[Today's Guide]
○Executive meeting of the State Council supports the development of cross-border ecommerce, comprehensive pilot area to expand
○Ganzhou tungsten association increases predicted average price of tungsten products, vehicles aftermarket to embrace new opportunities
○CSG Smart Science ＆ Technology to acquire two intelligent manufacturing enterprises, Ceepower to fully control Golden Highway Technology
○Qunxing Toys and others see shareholding increase, Hubei Golden Ring and others propose high share conversion and dividend
[SSN Focus]
○Executive meeting of the State Council supports the development of cross-border ecommerce, comprehensive pilot areas to expand
------
Executive meeting of the State Council convened on Jan. 6 decided to promote relevant policy system and management system explored from the pioneering Hangzhou cross-border comprehensive pilot region to broader areas. The meeting suggested establishing new cross-border ecommerce comprehensive pilot areas in a number of selected cities in the middle and west with proper basic condition and large export and import and ecommerce scale, and build six systems, including information sharing system and intelligent logistics system.
Comment: the nature of cross-border ecommerce is breaking the barrier of global commodity circulation with internet and modern logistics. It is imperative for China to increase export and transform its economy by leveraging this commanding ground. Institutions predicted that by 2020, trading turnover of cross-border ecommerce will be 3.6 times that of 2014. Subsectors like trade, logistics and IT will incubate a lot of investment opportunities. Of A share companies, automated customs clearance system of Jiangsu Xinning Modern Logistics Co., Ltd. (300013.SZ) is a new force emerging in cross-border ecommerce sector; Better Life Commercial Chain Share Co., Ltd. (002251.SZ) have cross-border ecommerce platforms yunhou.com and overseas shopping special train Hunan-Europe Express; CTS International Logistics Corporation Limited (603128.SH) get access to logistic channel of global shipping LCL cargo.
[SSN Selection]
○President Xi Jinping emphasized on a recent investigation tour to Chongqing that the primary contradiction of China's economic development lies in supply side, and China should promote effective absorption of excessive production capacity.
○President Li Keqiang indicated at a meeting with British Foreign Minister on Jan.6 that China is willing to work together with the UK to strengthen cooperation in innovative, financial, nuclear power sectors.
○China's biggest titanium dioxide manufacturer Sichuan Longmang increased the prices of its products of all brands by 300 yuan per ton. It is estimated that other manufacturer will follow.
○New display technology dominated the CES expo opened on Jan. 6. Chinese companies such as Jiangsu Kangde Xin Composite Material Co., Ltd. (002450.SZ) and Hisense joined the expo with their new products.
○The 13th Five-year textile industry plan has been formulated. During the 13th Five-year plan period, textile industry is expected to keep double-digit growth.
[TOP]
[Industry Information]
○Ganzhou tungsten association increases predicted average price of tungsten, situation of industry expected to improve
------
SSN learnt that Ganzhou tungsten association on Jan.5 increased predicted average market price of tungsten for January 2016, with the range from 3 percent to 7 percent. The average price of black tungsten concentrate, APT, medium grain powder are 66,000 yuan per ton, 100,003 yuan per ton and 162 yuan per ton, respectively. The price hike by Ganzhou tungsten association this time plays an important guidance role for the industry. Tungsten products manufacturer look on from the sidelines will have more confidence to increase prices.
Comment: As a result of the restriction on output of major mines and the production suspension and overhauls of medium and small mines, the market price of tungsten concentrates have recovered and have surged nearly 20 percent since November. As a key national strategic resources, the tungsten industrial chain will embrace improvement opportunities driven by the national acquisition and storage and the restriction on production to maintain prices. In terms of listed companies, Chongyi Zhangyuan Tungsten Co., Ltd. (002378.SZ) and Xiamen Tungsten Co., Ltd. (600549.SH) owns full industrial chains covering mining, smelting and deep processing.
○Regulation on vehicles sales solicits opinions, aftermarket to embrace new opportunities
------
The Ministry of Commerce releases the draft of the regulation on vehicles sales to solicit opinions on Jan. 6, requiring promoting innovation in vehicles distribution patterns, actively developing e-business and facilitating the transformation of vehicles distributors. Besides, the draft greatly relaxes the restriction on the after-sale market and proposes that suppliers and distributors shall not restrict the household registration of consumers and shall not designate the suppliers of auto spare parts, products and financial and insurance products and after-sale services providers.
Comment: Insiders believe that the new policy will break the dominance and monopoly position of complete vehicles manufacturers in the automobile industrial chain. The Chinese automobile industry is gradually transforming from a sales market to an inventory market. The aftermarket will embrace rapid development opportunities. Among listed companies, Jiangsu Etern Co., Ltd. (600105.SH) introduced Dongchang Group as its strategic investor last year and established an industrial fund to develop the automobile aftermarket. Ningbo Tuopu Group Co., Ltd. (601689.SH) established Tuopu Vehicles Repairing E-Business Company to establish a vehicles aftermarket services platform.
[TOP]
[Announcement Interpretation]
○CSG Smart Science ＆ Technology to acquire two intelligent manufacturing enterprises with RMB1.35 bln
------
CSG Smart Science ＆ Technology Co., Ltd. (300222.SZ) proposes to acquire 100 percent equities of Automate Technology (Shanghai) Co., Ltd. and Huaxiao Precision (Suzhou) Co., Ltd. by issuing shares at 17.78 yuan per share through private placement and in cash with a price of 800 million yuan and 549 million yuan, respectively. Meanwhile, the company plans to raise a supporting fund of 790 million yuan by issuing shares at 19.74 yuan per share through private placement.
