian Port (PDA) Company Limited (601880.SH), Yingkou Port Liability Co., Ltd. (600317) and Rizhao Port Co., Ltd. (600017) closed at soaring by the daily 10 percent limit.
Comments: Experts in foreign trade field believe that China will approve the FTA soon after review and examination, and the FTA will officially go into effect. It is expected that the trade between the two countries will obviously grow next year, boosting the trade demands of Liaoning Port, Shandong Port and etc., and promoting the negotiation on agreements, like Regional Economic Comprehensive Partnership (RECP).
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[SSN Selection]
○IMF will discuss whether to include RMB into the SDR on Nov. 30 (local time). According to the analysis, most shareholders will vote to support the SDR to include RMB.
○Air quality index in many areas of Beijing City was extremely bad on Nov. 30. Heavy smog is expected to remain at severe pollution levels across northern China for another two days.
○National Development and Reform Commission issued the Management Method on Water Pollution Control Projects for Key Basins to enhance the constructions of comprehensive treatment projects for water environment.
○Three commissions and ministries jointly issued the guidelines to support innovative development of graphene industry, proposing to form a favorable graphene industrial system by 2020.
○Hua Xia Bank Co., Ltd. (600015.SH) and Ant Financial have signed a framework cooperation agreement, and will carry out comprehensive and strategic cooperation on various aspects, including financial ecology of the internet.
[Industry Information]
○Action plan on soil pollution prevention and control to introduce soon, soil treatment industry to see market of RMB1 trl
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The SSN learnt from the recently-held fourth Annual Environmental Protection Meeting that various ministries and commissions, including Ministry of Environmental Protection and Ministry of Land and Resources, jointly formulated the Action Plan on Soil Pollution Prevention and Control which will be issued soon. The content includes delimiting the regions severely polluted by heavy metal, capital needed for treatment, detailed treatment measures as well as the timetable to treat the soil pollution.
Comment: As the action plans for the pollution prevention and control of air and water are launched in succession, China will soon spare intensive efforts in the treatment of soil pollution. Extensive development for years has led to quite serious soil pollution in China. Officials from the Ministry of Environmental Protection once publicly indicated that large amount of funds, at least several trillion yuan and even tens of trillions of yuan, is needed for the treatment of soil pollution. As the senior management pays increasing attentions to soil pollution, the treatment plans and piloting projects will be launched in succession. The soil restoration market will be expanded rapidly. As to listed companies, Yonker Environmental Protection Co., Ltd. (300187.SZ) reports a year-on-year growth of 65 percent in the third quarter in terms of net profit. Its income from the treatment of heavy metal pollution in soil grows by more than 400 percent; Beijing GeoEnviron Engineering ＆ Technology, Inc. (603588.SH) and Guangxi Bossco Environmental Protection Technology Co., Ltd. (300422.SZ) have successful experience of large-scale soil restoration projects and have lots of orders on hand.
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○MOE supports IT application in educational equipment
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The working conference on the national elementary educational equipment is held in Nanjing City, Jiangsu Province on Nov. 30. The Ministry of Education (MOE) indicated that China will establish relevant management information systems, improve the IT application in equipment management and promote their overall application during the period of the thirteenth five-year plan. Vice-Premier Liu Yandong indicated on the second telephone conference on IT application in national education held on Nov. 19 that it should actively promote IT application in education, adopt modern information technologies and share quality educational resources.
Comment: The IT application in education is a great support to the promotion of education fairness and the improvement of education quality, a critical measure in implementing innovation-driven strategy, and will also bring opportunities to enterprises engaged in the construction of educational informatization platforms. As to listed companies, AVCON Information Technology Co., Ltd. (300074.SZ) has introduced online classes and other video application services; Talkweb Information System Co., Ltd. (002261.SZ) proposes to acquire the assets of Sea Sky Land, a leader in the intelligent paper inspection market for senior high school and college entrance examinations.
[Announcement Interpretation]
○Saimo Electric expands to industrial intellectualization
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Saimo Electric Co., Ltd. (300466.SZ) plans to acquire 100 percent equities of Hefei Eagle Automation Engineering Technology Co., Ltd., Wuhan Bosheng Information Technology Co., Ltd. and Nanjing Sanai Industrial Automation Co. Ltd., respectively. The transaction will be done with a total of 575 million yuan by issuing shares at 39.14 yuan per share through private placement and paying in cash. Saimo Electric also plans to raise a supporting fund at no less than 24.74 yuan per share. Eagle Automation Engineering Technology is principally engaged in palletizing robot and automatic packaging machinery; Bosheng Information Technology is involved in the software information service for bulk materials factory; Sanai Industrial Automation is mainly engaged in auto-test products applied in industrial process. The counterparty promises that the total net profit of three target companies in 2016 will be 45.41 million yuan. The stock price of Saimo Electric closed at 27.28 yuan per share before trading suspension.
