[Today's Guide]
○ Two giants to set up Internet-based insurance firm, UBI market to reach RMB30 bln
○ Carbon black prices rise as high as 20 pct., China to increase input in environmental protection in 13th Five-Year Plan period
○ Kingray to transform into licensed financial holding company, reorganization of Tangel Publishing and HNA Infrastructure approved
○ Changyuan Group to acquire intelligent factory to equip company, Jinhong Energy Investment sees shareholding increase plan
[SSN Focus]
○ Two giants to set up Internet-based insurance firm, UBI market to reach RMB30 bln
------
CPIC Property Insurance Co., Ltd. owned by China Pacific Insurance (Group) Co., Ltd. (CPIC) (601601.SH; 02601.HK) signed a strategic cooperation agreement with Baidu to incorporate a new Internet-based insurance company with a registration capital of 2 billion yuan. CPIC indicated that it will integrate its traditional car insurance business with technology with the help of Baidu's big data, map and artificial intelligence and provide more diversified products for the new generation of consumers.
Comment: Based on the analysis of big data of driving behavior, insurance company can differentiate customers and give cheaper quotations to those with good driving habits to seize the rapid-growing vehicle insurance market with lower costs. According to Industrial Securities' estimate, the usage-based insurance (UBI) market is expected to approach 30 billion yuan by 2020. Among A-share companies, Shenzhen Deren Electronic Co., Ltd. (002055.SZ) acquired Italian company Meta System, which will meet insurance companies' demands for car insurance pricing and restoring accident scene. United Electronics Co., Ltd. (002642.SZ ) acquired Internet of vehicles. Its clients include a large number of insurance enterprises and vehicle enterprises. Guangdong Shenglu Telecommunication Tech. Co., Ltd. (002446.SZ) said in its annual report that it would launch various vehicle-mounted intelligent terminals, including automobile data recorder.
[SSN Selection]
○ The communication department of the Ministry of Industry and Information Technology said on June 7 that it will issue the 13th Five-Year Plan for the communication industry. It will accelerate construction of optical network in urban areas and continued to improve 4G network coverage.
○ China's central bank conducted one-month medium-term lending facility (MLF) operations for the first time in 4 months. The injection of long-term capital will help stabilize the market expectations for liquidity.
○ Paulson Institute and other research institutes said in a report released on June 7 that the demands for investment for low-carbon city construction in China is expected to reach 1 trillion U.S. dollars in next 5 years.
○ Chief engineer of China Railway Corporation indicated that there is no technical and safety problems to restore the speed of high-speed rail to 350km/h, but it still should be justified whether to restore the speed.
○ The proportion of investors participating in trading in the A-share market surged to 12.38 percent last week from 12.53 percent a week earlier. The net amount of securities margin transferred was 19.5 billion yuan.
○The price of lithium carbonate declined 9 percent since mid-April. It is learnt that lithium carbonate projects in Sichuan and Qinghai still have difficulties to expand productivity.
TOP
[Industry Information]
○Carbon black prices hike as high as 20 pct.
------
SSN learns that driven by low inventory and rising costs, carbon black prices have hiked from 500 to 1000 yuan per ton, the second hike in the year. The highest increase reaches 20 percent. Owed to excessive productivity, the carbon black market has been sluggish in recent years. Its prices have declined nearly 30 percent since the end of 2013. Some productivity has begun to exit the market. The supply and demand situation in the industry begins to improve.
Comment: The carbon black productivity in China approaches to 7 million tons, accounting for about 42 percent of the world's total productivity, making China the largest carbon black producer in the world. Institutes estimate that the demands for carbon black from downstream tyre and industrial rubber products will grow at an annual rate of nearly 6 percent. The industry's profitability is expected to improve. As for companies, Longxing Chemical Stock Co., Ltd. (002442.SZ) produced 405,000 tons of carbon black last year, accounting for 10.41 percent of the nation's total amount. Shanxi Yongdong Chemistry Industry Co., Ltd. (002753.SZ) owns advantages in coal tar and the whole carbon black industry chain.
