[Today's Guide]
○State Council checks and approves two nuclear power projects, nuclear power era 3.0 to start
○MOF continues to award charging facilities for new energy vehicles, market expansion to accelerate
○Ingenious Ene-Carbon New Materials to acquire Chenyang New Carbon Material, Kangde Xin Composite Material invests in glasses-free 3D modules by private placement
○Pacific Precision Forging enters automotive electronics, Neusoft Corporation invests in big data by private placement
[SSN Focus]
○State Council checks and approves two nuclear power projects, nuclear power era 3.0 to start
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The executive meeting of the State Council held on Dec. 16 determined to check and approve Wudongde hydroelectric power station along with the Jinsha River, Fangchenggang nuclear power engineering project II, "Hualong One" nuclear power unit and Tianwan nuclear power extension project. On the same day, the website of the Xinhua News Agency issued an article Is Nuclear Power Safe? - Exploring China's Nuclear Power Base, which pointed out that domestic nuclear power technology III could resist dramatic shocks from large airplane, strong earthquake and etc.; the second nuclear power unit of "Hualong One" in Fuqing City and Fangchenggang nuclear power project will be constructed before the end of this month, and the unit in Rongcheng City will be constructed from the spring of next year.
Comments: Driven by air pollution treatment and the Paris Convention's emission reduction goal, energy structure transformation will become a key theme for the "13th Five-year Plan". Nuclear power is one of the most effective clean energies. Currently, the scale of China's nuclear power under construction ranks No.1 in the world. The "13th Five-year Plan" requires the installed capacity for operation increases to 58 million kilowatt from current 25.50 million kilowatt. Along with increasingly rare sites suitable to construct the plants in coastal areas, various institutions expect that inland nuclear power will be reinitiated in 2016. In terms of companies listed in the A-share market, SUFA Technology Industry Co., Ltd. (000777.SZ) undertakes a task to domesticate the key valves for nuclear power; Jiangsu Shentong Valve Co., Ltd. (002438.SZ) requires to gain a net profit growth of 240 percent after deduction for 2016 through an equity-incentive plan; Shenzhen Woer Heat-Shrinkable Material Co., Ltd. (002130.SZ) is mainly engaged in new high-polymer materials modified by the nuclear radiation.
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[SSN Selection]
○China Insurance Regulatory Commission on Dec. 16 issued a guiding framework for health insurance products based on individual income tax reduction and three clauses. Health insurance tax enters into a stage of actual implementation.
○National Development and Reform Commission released the second batch of 1,488 recommended PPP projects with a total investment of 2.26 trillion yuan.
○Tianjin City initiates the Green Channel Project of "Internet plus new energy", making Tianjin the first pilot city to popularize the new energy automobiles in the field of express mail service.
○Sichuan province proposes to beef up at least 500 billion yuan in its transportation construction and its expressway mileage will reach 8,000 kilometers during the period of the thirteenth five-year plan.
○Data from the Hong Kong Exchanges and Clearing Limited shows that Shenzhen Jushenghua Co., Ltd. under Baoneng Group increased shareholding in China Vanke Co., Ltd. (02202.HK) during Dec. 10 and 11 to a shareholding proportion of 22.45 percent from previous 20.01 percent.
[Industry Information]
○MOF continues to award charging facilities for new energy vehicles, market expansion to accelerate
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Five ministries and commissions, including the Ministry of Finance (MOF), release a draft on incentive policies on charging facilities for opinions on Dec. 16, setting incentive standards for charging facilities based on the conversion coefficient and promotion of different models and other indicators. The Guidance on Accelerating the Construction of Basic Charging Facilities for Electric Vehicles, printed and distributed by the General Office of the State Council earlier, proposes that advancing the construction of basic charging facilities is an important guarantee behind the development of new energy vehicle industry. State Grid Corporation of China also has initiated the bidding of five batches of charging equipment in succession.
Comment: Supported by central financial funds and driven by social capitals, it is expected that the market of charging piles (stations) will reach above 100 billion yuan in 2020. Relevant enterprises engaged in the manufacturing and operation of charging equipment will see actual business expansion opportunities. In terms of listed companies, the charging piles products produced by Zhejiang Wanma Co., Ltd. (002276.SZ) frequently gain orders from State Grid Corporation of China; Qingdao TGOOD Electric Co., Ltd. (300001.SZ) is promoting the establishment of group charging system platform for vehicles.
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[Announcement Interpretation]
○Ingenious Ene-Carbon New Materials to acquire Chenyang New Carbon Material to straighten out industrial chain
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Ingenious Ene-Carbon New Materials Co., Ltd. (000511.SZ) plans to acquire 100 percent equities of Shandong Chenyang New Carbon Material Co., Ltd. with 610 million yuan by issuing shares at 7.83 yuan per share through private placement. Ingenious Ene-Carbon New Materials also plans to raise a supporting fund of 610 million yuan at no less than 7.83 yuan per share. Chenyang New Carbon Material is principally engaged in the production of various carbon materials including high-end asphalt, prebaked anode, carbon black, negative electrode of Li-ion battery and compound graphene. The counterparty promises a net profit of no less than 49 million yuan in 2016. The stock price of the company closed at 8.91 yuan per share before trading suspension.
○Kangde Xin Composite Material invests in glasses-free 3D modules by private placement
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Jiangsu Kangde Xin Composite Material Co., Ltd. (002450.SZ) plans to raise 4.8 billion yuan at most from its controlling shareholder Kangde Group by issuing shares at a price of 32.69 yuan per share through private placement. The fundraising will be invested in a project with an annual production of 102 million square meters of cutting-edged polymeric membrane material and a project with an annual production of 100 million pieces of glasses-free 3D modules. The company's share price closed at 38 yuan per share before trading suspension.
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○Pacific Precision Forging enters automotive electronics
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Jiangsu Pacific Precision Forging Co., Ltd. (300258.SZ) purchases 100 percent equity of Ningbo Royal Electronics Co., Ltd. at 100 million yuan, which is principally engaged in the R＆D and production of variable valve timing system of automobiles. The counterpart promises that the net profit after extraordinary gains and losses of Royal Electronics will not be less than 11 million yuan in 2016. Pacific Precision Forging indicates that the acquisition will facilitate the company to further expand the business of its automotive electronic control products to better meet the demand for development of the new energy vehicle industry.
○Neusoft Corporation (600718.SH) intends to raise no more than 2.9 billion yuan at a price of 18.22 yuan per share through private placement to invest in big data, medical informatization, automobile intelligentization and other projects. The company's share price ended at 23.57 yuan per share before trading suspension.
[TOP]
○China Animal Husbandry Industry Co., Ltd. (600195.SH) terminates major assets restructuring and will resume trading from Dec. 17.
[Trading Trends]
○5 institutional seats bought Yango Group
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The trading volume ranking list on Dec. 16 shows that Yango Group Co., Ltd. (000671.SZ) was bought through five institutional seats with a total of 290 million yuan, accounting for 40 percent of its intraday turnover. One institutional seat sold the company's share worth 13.83 million yuan.
Comment: Yango Group is principally engaged in real estate. Institutions are optimistic about the performance of blue-chip stocks under the improved economic margin, including products in the real estate, nonferrous metal and other sectors. In addition, Chinese central government recently proposes to reduce housing inventories to promote the new citizen-oriented housing system reform, which also boosted the real estate sector.
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