○Dima Industry to invest in special military vehicle and exoskeleton robot
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Chongqing Dima Industry Co., Ltd. (600565.SH) plans to raise no more than 2 billion yuan through private placement to invest in the construction project of new-type special military vehicle, the industrialization project of exoskeleton robot and etc. The special military vehicles are mainly produced to meet the demand for the loading, storage, guard and biochemical security and etc. of special military weapons; exoskeleton robot adopts wearable intelligent structure with "human-machine doubling", multiplying human's power, and can be applied for military and medical use.
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○Jiawei Photovoltaic Lighting invests more in PV power station
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Shenzhen Jiawei Photovoltaic Lighting Co., Ltd. (300317.SZ) plans to purchase 100 percent equity of Jinchang Guoyuan Electric Power Co., Ltd. by issuing shares at a price of 19.44 yuan per share through private placement, which is valued at 1,105 million yuan. The company also will raise 800 million yuan at most as supporting funds. Jinchang Guoyuan Electric Power is specialized in PV power station projects and manages and maintains a 100MW PV power station in Xipo county, Jinchang City, Gansu Province. The counterparty promises that net profit after extraordinary gains and losses of Jinchang Guoyuan Electric Power will be no less than 78.95 million yuan next year, which realizes 14 times of PE ratio.
○Jingwei Electric Wire sets foot in innovation industrial park business
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Tianjin Jingwei Electric Wire Co., Ltd. (300120.SZ) plans to raise 600 million yuan by issuing shares at a price of 14.89 yuan per share through private placement for investment in 898 innovation industrial park project so as to realize business transformation. The company indicates that the industrial park will conduct extensive cooperation with various colleges and universities from home and abroad in innovation research, innovative curriculum and venture capital fund. The company's share price closed at 17.5 yuan per share before trading suspension.
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○Huapont Life Sciences acquires Paracelsus Suisse to introduce medical technology in China
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Huapont Life Sciences Co., Ltd. (002004.SZ) intends to acquire 70 percent equity of Swiss Biological Medicine Group Ltd. through its subsidiary at no more than 210 million yuan. Swiss Biological Medicine fully owns Paracelsus Suisse, which is leading in such fields as breast cancer, prostate cancer and leukemia. Huapont Life Sciences expresses that it will introduce the medical technology of this hospital to China and promote it through training, cooperative study, joint-venture hospital and solely-owned hospital.
[Financial Reports Express]
○The actual controller of Xilong Chemical Co., Ltd. (002584.SZ) proposes a 15-for-10 conversion of capital surplus into shares in its annual report.
[Trading Alarms]
○8 companies to launch IPOs on Dec. 1
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Offering price of Shanghai Fortune Techgroup Co., Ltd. (300493.SZ) is 6.87 yuan and each account can subscribe 12,000 shares at most. Offering price of Zhejiang Zhongjian Technology Co., Ltd. (002779.SZ) is 12.11 yuan and each account can subscribe 8,500 shares at most. Offering price of Beijing Sanfu Outdoors Co., Ltd. (002780.SZ) is 9.42 yuan and each account can subscribe 6,500 shares at most. Offering price of Guangdong Ban Bao Puzzle Toy Co., Ltd. (603398.SH) is 13.97 yuan and each account can subscribe 9,000 shares at most. Offering price of Anji Foodstuff Co., Ltd. (603696.SH) is 10.1 yuan and each account can subscribe 12,000 shares at most. Offering price of Suzhou Douson Drilling ＆ Production Equipment Co., Ltd. (603800.SH) is 10.95 yuan and each account can subscribe 20,000 shares at most. Offering price of Bomin Electronics Co., Ltd. (603936.SH) is 8.06 yuan and each account can subscribe 16,000 shares at most. Offering price of Duzhe Publishing ＆ Media Co., Ltd. (603999.SH) is 9.77 yuan and each account can subscribe 24,000 shares at most. The IPO PE ratio is all within 23 times and it will cost 1.08 million yuan to subscribe all the shares. Institutions are rosy about Fortune Techgroup, which is engaged in chips sales.
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