○ China to increase input in environmental protection in 13th Five-Year Plan period, policy support to bring wide market
------
At the international clean technology and financing summit and the first annual meeting of international platform for environment technology held on June 7, Huang Runqian, the vice minister of the Ministry of Environmental Protection said that China will make great achievements in environmental protection during the 13th Five-Year Plan period, and the environmental protection technology and the environmental protection industry will see great opportunities. China will remarkably increase input in environmental protection in the next five years, making environmental protection a new pillar industry and a new growth point.
Comment: As the State Council issued the action plan for soil on May 31, the plans for air, water and soil pollution prevention have all been released. With great support from the government, the increasing input in environmental protection will bring a broader market for relevant companies. Among listed companies, Xi'an Qiyuan Mechanical and Electrical Equipment Co., Ltd. (300140.SZ), a subsidiary of China Energy Conservation and Environmental Protection Group, plans to acquire 100 percent equities of CECEP L＆T Environmental Technology Co., Ltd. to develop desulfurization and denitrification. Cec Environmental Protection Co., Ltd.(300172.SZ) is expanding smoke-gas treatment and sludge disposal while focusing on water treatment.
TOP
[Announcement Interpretation]
○ Kingray to transform into licensed financial holding company with assets injection with RMB18.3 bln
------
Kingray New Materials Science ＆ Technology Co., Ltd. (600390.SH) rporposes to acquire 100 percent equities of Minmetals Capital Holdings Limited by issuing shares at 10.15 yuan per share to China Minmetals and other participants. It will indirectly hold 67.86 percent equities of Minmetals International Trust Co., Ltd., 99.76 percent equities of Minmetals Securities Co., Ltd. and 99 percent equities of Minmetals ＆ Jingyi Futures Co., Ltd. The overall price of the assets to be acquired is 18,336 million yuan and the acquisition P/E ratio is 9 times based on the profit in 2015. Meanwhile, it proposes to raise a supporting fund of 15 billion yuan by issuing shares at the same price through private placement. The proceeds will be invested in Minmetals International Trust, Minmetals Securities and Minmetals ＆ Jingyi Futures as well as supplementing the working capital.
Kingray will obtain quality financial assets on the basis of the previous new energy battery business if the transaction can be smoothly implemented. It will become a comprehensive financial holding platform with license for trust, financial leasing, securities, futures, funds and commercial banks.
○ Reorganization of Tangel Publishing and HNA Infrastructure approved
------
The reorganizations of Tangel Publishing Co., Ltd. (300148.SZ) and Hainan HNA Infrastructure Investment Group Co., Ltd. (600515.SH) for assets purchase by issuing shares were conditionally approved by the China Securities Regulatory Commission (CSRC). The reorganization of Baofeng Group Co., Ltd. (300431.SZ) was vetoed.
TOP
○ Changyuan Group to acquire intelligent factory with RMB1.88 bln to equip company
------
Changyuan Group Ltd. (600525.SH) plans to acquire 80 percent equities of Shanghai Yin Science ＆ Technology Co., Ltd. with 1.88 billion yuan in cash. The latter is a provider of digital equipment solutions for the whole apparel technology product line and cutting plans for soft materials. It is one of the few enterprises with proprietary intellectual property rights on CNC cutting machines
Yin Science ＆ Technology recorded a net profit of 112 million yuan in 2015. The counterparty committed that the net profit after extraordinary items will be no less than 150 million yuan and 200 million yuan in 2016 and 2017. Yin Science ＆ Technology and Changyuan Group will bring synergy to a subsidiary in the "intelligent factory" sector.
○ Jinhong Energy Investment's actual controller introduces shareholding increase plan
------
Chen Yihe, the actual controller of PetroChina Jinhong Energy Investment Co., Ltd. (000669.SZ), increased the shareholding in the company with 9.21 million shares through bulk trading on June 7 at average purchase price is 15.83 yuan per share, accounting for 1.9 percent of its total share capitals. Chen will further increase the shareholding in the company in the following 12 months.
○ Jin Tong Ling to raise RMB500 mln to expand main business
------
Jiangsu Jin Tong Ling Fluid Machinery Technology Co., Ltd. (300091.SZ) intends to raise 500 million yuan by issuing 50 million shares through private placement. The proceeds will be invested in the new efficient turbine and ancillary power generation equipment, the research and development of small gas turbine and supplementing working capital. The benchmark pricing day is the first issuance day. Ji Wei and Ji Weidong, actual controllers of the company, will establish a plan to fully subscribe the shares issued through the private placement.
