[Today's Guide]
○Methionine price up by 7 pct., supply-demand situation good for continuous price hike
○CNCA released guidance to support technological innovation, Billions Chemicals to raise titanium dioxide twice in Q2
○Luo Weiguang increases shareholding in Golden Glass Technologies, Jiangxi Special Electric Motor and etc. forecast growth in semiyearly report
○Hiconics Drive Technology proposes high share conversion, Unifull Industrial Fiber bought through three institutional seats
[SSN Focus]
○Methionine price up by 7 pct., supply-demand situation good for continuous price hike
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SSN learnt that driven by industrial synergy and the improving livestock on hand of downstream poultry farming, methionine, a kind of feed additives, experiences continuous price hike and upsurges by nearly 7 percent in recent week.
Comment: Methionine is mainly used as chicken feed additives. As consumption upgrades and popularity of feed additives hikes, the domestic demand for methionine is expected to keep the annual growth of 6 percent. But due to high centralization of methionine industrial capacity, the four major oligopolies account for about 90 percent of global capacity, which will do good to maintain better profitability. In terms of listed companies, Bluestar Adisseo Company (600299.SH) takes up nearly 30 percent of methionine market share in the world and its total capacity is about 400,000 tons. Sichuan Hebang Biotechnology Co., Ltd. (603077.SH) is developing a project with capacity of 100,000 tons of methionine.
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[SSN Selection]
○Premier Li Keqiang visited expressway service area in Ya'an city, Sichuan province on April 25 and indicated it was a good beginning when informed of recovery of dinas price recently.
○The State Council's Decision on Revising Administration Regulations on Vaccine Circulation and Vaccination was released on April 25, strengthening the administration system for vaccine cold chain storage and transportation.
○China's central bank conducts 267-billion-yuan MLF operation on April 25. The total capital injected into the market through MLF is almost equivalent to the capital released through lowering reserve requirement ratio in March.
○Chen Jining, minister of environmental protection, indicated on April 25 that China will introduce and implement soil pollution prevention action plan (the soil ten) this year.
○Whaley Technology Co., Ltd. held a press conference on VR strategy on April 25. President Li Ruigang indicated that the company would make major deployment in such fields as sports, video and film, acting and live entertainment.
[Industry Information]
○CNCA released guidance to support technological innovation and tackle key technology problems
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China National Coal Association (CNCA) released Guidance on Promoting the Scientific and Technological Development of Coal Industry during 13th Five-year Plan period on April 25. The Guidance proposes that capability of independent innovation of China's coal industry will be significantly improved and breakthrough in key technologies will be made by 2020. In addition, problems in eight key technologies should be tackled focusing on safe and green coal exploitation, intelligent mine construction, clear utilization and high-efficiency transformation of coal.
Comment: Institutions believe that coal mining automation and personnel reduction will become a trend in the future, imposing high requirement for coal machine intelligentization. With policy support, investment in coal mine safety production will not be weakened. Uroica Mining Safety Engineering Co., Ltd. (300099.SZ) is principally engaged in coal mine safety control devices and intends to acquire Changchun Shikai Technology Industry Co., Ltd. to make expansion in military engineering field. Zhengzhou Coal Mining Machinery Group Co., Ltd. (601717.SH) is a leading enterprise in fully-mechanized coal mining hydraulic support industry in China.
[Announcement Interpretation]
○Billions Chemicals to raise titanium dioxide twice in Q2, performance expected to surge in 1st half of 2016
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After raising price of rutile titanium dioxide totally by 900 yuan per ton for three times during the first quarter, Henan Billions Chemicals Co., Ltd. (002601.SZ) continue to raise the price by 500 percent on April 6 and 22 respectively. Up to now, average price of the company's principal product have moved up by about 1,900 yuan percent, up by nearly 20 percent.
Comment: The company is specialized in titanium dioxide, which accounts for nearly 87 percent of its operating revenue in 2015. Its performance for the first half of 2016 is expected to surge by 50-100 percent as the company predicts that the price of its principal product titanium dioxide will continue to rise, further improving its profitability.
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○Luo Weiguang increases shareholding in Golden Glass Technologies
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Guangdong Golden Glass Technologies Limited (300093.SZ) released the Report of Change in Equity. Since the company has completed the acquisition of assets and the supporting fundraising by issuing shares, the shareholding of Luo Weiguang and the persons acting in concert rises from 11.24 percent to 27.29 percent (excluding supporting financing) or 29.34 percent (including supporting financing) to reinforce his controlling stake. Luo and the persons acting in concert indicate that further shareholding increase is possible in next 12 months.
Comment: Luo, a former champion of privately-offered fund, has obtained controlling stake of Golden Glass Technologies through previous shareholding increase and the aforesaid capital operation. Considering that Luo is also involved in other projects, it is possible that Luo might make efforts in both primary and secondary markets to push up the market value of the listed company.
