[Today's Guide]
○Big data summit held, technology application admired by Chinese Premier Li
○Nuclear orders to speed up, feed and vaccine industries likely to boom
○Molybdenum to acquire overseas mineral assets, Hebang Biotechnology to see shareholding increase
○Clou Electronics works with LG Chem, Yunyi Electric to control new energy vehicle manufacturer
[SSN Focus]
○Big data summit held, technology application admired by Chinese Premier Li
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Chinese Premier Li Keqiang on May 25 attended the China Big Data Summit in Guiyang city, The Xinhua News Agency reported. When Li looked around the big data achievements of Guiyang, officer in charge of 56QQ.com introduced that they connect 300,000 clients and 1.7 million truck drivers nationwide through internet, and create a road logistics information platform covering the whole China, which reduces the unloaded ratio by 6 percent. Li admired that what they have done is meaningful, and new technologies including big data and Internet of Things will provide services for citizens at the last.
Comment: Institutions pointed out that this summit fully upgrades, with much larger scale and class than previous ones, showing national high attention on big data. China's big data industrial scale is estimated to gain an annual growth rate of over 50 percent in the coming five years, according to Lin Nianxiu, vice director of National Development and Reform Commission. Among the listed companies, Shenzhen Tianyuan Dic Information Technology Co., Ltd. (300047.SZ) intensifies the strength to build up big data platform related to public security affairs cloud and local operators; United Electronics Co., Ltd. (002642.SZ) deploys for big data applications, and institutions are optimistic about its biometrics cloud computing and car networking businesses; Transfar Logistics Co., Ltd. wholly held by Zhejiang Transfar Co., Ltd. (002010.SZ) devotes itself to creating road logistics platform, and its businesses have common points with those of 56QQ.com.
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[SSN Selection]
○Effort will be made to further improve the listing mechanism of futures products and boost the two-way openness of the market, according to Fang Xinghai, vice president of China Securities Regulatory Commission.
○The Minsitry of Industry and Information Technology on May 25 issued a notice to carry out special supervision and investigation on energy conservation of China's major industries, and reinforce the related management in the industries including steel.
○The monthly "4 1" meeting involving the four largest coal enterprises will be held in this week, and it is very likely to raise the price of underwater steam coal.
○China's petrol and diesel prices will increase 210 yuan and 200 yuan per ton respectively from 24:00 of May 25. The growth rates are higher than those of the last two times.
○The final rate of successful online subscription is 0.2798 percent for China Nuclear Engineering Corporation Limited (601611.SH), the highest since new market ration rule.
[Industrial Information]
○No. 2 nuclear units in Fangchenggang initially finished fuel loading, nuclear order determination speeds up
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The website of China General Nuclear Power Corporation (CGN) on May 25 revealed that No.2 units of Guangxi Fangchenggang Nuclear Power Co., Ltd. finished the nuclear fuel loading for the first time, marking a crucial step of the said units' way to operate. In 2015, China gradually opened the review ＆ approval of newly constructed nuclear projects, with No.5 and 6 units of Fuqing city, Fujian province and two units of Nuclear Project Phase II in Fangchenggang approved one by one. Along with supporting equipment tender, the demands for nuclear island, conventional island and butterfly valve will be realized at a quicker pace.
Comment: Currently, Hualong No.1 technology actively promoted by China requires that the localization ratio of key materials should be no less than 85 percent. Along with accelerating construction for domestic nuclear projects and expanding export market, the demands for nuclear equipment will see a substantial expansion period. Securities companies expect that nuclear equipment investment will reach 360 billion yuan by 2020. Jiangsu Shentong Valve Co., Ltd. (002438.SZ) is a leading enterprise in nuclear butterfly valve in China. Anhui Yingliu Electromechanical Co., Ltd. (603308.SH) is mainly engaged in treating shell of main nuclear pump and nuclear wastes.
○Number of remaining sows in farms sets new high, feed and vaccine industries likely to boom
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Based on the website of Ministry of Agriculture on May 24, Ma Youxiang, head of animal husbandry department, MOA, indicated that although pig price constantly gains slight increase recently, but at the present, newly added pig feeding is over hot, and the capacity recovers quickly. Based on fixed-point monitoring of the MOA, pig remaining in the farms increased 0.6 percent month on month in April, growth for a second consecutive month. The remaining sows able to reproduce pigs increased month on month for the first time after continuous 36-month decline, and its decrease rate year on year also narrowed rapidly. It shows that pig production has touched the bottom and rebounded, and gradually steps into a growth channel.
Comment: Along the increasing number of pigs left in the farms, the downstream demands for afterwards feeding industries, such as feed and animal vaccines, are likely to further increase, and the industries will see booming uptrend. In terms of listed companies, Beijing Dabeinong Technology Group Co., Ltd. (002385.SZ) is the largest enterprise producing gunk in China; feed sales of Jiangxi Zhengbang Technology Co., Ltd. (002157.SZ) accounts for nearly 90 percent in its main businesses, with market share ranking high domestically; Jinyu Bio-technology Co., Ltd. (600201.SH) is mainly engaged in biological products for animals.