The counterparties committed that the total net profits of Automate Technology and Huaxiao Precision in 2016-2018 will be no less than 87 million yuan, 110 million yuan and 138 million yuan, respectively. The company indicated that it would promote the scale industrialization of the intelligent soft manufacturing system with industrial robots as the core through the acquisition of Automate Technology. It will complete the industrial layout in the industrial production and intelligent logistics transportation industry through the acquisition of Huaxiao Precision.
○Ceepower to fully control Golden Highway Technology to develop Internet of energy
------
Ceepower Co., Ltd. (300062.SZ) intends to acquire 49 percent equities of Shenzhen Golden Highway Technology Co., Ltd. with 343 million yuan by issuing shares at 19.46 yuan per share through private placement and in cash. Golden Highway Technology will become a wholly-owned subsidiary of the listed company after the transaction. The company also plans to raise a supporting fund of 343 million yuan. Golden Highway Technology is a provider of the Internet of energy solutions. The counterparty committed that its net profit after extraordinary items from 2016 to 2018 will be no less than 45 million yuan, 54 million yuan and 64.8 million yuan, respectively. The committed total profit for the three years will be 164 million yuan.
[TOP]
○Qunxing Toys and others see shareholding increase
------
Guangdong Qunxing Investment Co., Ltd., controlling shareholder of Guangdong Qunxing Toys Joint-Stock Co.,Ltd. (002575.SZ) on Jan .6 increased holding 11.35 million shares of the company with over 200 million yuan at an average price of 17.93 yuan per share, accounting for 1.93 percent of its total shares, and will continue to increase shareholding in the company. Jinggong Holding Group, controlling shareholder of Changjiang ＆ Jinggong Steel Building (Group) Co., Ltd. (600496.SH), and senior management of the latter increased holding 13.89 million shares of the company at an average price of 5.54 yuan per share from Jan 5 to 6, accounting for 0.92 percent of its total shares. The substantial shareholder and actual controller of Bluefocus Communication Group Co., Ltd. (300058.SZ) on Jan. 6 increased holding 13.23 million shares of the company, accounting for 0.68 percent of its total shares. Angel Group, controlling shareholder of Angel Yeast Co., Ltd. (600298.SH) increased holding 2.02 million shares of the company at an average price of 28.95 yuan per share from Jan 5 to 6, accounting for 0.61 percent of its total shares.
Guo Rui, general manager of Meisheng Cultural ＆ Creative Corp., Ltd. (002699.SZ), increased holding 446,000 shares of the company at an average price of 45.28 yuan on Jan. 6. The company's actual controller, directors, supervisors and senior management promised not to reduce their shareholding before Sept. 11. Yizhang County Electric Power Company, controlling shareholder of Hunan Chendian International Development Co., Ltd., (600969.SH), increased holding 1.43 million shares of the company on Jan. 5. Li Ruijie, actual controller of Shenzhen Zqgame Co., Ltd.(300052.SZ), increased holding 1.01 million shares of the company at an average price of 24.44 per share on Jan. 6. Unicom Group, controlling shareholder of China United Network Communications Limited (600050.SH), increased holding 51.12 million shares of the company with over 300 million yuan.
[Financial Reports Express]
○Hubei Golden Ring and others propose high share conversion and dividend
------
Hubei Golden Ring Co., Ltd. (000615.SZ) proposes a 10-for-10 conversion of capital surplus into shares combined with 1 yuan dividend for every 10 shares according to its annual report. Jiangsu Xiuqiang Glasswork Co., Ltd. (300160.SZ) proposes a 22-for-10 conversion of capital surplus into shares combined with cash dividend according to its annual report. Tianrun Crankshaft Co.,Ltd. (002283.SZ) proposes a 10-for-10 conversion of capital surplus into shares combined with cash dividend according to its annual report.
[TOP]
○Silver Age Sci ＆ Tech, Shuanglin Auto Parts ＆ Shenghua Biok Biology forecast growth
------
Guangdong Silver Age Sci ＆ Tech Co., Ltd. (300221.SZ) forecasts its net profit to grow 70 to 100 percent year on year on its annual report mainly due to remarkable increase in gross profits. Ningbo Shuanglin Auto Parts Co., Ltd. (300100.SZ) forecasts its net profit to grow 70 to 100 percent year on year on its annual report mainly because it integrates the financial statement of Hubei New Torch Science ＆ Technology Co., Ltd. Zhejiang Shenghua Biok Biology Co., Ltd. (600226.SH) forecasts its net profit to grow 50 to 100 percent year on year on its annual report mainly due to the increase in the net profit of its joint venture: Qingdong Yebio Bio-tech Co., Ltd. and Caitong Fund Management Co., Ltd.
[Trading Trends]
○Four institutions bought AnYang Iron ＆ Steel
------
The trading volume ranking list on Jan. 6 shows that AnYang Iron ＆ Steel Inc. (600569.SH) was bought by four institutions with a total amount of 103 million yuan, accounting for 20.6 percent of its intraday turnover. No institutional seat sold it. In addition, institutes also bought other iron and steel stocks on the trading volume ranking list. One institutional seat bought Hebei Iron And Steel Co., Ltd. (000709.SZ) with 39.81 million yuan. One institutional seat bought Pangang Group Vanadium Titanium ＆ Resources Co., Ltd. (000629.SZ) with 37.27 million yuan.
Comment: Institutions believe that as this is the first year for the supply-side reform which will eliminate iron and steel production and other backward productive capacity and improve product prices. Listed company will benefit from the rising product products, stoking up expectations for performance improvement.
Latest comments