[Today's Guide]
○ Guidance on civil-military integration in national defense to release, boost military reform
○ Nine ministries and commissions issues strengthening control of ecological red line in resources environment, environment monitoring continues to boom
○ Shunfa Hengye completes private placement with high premiums, Guodian Nanjing Automation and Newland Computer to resume trading
○ Taobao buy shares of Suning Commerce at premiums, Guirenniao to control JZX-Sports
[SSN Focus]
○ Guidance on civil-military integration in national defense to release, boost military reform
------
SSN learns that a great number of documents on civil-military integration will be unveiled in the next half year. The guidance on civil-military integration in the science technology and industry for national defense is likely to be released in the next two months, which will further pave the way for the implementation of the civil-military integration strategy. Xinhua News Agency reported on June 1 that the Central Military Commission of the Chinese Communist Party recently issued the opinions on strengthening the construction of military regulations and system when deepening the reform in national defense and military. The PLA Daily commented on June 2 that the move will provide strong legal guarantee for military reform.
Comment: As China is rising as a power, there is a huge room for military equipment to expand in China. Private enterprises that are qualified to be engaged in the military industry are expected to see huge market potential. Military research institutes can cooperate with private enterprises, during which they can motivate employees with more effective incentive mechanism to improve operation efficiency. Among listed companies, Sanlux Co., Ltd. (002224.SZ) is actively developing unmanned underwater vehicles, micro/nano satellite and quantum communication. Changsha Jingjia Microelectronics Co., Ltd. (300474.SZ) enjoys absolute advantages in plotting board control for airborne avionics system in China. Sichuan Jiuyuan Yinhai Software Co., Ltd. (002777.SZ) is a key pillar enterprise under China Academy Of Engineering Physics that transforming military to civilian industry in the electronic information field.
[SSN Selection]
○ China Minmetals Corporation and the Metallurgical Corporation of China held a restructuring conference on June 2. According to Xinhua News' Weibo, the new company will be a pilot company for state-owned asset investment.
○ The Chinese government released on its website the regulations on irrigation and water conservancy on June 2, encouraging and guiding social force to participate in irrigation and water conservancy projects.
○ Huo Ruirong, deputy director of China Securities Regulatory Commission Shanghai office, indicated on June 2 that it will be a pity if the MSCI Emerging Market Index does not include A shares, and regulators will be optimistic about the inclusion.
○ A research team in the University of Science and Technology of China led by professor Pan Jianwei developed 100 millisecond high-efficiency quantum memory, laying a foundation for ultra-distance quantum communication.
○ Beijing Leshi Internet Information ＆ Technology Corp. (300104.SZ) will resume trading on June 3. It plans to acquire Le Vision Pictures for 9.8 billion yuan in cash and by issuing shares through private placement.
TOP
[Industry Information]
○ Nine ministries and commissions issues strengthening control of ecological red line in resources environment, environment monitoring continues to boom
------
The National Development and Reform Commission (NDRC) and other 8 ministries and commissions recently issued the guidance on strengthening control of ecological red line in resources environment. The guidance points out that China will set goals for air, water and soil quality based on different phases and regions, reinforce control of total pollutant emissions in different regions and industries, strictly prevent emergent environmental accidents, strengthen statistical monitoring ability, establish red line monitoring network system by using informatization, big data, satellite remote sensing and unmanned aerial vehicle, and cover key control areas.
Comment: Ecological environment monitoring is the foundation for ecological environmental protection. Institutes believe that as the new environmental protection law was issued, along with polices on improving sewage discharge standards and government's taking back monitoring power, the environment monitoring will continue to boom during the 13th Five-Year Plan period. Among listed companies, Hebei Sailhero Environmental Protection High-tech Co., Ltd. (300137.SZ) has entered the environment monitoring industry for long, and takes a leading position in the PM 2.5 monitoring product market. Focused Photonics (Hangzhou), Inc. (300203.SZ) is a high-end monitoring device supplier, and is involved in air monitoring and water conservancy monitoring.
○ Mi Band 2 launches, boost wearable industry development
------
Mi Band 2 was officially launched on June 2 and will open to sell on June 7, and its price is 149 yuan. It is reported that the biggest improvement of the new band lies in its LED screen. The new product is equipped with heart rate sensor, enabling it to measure heart rate. Currently, thanks to Mi Band, Xiaomi has become the world's second largest wearable maker. In addition, it is reported that Sumsung will launch new band and sports bluetooth headset.
