[Today's Guide]
> Multi-factors push Shenzhen real estate market to lead surging nationwide, local real estate enterprises to benefit directly
> Domestication of integrated circuit to guarantee information security, caustic soda price continues to hike
> Connected parties of Moso Power to fully subscribe private placement, Huaxing Chuangye Communication Technology to supplement working capital through private placement
> Unisplendour Corporation to acquire assets to expand main business, Hailu Heavy Industry to acquire Gerui Environmental Project
[XFA Focus]
○ Multi-factors push Shenzhen real estate market to lead surging nationwide, local real estate enterprises to benefit directly
------
Though Shenzhen was attacked by rainstorm in the past weekend, three properties newly opened for sales in Shenzhen still experienced hot purchasing with all of them nearly sold out in just one day. The average price of one property located in Longhua New District reached 40,000 yuan per square meter, approaching the price in the downtown. Statistics show that the price of new properties in Shenzhen has surged for 5 consecutive months and the surge in March and April ranked at the top in China.
Comment: As for demand on houses, Shenzhen takes the lead in transforming and upgrading to modern service industry and industrial workers see accelerated localization. At present, the average house per family of permanent resident population is just 0.4 set, far lower than national average level of 1 set. As for house supply, Shenzhen covers a small area, the territorial development has far exceeded warning line and the land supply falls short of demand for several consecutive years. In addition, some real estate developers hype the economic and political position of Shenzhen, adding fuel to its hot real estate market. Local real estate enterprises including Shahe Industry Co., Ltd. (000014.SZ), Shenzhen Centralcon Investment Holding Co., Ltd. (000042.SZ) and China Union Holdings Ltd. (000036.SZ) will directly benefit from the hot real estate market.
[XFA Selection]
○ As reported by the Weibo of Xinhua Insight on May 25, Chinese President Xi Jinping visited Zhoushan City, Zhejiang Province.
○ The State Council Information Office will release a white paper on China’s military strategy on May 26. Leaders from General Staff Operations Department and Strategy Planning Department will attend the press conference.
○ China will lower the import tariff of some goods for everyday consumption from June 1, trying to retain consumption within China.
○ Shanghai’s scheme on constructing world technology innovation center was unveiled on May 25; the idea of constructing a national science center in Zhangjiang District proposed earlier might see accelerated implementation.
○ China National Nuclear Power Co., Ltd. will start online subscription on June 2; China Nuclear Engineering Group, another central enterprise, discloses its prospectus planning to raise 2.7 billion yuan.
○ The scheme on transforming from B share to A share by Jiangsu Future Land Co., Ltd. (900950.SH), the second company following Zhejiang Southeast Electric Power Company Limited (900949.SH), is approved by the general meeting of stockholders and it adopts the same mode with Southeast Electric Power.
[Industry Information]
○ Domestication of integrated circuit to guarantee information security, semiconductor industry to embrace development opportunity
-----
The 13th China International Semiconductor Expo was held in Shanghai on May 25. Xu Xiaotian, secretary general of China Semiconductor Industry Association, indicated that from previous billions of yuan support plan to “Made in China 2025”, China’s semiconductor industry is faced with unprecedented development opportunity. “Made in China 2025” mainly focuses on 10 areas, among which the new generation information technology industry includes three categories with integrated circuit (IC) ranking at the top.
Comment: From the point of view of national security, only by achieving IC domestication can China’s information security be effectively guaranteed. The industry predicts that the growth of China’s IC industry will reach around 20 percent in 2015. As for listed companies, Tianshui Huatian Technology Co., Ltd. (002185.SZ) announced earlier to finance 2 billion yuan to add stakes in the packaging business of IC; as the new products of Hangzhou Silan Microelectronics Co., Ltd. (600460.SH) expands production, the company’s income from IC will continue to grow.
○ Booming downstream demand and low inventory drive caustic soda price high
------
XFA learnt that the average price of caustic soda hiked nearly 2 percent in one week, hitting a new high in 2015.