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[Announcement Interpretation]
○Molybdenum to acquire overseas mineral assets at USD4.15 bln
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China Molybdenum Co., Ltd. (603993.SH) plans to acquire overseas niobium-phosphorus business and copper-cobalt business by paying 1.5 billion U.S. dollars and 2.65 billion U.S. dollars in cash respectively. The object of the first business is AANB, which is one of the world's three largest niobium ore producers, and AAFB owns the P2O5 resources with the best taste in Brazil. After the acquisition, the company will indirectly hold 100 percent equity in AAFB and AANB respectively, allowing itself to own niobium and phosphorus businesses under Anglo American plc. in Brazil.
The object of copper-cobalt business is FMDRC, which directly has 56 percent equity of TFM located in Congo (Kinshasa). The Tenke Fu1ngurume mine area owned by TFM is one of the copper-cobalt producers with the biggest reserve and highest taste in the country, and it is also the biggest foreign investment project in the country. The listed company will gain 100 percent equity of FMDRC.
○Controlling shareholder of Hebang Biotechnology to increase shareholding
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Controlling shareholder of Sichuan Hebang Biotechnology Co., Ltd. (603077.SH) plans to incease shareholding in the company at no less than 100 million yuan in next six months. Zhong Yitai, president of Shenzhen Maxonic Automation Control Co., Ltd. (300112.SZ) increased shareholding in the company by 710,000 shares on May 24.
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○Clou Electronics works with LG Chem to deploy in stored battery
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Shenzhen Clou Electronics Co., Ltd. (002121.SZ) plans in invest 2.45 million U.S. dollars to jointly establish Shenzhen Kele New Energy Technology Co., Ltd. with LG Chem and it will hold 70 percent in the joint venture. The joint venture company will be specialized in producing, marketing and supporting services of stored battery and is going to produce more than 400MWh battery packs annually in phase one.
Energy storage device and energy storage for electric vehicle are becoming new contributor for the market. The cells offered by LG Chem, the largest global stored battery provider, have super stability and cycle life and excellent cost competitiveness.
○Yunyi Electric to control new energy vehicle manufacturer at RMB172 mln
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Jiangsu Yunyi Electric Co., Ltd. (300304.SZ) plans to acquire 51 percent equity of Shanghai Leckon Electrical Technology Co. Ltd. (300304.SZ) at 172 million yuan. Leckon Electrical Technology is principally engaged in the R＆D and production of electric motor and drive control system of electric motor foe new energy vehicle. Operating revenues and net profits of Yunyi Electric recorded 97.03 million yuan and 9.71 million yuan in 2015 respectively, and its total asset registered 92.38 million yuan and net asset posted 16.07 million yuan as of end 2015. The assessed appreciation rate of this acquisition is 2014 percent.
Leckon Electrical has the ability of R＆D, testing and manufacturing of permanent magnet synchronous motor (PMSM) for pure electric vehicle and hybrid electric vehicle and PMSM's drive control system. Based on performance commitment, its net profits will reach 16.5 million yuan, 28.6 million yuan and 41.8 million yuan during 2016 and 2018 respectively.
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○Reorganization proposals of Boway Alloy Material and Zhongli Science And Technology Group approved
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Reorganization proposals of Ningbo Boway Alloy Material Co., Ltd. and Zhongli Science And Technology Group Co., Ltd. (002309.SZ) were approved by China Securities Regulatory Commission unconditionally.
○Dynavolt Renewable Energy Technology to build PV power station in Shaanxi
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Guangdong Dynavolt Renewable Energy Technology Co., Ltd. (002684.SZ) intends to totally invest 5.62 billion yuan to build a 500WMh storage energy power station, 100MW ground PV power station, 100MW wind power station, 50MW thermosolar plant and relevant renewable energy power generation facilities in Dingbian county of Shaanxi province within four years, so as to a larger renewable energy power generation center and storage application comprehensive demonstration center in Northwest China. Meanwhile, the company intends to cooperate with Global Discovery AG in renewable energy and energy storage fields and build 322.5MW solar power station in Iran and Africa.
[Trading Trends]
○Jingxing Paper Joint Stock bought through three institutional seats
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The trading volume ranking list on May 25 shows that Zhejiang Jingxing Paper Joint Stock Co., Ltd. (002067.SZ) was bought through three institutional seats with a total of 296 million yuan, accounting for 34 percent of its intraday turnover.
Comment: Papermaking industry in which the company is engaged shows signs of weak recovery and the company's investment in venture capital and other new businesses are gradually making contribution to profits. As the company gained a great deal of investment income after reducing shareholdings in Zhejiang Shapuaisi Pharmaceutical Co., Ltd. in February, it predicts its net profits will increase by 25.6-27.6 times in the first half of this year. The company indicated in a recent survey by institution that it would continue to invest in big health, robot, environmental protection and other fields.
◆China Wafer Level CSP Co., Ltd. (603005.SH) was bought through three institutional seats with a total of 270 million yuan via block trade and with a total of nearly 315 million yuan in the same way
[Trading Alarms]
○Hugong Electric to launch IPO on May 26
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Shanghai Hugong Electric (Group) Co., Ltd. is going to launch IPO at 10.09 yuan per share with an upper limit of 10,000 shares for each account. The PE ratio is 23 times. The company is principally engaged in manufacturing welding equipment.
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