Comment: Institutes expect that driven by mobile Internet, big data and other technologies, wearable will see rapid development. Global wearable sales will reach 485 million units in 2018, with an annual compound annual growth rate of 59%. Among listed companies, Huizhou China Eagle Electronic Technology Co., Ltd. (002579.SZ) is actively developing printed circuit board for intelligent wearable. Shenzhen Fenda Technology Co., Ltd. (002681.SZ) owns wearable devices, such as intelligent band, intelligent watch, and is improving its layout in the industry chain.
TOP
[Announcement Interpretation]
○ Hangmin Group fully subscribes shares issued through private placement by Shunfa Hengye with premiums
------
Shunfa Hengye Corporation (000631.SZ) raised nearly 1.6 billion yuan by issuing 266 million shares at 6.01 yuan per share through private placement. Zhejiang Hangmin Group, the controlling shareholder of Zhejiang Hangmin Co., Ltd. (600987.SH), fully subscribed all shares and became its second biggest shareholder with 10.94 percent equities in the company. The subscription price represent a premium of 18.8 percent over its latest stock price of Shunfa Hengye, which is 5.06 yuan.
○ Guodian Nanjing Automation and Newland Computer to resume trading after private placement
------
Guodian Nanjing Automation Co., Ltd. (600268.SH) intends to raise approximately 384 million yuan by issuing shares at 6.47 yuan per share to its controlling shareholder through private placement. The proceeds will be used in repaying the special debts to China Huadian Corporation. The stock price of the company was 6.81 yuan before trading suspension.
Fujian Newland Computer Co., Ltd. (000997.SZ) proposes to raise 1.9 billion yuan for the construction of the commercial customers service system and network and the establishment of an intelligent payment research and development center. The pricing benchmark day is the day on which the resolution of the general meeting is made. Currently, the company directly and indirectly acquired 100 percent equities of Fujian Guotong Xingyi Network Technology Co., Ltd. with 680 million yuan from its own capital. It also fully controls the Newland Payment Technology through private placement and preliminarily established a complete e-payment industrial chain with the integration of the research and development of terminals, sales and the operation and maintenance services for commercial customers.
TOP
○ Suning Commerce completes private placement with high premium, Taobao becomes its shareholder
------
Suning Commerce Group Co., Ltd. (002024.SZ) raised a net proceed of 29.1 billion yuan by issuing 1.93 billion shares at 15.17 yuan per share. Taobao (China) Software subscribed 28.2 billion yuan and the phase-II employees shareholding plan subscribed 1 billion yuan. The proceeds will be invested in the construction of a logistics platform, the development of the cloud store of Suning.com, an Internet-based financial project, an IT program, repaying debts and supplementing the working capital. Taobao became the second biggest shareholder of the company. The latest stock price of the company is only 11.06 yuan.
○ Guirenniao to control JZX-Sports with RMB383 mln
------
Guirenniao Co., Ltd. (603555.SH) intends to acquire equities of JZX-Sports and increase the investment in it with 380 million yuan. The company will hold 50.01 percent shares of JZX-Sports and become its controlling shareholder after the completion of the transaction.
JZX-Sports is a professional retailer of sports products. It recorded a net profit of 40 million yuan in 2015. It committed that the net profit in 2016 will be no less than 50 million yuan and the total net profit for the following three years will be no less than 200 million yuan.
○ Kingdom Sci-tech to introduce phase-II employee shareholding plan
------
Shenzhen Kingdom Sci-tech Co., Ltd. (600446.SH) released the draft of its phase-II employee shareholding plan, which plans to raise a maximum of 56 million yuan. It will establish collective asset management plan with no more than 280 million yuan to purchase and hold the stocks of the company.
[Trading Trends]
○ Four institutional seats buy Sino-Microelectronics
------
The trading volume ranking list on June 2 shows that four institutional seats bought Jilin Sino-Microelectronics Co., Ltd. (600360.SH) with a total of 152 million yuan, accounting for 38 percent of its intraday turnover.
Comment: The company is a leader in the power semiconductor device industry. Institutes believe that new energy vehicles and the charging equipment have a huge demand for IGBT chips and modular products. The local demand can reach 60 billion yuan. The company has the capacity of "actual mass production". It is expected to achieve the huge production of high value-added products thanks to the booming demand. The profitability is expected to improve significantly.