Comment: The price rise of caustic soda is due to the relatively limited supply as a result of the overhaul of enterprises as well as the booming demand in the downstream. In addition, key figures involved in the glyphosate pollution in Zhejiang Province were given a harsh sentence. The requirement on environmental protection brings more pressure on industries with high energy consumption and pollution. Enterprises with low caustic soda capacity are expected to exit from the market. Insiders estimate that the caustic soda price will further hike. Among caustic soda manufacturers in Shandong Province, Befar Group Co., Ltd. (601678.SH) produced 530,000 tons of caustic soda last year. Shandong Haihua Company Limited (000822.SZ) is one of the three A-share companies under CNOOC Limited (00883.HK).
[Announcement Interpretation]
○ Moso Power Supply to raise RMB860 mln in PV power generation through private placement, connected parties to fully subscribe
------
Moso Power Supply Technology Co., Ltd. (002660.SZ) proposes to raise 860 million yuan by issuing 105 million shares at 8.16 yuan per share through private placement. The proceeds will be invested in its three photovoltaic power generation projects and supplement working capital. Gu Yongde, the actual controller of the company will subscribe 99.50 million shares or nearly 95 percent with 810 million yuan. Five senior management of the company, including Qin Chuanjun, will subscribe the remaining shares.
○ Huaxing Chuangye Communication Technology to raise RMB700 mln to supplement working capital
------
Hangzhou Huaxing Chuangye Communication Technology Co., Ltd. (300025.SZ) plans to raise 700 million yuan by issuing 40.86 million shares at 17.13 yuan per share through private placement. The proceeds will supplement working capital. Cheng Xiaoyan, the controlling shareholder and chairman of the company, and the Xingquan private placement plan No. 107 subscribed by the senior management of the company, will participate in the subscription.
○ Unisplendour Corporation to acquire assets with RMB22.5 bln to expand main business
------
Unisplendour Corporation Limited (000938.SZ) intends to raise 22.5 billion yuan by issuing 850 million shares at 26.51 yuan per share to the employee shareholding plans No. 1 and 2, Jointcom Communication Technology Co., Ltd. and its persons acting in concert. The proceeds will be used in acquiring 51 percent equities of Hong Kong H3C, 44 percent equities of Unisplendour Digital and 49 percent equities of Unisplendour Software.
Unisplendour Digital and Unisplendour Software will become wholly-owned subsidiaries of the company after the issuance. Based on the agreement between Hong Kong H3C and HP, the former will conduct the sale of servers and memories of the latter in the Mainland, the technical services and acquire 100 percent equities of Tianjin HP. The company will also establish a computer study laboratory and big data coordination center.
○ Hailu Heavy Industry to acquire Gerui Environmental Project through private placement
------
Suzhou Hailu Heavy Industry Co., Ltd. (002255.SZ) proposes to acquire 100 percent equities of Zhangjiagang Gerui Environmental Project Co., Ltd. with 625 million yuan by issuing 40.55 million shares at 12.33 yuan per share through private placement and paying 125 million yuan in cash. The counterparty committed that the performance of Gerui Environmental Project from 2015 to 2017 will be no less than 46 million yuan, 56 million yuan and 64 million yuan, respectively. Gerui Environmental Project is principally engaged in the design, construction and testing of environmental projects, the production and sale of environmental equipment and the treatment of solid industrial waste. It has its own sewage treatment plant.
○ Water Business Doctor to raise over RMB3 bln through private placement to develop main business
------
Beijing Water Business Doctor Co., Ltd. (300055.SZ) plans to raise 3.1 billion yuan by issuing 130 million shares to no more than five targeted participants through private placement. The proceeds will be invested in four municipal projects under the partnership with the government, including water supply and sewage treatment.