[Data Speaks]
○ Several listed companies see fewer shareholders in nearly two months
------
Based on SSN's statistics, more than 170 listed companies released the latest data of their shareholders as of June 6. The number of shareholders of several listed companies declined drastically during March 31 and May 31. Quantum Hi-Tech (China) Biological Co., Ltd. (300149.SZ), Yinyi Real Estate Co., Ltd., Shenzhou Yiqiao Information Service Co., Ltd. (000606.SZ) and Wedge Industrial Co., Ltd. (000534.SZ) saw the biggest decline in the number of shareholders with a decrease of 35.17 percent, 33.21 percent, 29.85 percent and 28.4 percent, respectively. Compared with data in the first quarter, the number of shareholders of 14 listed firms involved in this survey fell by more than 10 percent and eight listed firms dropped by more than 20 percent. These companies are mainly engaged in bio-pharmaceutical, machinery equipment, chemical and other industries.
[Trading Trends]
○ A Three institutional seats buy Hengyun Enterprises
------
The trading volume ranking list on June 7 shows that three institutional seats bought Guangzhou Hengyun Enterprises Holding Ltd. (000531.SZ) with a total of 44.78 million yaun, accounting for 11.7 percent of its intraday turnover.
Comment: Hengyun Enterprises is engaged in power businesses. The company recently announced it would participate in the establishment of a credit guarantee and insurance company. The investment will expand the financial industrial chain of the company and bring additional profits. In addition, a company under the State-owned Assets Supervision and Administration Commission of Guangzhou Municiple Government increased the shareholding in the company previously.
[Trading Alarms]
○ Xinguang Phar. starts subscription on June 8
------
Zhejiang Xinguang Pharmaceutical Co., Ltd. (300519.SZ) issues shares at 12.2 yuan per share with a P/E ratio of 8 times and an upper subscription limit of 20,000 shares for each account. The company is mainly engaged in the production of Chinese patent medicine.
[Publication Suspension]
○ Based on the holiday arrangement on the Shanghai and Shenzhen stock exchanges, this product will suspend publication on June 8 and 9 and will resume normal on June 12. Wish investors a happy holiday!
TOP
○ Two giants to set up Internet-based insurance firm, UBI market to reach RMB30 bln
○ Carbon black prices rise as high as 20 pct., China to increase input in environmental protection in 13th Five-Year Plan period
○ Kingray to transform into licensed financial holding company, reorganization of Tangel Publishing and HNA Infrastructure approved
○ Changyuan Group to acquire intelligent factory to equip company, Jinhong Energy Investment sees shareholding increase plan
[SSN Focus]
○ Two giants to set up Internet-based insurance firm, UBI market to reach RMB30 bln
------
CPIC Property Insurance Co., Ltd. owned by China Pacific Insurance (Group) Co., Ltd. (CPIC) (601601.SH; 02601.HK) signed a strategic cooperation agreement with Baidu to incorporate a new Internet-based insurance company with a registration capital of 2 billion yuan. CPIC indicated that it will integrate its traditional car insurance business with technology with the help of Baidu's big data, map and artificial intelligence and provide more diversified products for the new generation of consumers.
Comment: Based on the analysis of big data of driving behavior, insurance company can differentiate customers and give cheaper quotations to those with good driving habits to seize the rapid-growing vehicle insurance market with lower costs. According to Industrial Securities' estimate, the usage-based insurance (UBI) market is expected to approach 30 billion yuan by 2020. Among A-share companies, Shenzhen Deren Electronic Co., Ltd. (002055.SZ) acquired Italian company Meta System, which will meet insurance companies' demands for car insurance pricing and restoring accident scene. United Electronics Co., Ltd. (002642.SZ ) acquired Internet of vehicles. Its clients include a large number of insurance enterprises and vehicle enterprises. Guangdong Shenglu Telecommunication Tech. Co., Ltd. (002446.SZ) said in its annual report that it would launch various vehicle-mounted intelligent terminals, including automobile data recorder.
[SSN Selection]
○ The communication department of the Ministry of Industry and Information Technology said on June 7 that it will issue the 13th Five-Year Plan for the communication industry. It will accelerate construction of optical network in urban areas and continued to improve 4G network coverage.