TOP
○ Guidance on civil-military integration in national defense to release, boost military reform
○ Nine ministries and commissions issues strengthening control of ecological red line in resources environment, environment monitoring continues to boom
○ Shunfa Hengye completes private placement with high premiums, Guodian Nanjing Automation and Newland Computer to resume trading
○ Taobao buy shares of Suning Commerce at premiums, Guirenniao to control JZX-Sports
[SSN Focus]
○ Guidance on civil-military integration in national defense to release, boost military reform
------
SSN learns that a great number of documents on civil-military integration will be unveiled in the next half year. The guidance on civil-military integration in the science technology and industry for national defense is likely to be released in the next two months, which will further pave the way for the implementation of the civil-military integration strategy. Xinhua News Agency reported on June 1 that the Central Military Commission of the Chinese Communist Party recently issued the opinions on strengthening the construction of military regulations and system when deepening the reform in national defense and military. The PLA Daily commented on June 2 that the move will provide strong legal guarantee for military reform.
Comment: As China is rising as a power, there is a huge room for military equipment to expand in China. Private enterprises that are qualified to be engaged in the military industry are expected to see huge market potential. Military research institutes can cooperate with private enterprises, during which they can motivate employees with more effective incentive mechanism to improve operation efficiency. Among listed companies, Sanlux Co., Ltd. (002224.SZ) is actively developing unmanned underwater vehicles, micro/nano satellite and quantum communication. Changsha Jingjia Microelectronics Co., Ltd. (300474.SZ) enjoys absolute advantages in plotting board control for airborne avionics system in China. Sichuan Jiuyuan Yinhai Software Co., Ltd. (002777.SZ) is a key pillar enterprise under China Academy Of Engineering Physics that transforming military to civilian industry in the electronic information field.
[SSN Selection]
○ China Minmetals Corporation and the Metallurgical Corporation of China held a restructuring conference on June 2. According to Xinhua News' Weibo, the new company will be a pilot company for state-owned asset investment.
○ The Chinese government released on its website the regulations on irrigation and water conservancy on June 2, encouraging and guiding social force to participate in irrigation and water conservancy projects.
○ Huo Ruirong, deputy director of China Securities Regulatory Commission Shanghai office, indicated on June 2 that it will be a pity if the MSCI Emerging Market Index does not include A shares, and regulators will be optimistic about the inclusion.
○ A research team in the University of Science and Technology of China led by professor Pan Jianwei developed 100 millisecond high-efficiency quantum memory, laying a foundation for ultra-distance quantum communication.
○ Beijing Leshi Internet Information ＆ Technology Corp. (300104.SZ) will resume trading on June 3. It plans to acquire Le Vision Pictures for 9.8 billion yuan in cash and by issuing shares through private placement.
TOP
[Industry Information]
○ Nine ministries and commissions issues strengthening control of ecological red line in resources environment, environment monitoring continues to boom
------
The National Development and Reform Commission (NDRC) and other 8 ministries and commissions recently issued the guidance on strengthening control of ecological red line in resources environment. The guidance points out that China will set goals for air, water and soil quality based on different phases and regions, reinforce control of total pollutant emissions in different regions and industries, strictly prevent emergent environmental accidents, strengthen statistical monitoring ability, establish red line monitoring network system by using informatization, big data, satellite remote sensing and unmanned aerial vehicle, and cover key control areas.
Comment: Ecological environment monitoring is the foundation for ecological environmental protection. Institutes believe that as the new environmental protection law was issued, along with polices on improving sewage discharge standards and government's taking back monitoring power, the environment monitoring will continue to boom during the 13th Five-Year Plan period. Among listed companies, Hebei Sailhero Environmental Protection High-tech Co., Ltd. (300137.SZ) has entered the environment monitoring industry for long, and takes a leading position in the PM 2.5 monitoring product market. Focused Photonics (Hangzhou), Inc. (300203.SZ) is a high-end monitoring device supplier, and is involved in air monitoring and water conservancy monitoring.
○ Mi Band 2 launches, boost wearable industry development
------
Mi Band 2 was officially launched on June 2 and will open to sell on June 7, and its price is 149 yuan. It is reported that the biggest improvement of the new band lies in its LED screen. The new product is equipped with heart rate sensor, enabling it to measure heart rate. Currently, thanks to Mi Band, Xiaomi has become the world's second largest wearable maker. In addition, it is reported that Sumsung will launch new band and sports bluetooth headset.