○ Lifan Industry to establish industrial chain for intelligent new energy vehicles with RMB5.2 bln
------
Lifan Industry (Group) Co., Ltd. (601777.SH) intends to raise 5.2 billion yuan by issuing 430 million shares at 12.08 yuan per share through private placement. Chongqing Lifan Holdings Ltd., the controlling shareholder, will subscribe 1,511 million yuan. Chen Wei, a senior management of the company, will subscribe 500 million yuan. The senior management of the company and its connected parties will subscribe 140 million yuan through the assets management plan. The proceeds will be invested in the energy stations for intelligent new energy vehicles, lithium cores, electric control system for engines and other projects. It will establish a complete industrial chain for new energy vehicles.
○ Combustion Control Technology obtains environmental protection order of RMB7.2 bln
------
Xuzhou Combustion Control Technology Co., Ltd. (300152.SZ) won the tender for the PPP construction project for the comprehensive demonstration of energy-saving, emission-reducing and fiscal policies of Liaocheng City. The investment is expected to be 7.25 billion yuan and the investment in the project accounts for 860 percent of the business revenue of the company in 2014. The projects include the gas treatment, sewage treatment, wetland treatment, energy saving and monitoring. Liaocheng is one of the 12 cities for the comprehensive demonstration of energy-saving, emission-reducing and fiscal policies.
[Companies Hotspot]
○ Xiangjiang New Area officially established, Kingray New Materials plans in advance
------
Xiangjiang New Area, a new area at the state level, was officially established on May 24. Kingray New Materials Science & Technology Co., Ltd. (600390.SH), which is conducting industrial development in the Changsha National High-Tech Industrial Development Zone, will benefit from it. A wholly-owned subsidiary of Kingray New Materials plans to invest in the construction of the Wukuang Lugu Science and Technology Industrial Park, which is located at the central Xiangjiang New Area. It is expected to start presale in the end of the year and will boost the performance of the company in the following three years. Besides, the company has completed the acquisition of 49 percent equities of Hunan Changyuan Lico Co., Ltd., which will boost the performance of the company in 2015.
> Multi-factors push Shenzhen real estate market to lead surging nationwide, local real estate enterprises to benefit directly
> Domestication of integrated circuit to guarantee information security, caustic soda price continues to hike
> Connected parties of Moso Power to fully subscribe private placement, Huaxing Chuangye Communication Technology to supplement working capital through private placement
> Unisplendour Corporation to acquire assets to expand main business, Hailu Heavy Industry to acquire Gerui Environmental Project
[XFA Focus]
○ Multi-factors push Shenzhen real estate market to lead surging nationwide, local real estate enterprises to benefit directly
------
Though Shenzhen was attacked by rainstorm in the past weekend, three properties newly opened for sales in Shenzhen still experienced hot purchasing with all of them nearly sold out in just one day. The average price of one property located in Longhua New District reached 40,000 yuan per square meter, approaching the price in the downtown. Statistics show that the price of new properties in Shenzhen has surged for 5 consecutive months and the surge in March and April ranked at the top in China.
Comment: As for demand on houses, Shenzhen takes the lead in transforming and upgrading to modern service industry and industrial workers see accelerated localization. At present, the average house per family of permanent resident population is just 0.4 set, far lower than national average level of 1 set. As for house supply, Shenzhen covers a small area, the territorial development has far exceeded warning line and the land supply falls short of demand for several consecutive years. In addition, some real estate developers hype the economic and political position of Shenzhen, adding fuel to its hot real estate market. Local real estate enterprises including Shahe Industry Co., Ltd. (000014.SZ), Shenzhen Centralcon Investment Holding Co., Ltd. (000042.SZ) and China Union Holdings Ltd. (000036.SZ) will directly benefit from the hot real estate market.
[XFA Selection]
○ As reported by the Weibo of Xinhua Insight on May 25, Chinese President Xi Jinping visited Zhoushan City, Zhejiang Province.
○ The State Council Information Office will release a white paper on China’s military strategy on May 26. Leaders from General Staff Operations Department and Strategy Planning Department will attend the press conference.
