[Today's Guide]
○ Pilot measures on mortgage loans with "two rights" released to revitalize land assets
○ Qinghai Lithium solves difficulties in industry, extraction of lithium in salt lakes sees breakthroughs
○ Sun Create Electronics to buy military radar assets, Great Wall Movie and Television to acquire advertisement companies again
○ Chengtun Mining to expand financial services for metal industrial chain, multiple companies propose high share conversion and dividend in their annual reports
[SSN Focus]
○ Pilot measures on mortgage loans with "two rights" released to revitalize land assets
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The central bank announced on March 24 on its website that it and relevant ministries jointly release the Interim Measures for Pilot on Mortgage Loans with the Operation Right on Contracted Land in Rural Areas and the Interim Measures for Pilot on Mortgage Loans with Housing Property Right of Farmers, which set specific requirements on the pilot on mortgage loans with the "two rights".
Comment: The pilot on mortgage loans with the "two rights" will revitalize land assets, facilitate agricultural modernization and income increase of farmers as well as provide experiences in steadily advancing the land reform in rural areas. The outline of the 13th Five-year Plan proposes to improve the division of the ownership, contract and operation rights of land and legally promote the orderly transfer of the operation right of land. Based on research reports of institutes, Gansu Yasheng Industrial (Group) Co., Ltd. (600108.SH), Heilongjiang Agriculture Company Limited (600598.SH) and other companies engaged in agricultural reclamation with huge land resources as well as First Tractor Company Limited (00038.HK; 601038.SH), Thinker Agricultural Machinery Co., Ltd. (603789.SH) and other agricultural machinery companies benefiting from moderate operation will catch more attention.
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[SSN Selection]
○ Chinese Premier Li Keqiang announced at the opening ceremony of the opening ceremony of the Boao Forum for Asia 2016 annual conference on March 24 that China will launch Shenzhen-Hong Kong Stock Connect this year.
○ The Ministry of Finance and the State Administration of Taxation jointly released detailed rules on replacing business tax with value-added tax (VAT). The sale of residential houses bought over two years ago will be exempt from levying VAT.
○ Eastday.com reported that the Shanghai Municipal Party Committee held an executive meeting on March 24, which emphasized the strict implementation of the Certain Opinions on Further Improving the Housing Market System and Guarantee System in Shanghai to Facilitate the Stable and Healthy Development of the Real Estate Market to be released soon.
○ Foreign Ministry spokesperson indicated that the U.S. has officially invited China to participate in the 2016 Pacific Rim Joint Military Exercise and the Chinese side has determined to send warships to participate in it.
○ China Vanke Co., Ltd. (02202.HK; 000002.SZ) released an announcement on The Stock Exchange of Hong Kong Limited, saying that besides Shenzhen Metro Group Co., Ltd., it is negotiating and discussing with a number of potential parties.
[Industry Information]
○Qinghai Lithium solves difficulties in industry, extraction of lithium in salt lakes sees breakthroughs
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The Ministry of Land and Resources discloses on its website on March 24 that the battery grade lithium carbonate of Qinghai Lithium Co., Ltd. sold well with a profit of over 130 million yuan, setting a new record. It is reported that the core technologies in the lithium carbonate manufactured by Qinghai Lithium have reached the advanced level in the world. It also make breakthroughs in the separation of magnesium lithium.
Comment: Driven by the increase in the scales of new energy vehicles, the demand for battery grade lithium carbonate surges and the market price also hikes significantly. The technical breakthroughs of Qinghai Lithium provides experiences in the extraction of lithium in salt lakes. The value of salt lakes will also increase. Among listed companies, the equity reserve of lithium carbonate in the Zabuye Salt Lake under Tibet Mineral Development Co., Ltd. (000762.SZ) is 1,155,000 tons with a magnesium to lithium ratio of 0.23. The grade is relatively high. The equity reserve of lithium carbonate in two slat lakes under Tibet Urban Development and Investment Co., Ltd. (600773.SH) is 1,636,000 tons. The exploration is speeding up.
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○ China pushes for dialogue among Asian civilizations, Chinese culture to go out rapidly
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Chinese Premier Li Keqiang indicated in a speech at the Boao Forum for Asia on March 24 that China proposes a conference for dialogue among Asian civilizations. Jiang Jianguo, head of the State Council Information Office, indicated on March 23 that it is a major task to promote dialogue, exchanges and mutual learning among Asian civilizations. China suggests that the dialogue among Asian civilizations should be held regularly to provide spiritual motive for the cooperation and development of Asia and establish diversified channels for dialogues among Asian civilizations.
Comment: Institutes believe that driven by policies, Chinese culture will go out rapidly. National press platforms and companies with high-quality contents will welcome new opportunities. People.cn Co., Ltd. (603000.SH) is a national-level media publicity platform. The series made by Beijing Hualu Baina Film ＆ TV Inc. (300291.SZ) have been exported to Asia-Pacific, Europe, America and Africa.
[Announcement Interpretation]
○ Sun Create Electronics to buy military radar assets
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Anhui Sun Create Electronics Co., Ltd. (600990.SH) proposes to issue 18,190,000 shares through private placement at 61.68 yuan per share to raise 1,122 million yuan for the purchase of 100 percent shareholding in Anhui Bowei Changan Electronics, which is held by Sun Create Electronics' controlling shareholder; meanwhile, the company proposes to raise supporting fund of 706 million yuan by issuing shares through private placement at 61.68 yuan per share. The main business of Bowei Changan is consisted of three parts: medium and minimum altitude warning radar and sea surface and low altitude warning radar equipment, mobile protection equipment and information-based transformation for grain storage. Warning radar equipment and mobile protection equipment are largely classified as military business.