Comment: Institutes expect that driven by mobile Internet, big data and other technologies, wearable will see rapid development. Global wearable sales will reach 485 million units in 2018, with an annual compound annual growth rate of 59%. Among listed companies, Huizhou China Eagle Electronic Technology Co., Ltd. (002579.SZ) is actively developing printed circuit board for intelligent wearable. Shenzhen Fenda Technology Co., Ltd. (002681.SZ) owns wearable devices, such as intelligent band, intelligent watch, and is improving its layout in the industry chain.
TOP
[Announcement Interpretation]
○ Hangmin Group fully subscribes shares issued through private placement by Shunfa Hengye with premiums
------
Shunfa Hengye Corporation (000631.SZ) raised nearly 1.6 billion yuan by issuing 266 million shares at 6.01 yuan per share through private placement. Zhejiang Hangmin Group, the controlling shareholder of Zhejiang Hangmin Co., Ltd. (600987.SH), fully subscribed all shares and became its second biggest shareholder with 10.94 percent equities in the company. The subscription price represent a premium of 18.8 percent over its latest stock price of Shunfa Hengye, which is 5.06 yuan.
○ Guodian Nanjing Automation and Newland Computer to resume trading after private placement
------
Guodian Nanjing Automation Co., Ltd. (600268.SH) intends to raise approximately 384 million yuan by issuing shares at 6.47 yuan per share to its controlling shareholder through private placement. The proceeds will be used in repaying the special debts to China Huadian Corporation. The stock price of the company was 6.81 yuan before trading suspension.
Fujian Newland Computer Co., Ltd. (000997.SZ) proposes to raise 1.9 billion yuan for the construction of the commercial customers service system and network and the establishment of an intelligent payment research and development center. The pricing benchmark day is the day on which the resolution of the general meeting is made. Currently, the company directly and indirectly acquired 100 percent equities of Fujian Guotong Xingyi Network Technology Co., Ltd. with 680 million yuan from its own capital. It also fully controls the Newland Payment Technology through private placement and preliminarily established a complete e-payment industrial chain with the integration of the research and development of terminals, sales and the operation and maintenance services for commercial customers.
TOP
○ Suning Commerce completes private placement with high premium, Taobao becomes its shareholder
------
Suning Commerce Group Co., Ltd. (002024.SZ) raised a net proceed of 29.1 billion yuan by issuing 1.93 billion shares at 15.17 yuan per share. Taobao (China) Software subscribed 28.2 billion yuan and the phase-II employees shareholding plan subscribed 1 billion yuan. The proceeds will be invested in the construction of a logistics platform, the development of the cloud store of Suning.com, an Internet-based financial project, an IT program, repaying debts and supplementing the working capital. Taobao became the second biggest shareholder of the company. The latest stock price of the company is only 11.06 yuan.
○ Guirenniao to control JZX-Sports with RMB383 mln
------
Guirenniao Co., Ltd. (603555.SH) intends to acquire equities of JZX-Sports and increase the investment in it with 380 million yuan. The company will hold 50.01 percent shares of JZX-Sports and become its controlling shareholder after the completion of the transaction.
JZX-Sports is a professional retailer of sports products. It recorded a net profit of 40 million yuan in 2015. It committed that the net profit in 2016 will be no less than 50 million yuan and the total net profit for the following three years will be no less than 200 million yuan.
○ Kingdom Sci-tech to introduce phase-II employee shareholding plan
------
Shenzhen Kingdom Sci-tech Co., Ltd. (600446.SH) released the draft of its phase-II employee shareholding plan, which plans to raise a maximum of 56 million yuan. It will establish collective asset management plan with no more than 280 million yuan to purchase and hold the stocks of the company.
[Trading Trends]
○ Four institutional seats buy Sino-Microelectronics
------
The trading volume ranking list on June 2 shows that four institutional seats bought Jilin Sino-Microelectronics Co., Ltd. (600360.SH) with a total of 152 million yuan, accounting for 38 percent of its intraday turnover.
Comment: The company is a leader in the power semiconductor device industry. Institutes believe that new energy vehicles and the charging equipment have a huge demand for IGBT chips and modular products. The local demand can reach 60 billion yuan. The company has the capacity of "actual mass production". It is expected to achieve the huge production of high value-added products thanks to the booming demand. The profitability is expected to improve significantly.
TOP
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