○ China will lower the import tariff of some goods for everyday consumption from June 1, trying to retain consumption within China.
○ Shanghai’s scheme on constructing world technology innovation center was unveiled on May 25; the idea of constructing a national science center in Zhangjiang District proposed earlier might see accelerated implementation.
○ China National Nuclear Power Co., Ltd. will start online subscription on June 2; China Nuclear Engineering Group, another central enterprise, discloses its prospectus planning to raise 2.7 billion yuan.
○ The scheme on transforming from B share to A share by Jiangsu Future Land Co., Ltd. (900950.SH), the second company following Zhejiang Southeast Electric Power Company Limited (900949.SH), is approved by the general meeting of stockholders and it adopts the same mode with Southeast Electric Power.
[Industry Information]
○ Domestication of integrated circuit to guarantee information security, semiconductor industry to embrace development opportunity
-----
The 13th China International Semiconductor Expo was held in Shanghai on May 25. Xu Xiaotian, secretary general of China Semiconductor Industry Association, indicated that from previous billions of yuan support plan to “Made in China 2025”, China’s semiconductor industry is faced with unprecedented development opportunity. “Made in China 2025” mainly focuses on 10 areas, among which the new generation information technology industry includes three categories with integrated circuit (IC) ranking at the top.
Comment: From the point of view of national security, only by achieving IC domestication can China’s information security be effectively guaranteed. The industry predicts that the growth of China’s IC industry will reach around 20 percent in 2015. As for listed companies, Tianshui Huatian Technology Co., Ltd. (002185.SZ) announced earlier to finance 2 billion yuan to add stakes in the packaging business of IC; as the new products of Hangzhou Silan Microelectronics Co., Ltd. (600460.SH) expands production, the company’s income from IC will continue to grow.
○ Booming downstream demand and low inventory drive caustic soda price high
------
XFA learnt that the average price of caustic soda hiked nearly 2 percent in one week, hitting a new high in 2015.
Comment: The price rise of caustic soda is due to the relatively limited supply as a result of the overhaul of enterprises as well as the booming demand in the downstream. In addition, key figures involved in the glyphosate pollution in Zhejiang Province were given a harsh sentence. The requirement on environmental protection brings more pressure on industries with high energy consumption and pollution. Enterprises with low caustic soda capacity are expected to exit from the market. Insiders estimate that the caustic soda price will further hike. Among caustic soda manufacturers in Shandong Province, Befar Group Co., Ltd. (601678.SH) produced 530,000 tons of caustic soda last year. Shandong Haihua Company Limited (000822.SZ) is one of the three A-share companies under CNOOC Limited (00883.HK).
[Announcement Interpretation]
○ Moso Power Supply to raise RMB860 mln in PV power generation through private placement, connected parties to fully subscribe
------
Moso Power Supply Technology Co., Ltd. (002660.SZ) proposes to raise 860 million yuan by issuing 105 million shares at 8.16 yuan per share through private placement. The proceeds will be invested in its three photovoltaic power generation projects and supplement working capital. Gu Yongde, the actual controller of the company will subscribe 99.50 million shares or nearly 95 percent with 810 million yuan. Five senior management of the company, including Qin Chuanjun, will subscribe the remaining shares.
○ Huaxing Chuangye Communication Technology to raise RMB700 mln to supplement working capital
------
Hangzhou Huaxing Chuangye Communication Technology Co., Ltd. (300025.SZ) plans to raise 700 million yuan by issuing 40.86 million shares at 17.13 yuan per share through private placement. The proceeds will supplement working capital. Cheng Xiaoyan, the controlling shareholder and chairman of the company, and the Xingquan private placement plan No. 107 subscribed by the senior management of the company, will participate in the subscription.