○ China's central bank conducted one-month medium-term lending facility (MLF) operations for the first time in 4 months. The injection of long-term capital will help stabilize the market expectations for liquidity.
○ Paulson Institute and other research institutes said in a report released on June 7 that the demands for investment for low-carbon city construction in China is expected to reach 1 trillion U.S. dollars in next 5 years.
○ Chief engineer of China Railway Corporation indicated that there is no technical and safety problems to restore the speed of high-speed rail to 350km/h, but it still should be justified whether to restore the speed.
○ The proportion of investors participating in trading in the A-share market surged to 12.38 percent last week from 12.53 percent a week earlier. The net amount of securities margin transferred was 19.5 billion yuan.
○The price of lithium carbonate declined 9 percent since mid-April. It is learnt that lithium carbonate projects in Sichuan and Qinghai still have difficulties to expand productivity.
TOP
[Industry Information]
○Carbon black prices hike as high as 20 pct.
------
SSN learns that driven by low inventory and rising costs, carbon black prices have hiked from 500 to 1000 yuan per ton, the second hike in the year. The highest increase reaches 20 percent. Owed to excessive productivity, the carbon black market has been sluggish in recent years. Its prices have declined nearly 30 percent since the end of 2013. Some productivity has begun to exit the market. The supply and demand situation in the industry begins to improve.
Comment: The carbon black productivity in China approaches to 7 million tons, accounting for about 42 percent of the world's total productivity, making China the largest carbon black producer in the world. Institutes estimate that the demands for carbon black from downstream tyre and industrial rubber products will grow at an annual rate of nearly 6 percent. The industry's profitability is expected to improve. As for companies, Longxing Chemical Stock Co., Ltd. (002442.SZ) produced 405,000 tons of carbon black last year, accounting for 10.41 percent of the nation's total amount. Shanxi Yongdong Chemistry Industry Co., Ltd. (002753.SZ) owns advantages in coal tar and the whole carbon black industry chain.
○ China to increase input in environmental protection in 13th Five-Year Plan period, policy support to bring wide market
------
At the international clean technology and financing summit and the first annual meeting of international platform for environment technology held on June 7, Huang Runqian, the vice minister of the Ministry of Environmental Protection said that China will make great achievements in environmental protection during the 13th Five-Year Plan period, and the environmental protection technology and the environmental protection industry will see great opportunities. China will remarkably increase input in environmental protection in the next five years, making environmental protection a new pillar industry and a new growth point.
Comment: As the State Council issued the action plan for soil on May 31, the plans for air, water and soil pollution prevention have all been released. With great support from the government, the increasing input in environmental protection will bring a broader market for relevant companies. Among listed companies, Xi'an Qiyuan Mechanical and Electrical Equipment Co., Ltd. (300140.SZ), a subsidiary of China Energy Conservation and Environmental Protection Group, plans to acquire 100 percent equities of CECEP L＆T Environmental Technology Co., Ltd. to develop desulfurization and denitrification. Cec Environmental Protection Co., Ltd.(300172.SZ) is expanding smoke-gas treatment and sludge disposal while focusing on water treatment.
TOP
[Announcement Interpretation]
○ Kingray to transform into licensed financial holding company with assets injection with RMB18.3 bln
------
Kingray New Materials Science ＆ Technology Co., Ltd. (600390.SH) rporposes to acquire 100 percent equities of Minmetals Capital Holdings Limited by issuing shares at 10.15 yuan per share to China Minmetals and other participants. It will indirectly hold 67.86 percent equities of Minmetals International Trust Co., Ltd., 99.76 percent equities of Minmetals Securities Co., Ltd. and 99 percent equities of Minmetals ＆ Jingyi Futures Co., Ltd. The overall price of the assets to be acquired is 18,336 million yuan and the acquisition P/E ratio is 9 times based on the profit in 2015. Meanwhile, it proposes to raise a supporting fund of 15 billion yuan by issuing shares at the same price through private placement. The proceeds will be invested in Minmetals International Trust, Minmetals Securities and Minmetals ＆ Jingyi Futures as well as supplementing the working capital.
Kingray will obtain quality financial assets on the basis of the previous new energy battery business if the transaction can be smoothly implemented. It will become a comprehensive financial holding platform with license for trust, financial leasing, securities, futures, funds and commercial banks.