○ Great Wall Movie and Television to acquire advertisement companies again with RMB450 mln
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Great Wall Movie and Television Co., ltd. (002071.SZ) proposes to spend 450 million yuan to purchase 30 percent, 30 percent and 25 percent equity of Tibet Shannan Oriental Longhui Cultural Transmission Co., Ltd., Shanghai Macro Media Group and Shanghai Jiuming Advertisement Company Limited, respectively. Oriental Longhui provide advertisement service for its customers relying on China Central Television's media resources; Macro Media focus on outdoor media in high quality communities; Jiuming Advertisement makes profits by providing advertisement services to customers through media channels of Hunan TV＆Broadcast Intermediary Co., Ltd. (000917.SZ). It is the third consecutive year that Great Wall Movie and Television buy advertisement companies to constantly perfect the whole industry chain.
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○ Chengtun Mining to expand financial services for metal industrial chain
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Chengtun Mining Group Co., Ltd. (600711.SH) proposes to issue 650 million shares through private placement at 5.67 yuan per share to raise 3,688 million yuan, in which the controlling shareholder Chengtun Group will subscribe about 1,021 million yuan. The fundraising is intended for financial services for metal industrial chain, which specifically include commercial factoring business, supply chain financial services and etc.
○ Hangzhou Tigermed Consulting to buy Jietong Tairui, expanding clinical research
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Hangzhou Tigermed Consulting Co., Ltd. (600647.SZ) proposes to raise 779 million yuan by share issuance through private placement at the market price. 600 million yuan of the proceeds will be used for the purchase of Jietong Tairui Medical Science and technology Company Limited. The primary business of Jietong Tairui is the provision of outsourcing services for medical apparatus and instruments (including TVD) enterprises, and the company's net profits in 2015 amounted to 22.21 million yuan. The original shareholder committed that the company's net profits will be no less than 40 million yuan, 48 million yuan and 57.6 million yuan for 2016 to 2018, respectively.
○ Ganfeng Lithium joins hands with Zhongzhi Investment to increase capital in Ankao Energy
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Jiangxi Ganfeng Lithium Co., Ltd. (002460.SZ) proposes to increase capital of 200 million yuan in Ankao Energy Co., Ltd. with Zhongzhi Investment. Ganfeng Lithium will contribute 105 million yuan. Upon completion of the investment, the company will hold 10.5 percent shareholding in the target company. The counterparty committed that the net profits of Ankao Energy will be 100 million yuan, 200 million yuan and 300 million yuan for 2016 to 2018, respectively. Ankao Energy is primarily engaged in the manufacturing and sales of battery equipment, battery and electronic parts and components.
[Financial Reports Express]
○ Multiple companies propose high share conversion and dividend
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Dalian Port (PDA) Company Limited (601880.SH) reported 7 percent decline in its annual report, and proposes 13-for-10 conversion of capital surplus into shares combined with 0.75 yuan dividend for every 10 shares. Henan Tong-Da Cable Co., Ltd. (002560.SZ) reported 24 percent growth in its annual report, and proposes 20-for-10 conversion of capital surplus into shares. Sanchuan Wisdom Technology Co., Ltd. (300066.SZ) reported 11 percent growth in its annual report, and proposes 15-for-10 conversion of capital surplus into shares combined with 0.5 yuan dividend for every 10 shares; the company also expects 20-40 percent in Q1 2016. Beijing Ctrowell Technology Corporation Limited (300455.SZ) reported 13 percent growth in its annual report, and proposes 10-for-10 conversion of capital surplus into shares combined with 1 yuan dividend for every 10 shares; the company expects 20-40 percent growth in the Q1 2016. Lead Eastern Investment Co., Ltd. (000673.SZ) sharply turned losses into profits according to its annual report, and proposes 10-for-10 conversion of capital surplus into shares. Nanjing Huadong Electronics Information ＆ Technology Co., Ltd. (000727.SZ) reported 18 percent growth in its annual report, and proposes 10-for-10 conversion of capital surplus into shares. Sinoma International Engineering Co., Ltd. (600970.SH) reported 348 percent growth in its annual report, and proposes 5-for-10 conversion of capital surplus into shares combined with 1.71 yuan dividend for every 10 shares.
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○ HopeRun Software expects growth in Q1
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Jiangsu HopeRun Software Co., Ltd. (300339.SZ) reported 77 percent growth in its annual report and expects 90-120 percent growth in Q1 2016, primarily due to the combination of Beijing UISF Information Technology Co., Ltd. in its financial statements. Shandong Meichen Science ＆ Technology Co., Ltd. (300237.SZ) reported 102 percent growth in its annual report, and expects 87-120 percent growth in Q1 2016, primarily due to the growth of gardening and tourism businesses. Sunwoda Electronic Co., ltd. (300207.SZ) reported 93 percent growth in its annual report, and expects 100-130 percent growth in Q1 2016, primarily due to the increase of operational revenue.
Zhejiang Century Huatong Group Co., Ltd. (002602.SZ) expects 90-130 percent growth in Q1 2016, primarily due to substantial growth of profits from game and automotive components and parts segments. Hunan Er-Kang Pharmaceutical Co., Ltd. (300267.SZ) expects 68-98 percent growth in Q1 2016, primarily due to continuously increased investment in starch market and participation in the collective bidding for medicine purchase.
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