○ Unisplendour Corporation to acquire assets with RMB22.5 bln to expand main business
------
Unisplendour Corporation Limited (000938.SZ) intends to raise 22.5 billion yuan by issuing 850 million shares at 26.51 yuan per share to the employee shareholding plans No. 1 and 2, Jointcom Communication Technology Co., Ltd. and its persons acting in concert. The proceeds will be used in acquiring 51 percent equities of Hong Kong H3C, 44 percent equities of Unisplendour Digital and 49 percent equities of Unisplendour Software.
Unisplendour Digital and Unisplendour Software will become wholly-owned subsidiaries of the company after the issuance. Based on the agreement between Hong Kong H3C and HP, the former will conduct the sale of servers and memories of the latter in the Mainland, the technical services and acquire 100 percent equities of Tianjin HP. The company will also establish a computer study laboratory and big data coordination center.
○ Hailu Heavy Industry to acquire Gerui Environmental Project through private placement
------
Suzhou Hailu Heavy Industry Co., Ltd. (002255.SZ) proposes to acquire 100 percent equities of Zhangjiagang Gerui Environmental Project Co., Ltd. with 625 million yuan by issuing 40.55 million shares at 12.33 yuan per share through private placement and paying 125 million yuan in cash. The counterparty committed that the performance of Gerui Environmental Project from 2015 to 2017 will be no less than 46 million yuan, 56 million yuan and 64 million yuan, respectively. Gerui Environmental Project is principally engaged in the design, construction and testing of environmental projects, the production and sale of environmental equipment and the treatment of solid industrial waste. It has its own sewage treatment plant.
○ Water Business Doctor to raise over RMB3 bln through private placement to develop main business
------
Beijing Water Business Doctor Co., Ltd. (300055.SZ) plans to raise 3.1 billion yuan by issuing 130 million shares to no more than five targeted participants through private placement. The proceeds will be invested in four municipal projects under the partnership with the government, including water supply and sewage treatment.
○ Lifan Industry to establish industrial chain for intelligent new energy vehicles with RMB5.2 bln
------
Lifan Industry (Group) Co., Ltd. (601777.SH) intends to raise 5.2 billion yuan by issuing 430 million shares at 12.08 yuan per share through private placement. Chongqing Lifan Holdings Ltd., the controlling shareholder, will subscribe 1,511 million yuan. Chen Wei, a senior management of the company, will subscribe 500 million yuan. The senior management of the company and its connected parties will subscribe 140 million yuan through the assets management plan. The proceeds will be invested in the energy stations for intelligent new energy vehicles, lithium cores, electric control system for engines and other projects. It will establish a complete industrial chain for new energy vehicles.
○ Combustion Control Technology obtains environmental protection order of RMB7.2 bln
------
Xuzhou Combustion Control Technology Co., Ltd. (300152.SZ) won the tender for the PPP construction project for the comprehensive demonstration of energy-saving, emission-reducing and fiscal policies of Liaocheng City. The investment is expected to be 7.25 billion yuan and the investment in the project accounts for 860 percent of the business revenue of the company in 2014. The projects include the gas treatment, sewage treatment, wetland treatment, energy saving and monitoring. Liaocheng is one of the 12 cities for the comprehensive demonstration of energy-saving, emission-reducing and fiscal policies.
[Companies Hotspot]
○ Xiangjiang New Area officially established, Kingray New Materials plans in advance
------
Xiangjiang New Area, a new area at the state level, was officially established on May 24. Kingray New Materials Science & Technology Co., Ltd. (600390.SH), which is conducting industrial development in the Changsha National High-Tech Industrial Development Zone, will benefit from it. A wholly-owned subsidiary of Kingray New Materials plans to invest in the construction of the Wukuang Lugu Science and Technology Industrial Park, which is located at the central Xiangjiang New Area. It is expected to start presale in the end of the year and will boost the performance of the company in the following three years. Besides, the company has completed the acquisition of 49 percent equities of Hunan Changyuan Lico Co., Ltd., which will boost the performance of the company in 2015.
Latest comments