○ Reorganization of Tangel Publishing and HNA Infrastructure approved
------
The reorganizations of Tangel Publishing Co., Ltd. (300148.SZ) and Hainan HNA Infrastructure Investment Group Co., Ltd. (600515.SH) for assets purchase by issuing shares were conditionally approved by the China Securities Regulatory Commission (CSRC). The reorganization of Baofeng Group Co., Ltd. (300431.SZ) was vetoed.
TOP
○ Changyuan Group to acquire intelligent factory with RMB1.88 bln to equip company
------
Changyuan Group Ltd. (600525.SH) plans to acquire 80 percent equities of Shanghai Yin Science ＆ Technology Co., Ltd. with 1.88 billion yuan in cash. The latter is a provider of digital equipment solutions for the whole apparel technology product line and cutting plans for soft materials. It is one of the few enterprises with proprietary intellectual property rights on CNC cutting machines
Yin Science ＆ Technology recorded a net profit of 112 million yuan in 2015. The counterparty committed that the net profit after extraordinary items will be no less than 150 million yuan and 200 million yuan in 2016 and 2017. Yin Science ＆ Technology and Changyuan Group will bring synergy to a subsidiary in the "intelligent factory" sector.
○ Jinhong Energy Investment's actual controller introduces shareholding increase plan
------
Chen Yihe, the actual controller of PetroChina Jinhong Energy Investment Co., Ltd. (000669.SZ), increased the shareholding in the company with 9.21 million shares through bulk trading on June 7 at average purchase price is 15.83 yuan per share, accounting for 1.9 percent of its total share capitals. Chen will further increase the shareholding in the company in the following 12 months.
○ Jin Tong Ling to raise RMB500 mln to expand main business
------
Jiangsu Jin Tong Ling Fluid Machinery Technology Co., Ltd. (300091.SZ) intends to raise 500 million yuan by issuing 50 million shares through private placement. The proceeds will be invested in the new efficient turbine and ancillary power generation equipment, the research and development of small gas turbine and supplementing working capital. The benchmark pricing day is the first issuance day. Ji Wei and Ji Weidong, actual controllers of the company, will establish a plan to fully subscribe the shares issued through the private placement.
[Data Speaks]
○ Several listed companies see fewer shareholders in nearly two months
------
Based on SSN's statistics, more than 170 listed companies released the latest data of their shareholders as of June 6. The number of shareholders of several listed companies declined drastically during March 31 and May 31. Quantum Hi-Tech (China) Biological Co., Ltd. (300149.SZ), Yinyi Real Estate Co., Ltd., Shenzhou Yiqiao Information Service Co., Ltd. (000606.SZ) and Wedge Industrial Co., Ltd. (000534.SZ) saw the biggest decline in the number of shareholders with a decrease of 35.17 percent, 33.21 percent, 29.85 percent and 28.4 percent, respectively. Compared with data in the first quarter, the number of shareholders of 14 listed firms involved in this survey fell by more than 10 percent and eight listed firms dropped by more than 20 percent. These companies are mainly engaged in bio-pharmaceutical, machinery equipment, chemical and other industries.
[Trading Trends]
○ A Three institutional seats buy Hengyun Enterprises
------
The trading volume ranking list on June 7 shows that three institutional seats bought Guangzhou Hengyun Enterprises Holding Ltd. (000531.SZ) with a total of 44.78 million yaun, accounting for 11.7 percent of its intraday turnover.
Comment: Hengyun Enterprises is engaged in power businesses. The company recently announced it would participate in the establishment of a credit guarantee and insurance company. The investment will expand the financial industrial chain of the company and bring additional profits. In addition, a company under the State-owned Assets Supervision and Administration Commission of Guangzhou Municiple Government increased the shareholding in the company previously.
[Trading Alarms]
○ Xinguang Phar. starts subscription on June 8
------
Zhejiang Xinguang Pharmaceutical Co., Ltd. (300519.SZ) issues shares at 12.2 yuan per share with a P/E ratio of 8 times and an upper subscription limit of 20,000 shares for each account. The company is mainly engaged in the production of Chinese patent medicine.
[Publication Suspension]
○ Based on the holiday arrangement on the Shanghai and Shenzhen stock exchanges, this product will suspend publication on June 8 and 9 and will resume normal on June 12. Wish investors a happy holiday!
TOP
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