○Industrial chain of new energy vehicle embraces explosive performance growth, Jiangxi Special Electric Motor and etc. forecast growth in semiyearly report
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As forecasted in the Q1 report and semiyearly report, Jiangxi Special Electric Motor Co., Ltd. (002176.SZ) expects a growth of 104 percent and 200-250 percent, respectively, due to the financial consolidation of Jiangsu Joylong Automobile Manufacturing Co., Ltd. and Hangzhou Mige Electric Co., Ltd. as well as the increase of sales revenue from lithium carbonate; Jiangxi Ganfeng Lithium Co., Ltd. (002460.SZ) records a growth of 345 percent and 400-450 percent, respectively, due to the rise of both sales price and volume of new energy products; thanks to the hike in both sales quantity and price, Guangzhou Tinci Materials Technology Co., Ltd. (002709.SZ) expects a growth of 485 percent and 430-460 percent, respectively.
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[Financial Reports Express]
○Hiconics Drive Technology proposes high share conversion
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As announced in annual report, Hiconics Drive Technology Co., Ltd. (300048.SZ) reports a growth of 19 percent and proposes a 10-for-10 conversion of capital surplus into shares combined with 0.5 yuan dividend for every 10 shares. The company forecasts a performance growth of 2,017 percent in the Q1 report; Toyou Feiji Electronics Co., Ltd. (300302.SZ) expects a growth of 154 percent and proposes 11-for-10 conversion of capital surplus into shares combined with 0.5 yuan dividend for every 10 shares; Shenzhen Neptunus Bioengineering Co., Ltd. (000078.SZ) reports a performance growth of 1,895 percent and proposes a 15-for-10 conversion of capital surplus into shares; Hebei Hengshui Laobaigan Liquor Co., Ltd. (600559.SH) reports a performance growth of 27 percent and proposes a 15-for-10 conversion of capital surplus into shares combined with 3 yuan dividend for every 10 shares.
○Tech Bank to stop loss by a large margin
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Thanks to price hike of live pigs and the decrease of cost, Ningbo Tech Bank Co., Ltd. (002124.SZ) expects a performance growth of 372 percent in the first quarter and forecasts a profit of 140 million-160 million yuan in semiyearly report which stops loss by a large margin. Due to the financial consolidation of several companies, Shenzhen Mindata Holding Co., Ltd. (002137.SZ) reports a performance growth of 10,556 percent in the first quarter and forecasts a performance growth of 1,151-1,719 percent in semiyearly report.
[Trading Trends]
○Unifull Industrial Fiber bought through three institutional seats
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The trading volume ranking list on April 25 shows that Zhejiang Unifull Industrial Fiber Co., Ltd. (002427.SZ) was bought through three institutional seats with a total of 57.22 million yuan, accounting for 6.3 percent of its intraday turnover.
Comment: Unifull Industrial Fiber recently announced that the 100 percent equities held by Huzhou Unifull Holding Co., Ltd. have been transferred to Suzhou ZY Investment Management Co., Ltd. at 1,896 million yuan. ZY Investment Management, focusing on investment in Internet industry, indicates that it will make full use of its resources and advantages to integrate the asset and business of Unifull Industrial Fiber at proper time to propel diversified development of the listed company.
[TOP]
○Funds newly purchase bulk-holding stocks, stocks seeing excessive drop and weak rebound to embrace investment opportunity
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According to statistics by SSN, the bulk-holding stocks newly purchased by funds in the first quarter of this year include EVE Energy Co., Ltd. (300014.SZ), JiLin Sino-Microelectronics Co., Ltd. (600360.SH), Dahu Aquaculture Co., Ltd. (600257.SH), SJEC Corporation (601313.SH), Jiangsu Yuyue Medical Equipment ＆ Supply Co., Ltd. (002223.SZ), Lvjing Holding Co., Ltd. (000502.SZ), China Dalian International Cooperation (Group) Holdings Ltd. (000881.SZ), Sinopec Shandong Taishan Petroleum Co., Ltd. (000554.SZ) and Beijing Hanbang Technology Corp. (300449.SZ), which are characterized with being held by multiple funds and the shareholding by funds accounts for a high proportion of their tradable shares, large drop of stock price in the first quarter and continuous drop in the second quarter. The shareholdings of funds in Hanbang Technology, Taishan Petroleum, Dalian International and etc. surpassed 6 percent, while Sino-Microelectronics, Yuyue Medical Equipment ＆ Supply, EVE Energy and Dahu Aquaculture were all purchased by over six funds.
[Trading Alarms]
○Jinguan Electric available for subscription on April 26
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Jilin Jinguan Electric Co., Ltd. (300510.SZ), principally engaged in switchgears for intelligent electrical equipment, issues shares at 12.3 yuan per share with an up-limit of 8,500 shares per account. Its P/E ratio is 23 times.
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