[Today's Guide]
○ China and U.S. to conduct dialogue on cyber security, industry to catch more attention
○ Orders for aviation equipment signed, industry to see high growth
○ Jinjia Group to expand Internet of things, Tibet Galaxy Science ＆ Technology Development bought by Ma Shufen to 5 percent threshold
○ Billions Chemicals' titanium dioxide sees continuous price hike, Nanning Sugar Industry bought by five institutional seats
[SSN Focus]
○ China and U.S. to conduct dialogue on cyber security, industry to catch more attention
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Xinhua News Agency reported that the second Sino-U.S. high-level dialogue on cracking cyber crimes and relevant matters will be held in Beijing on June 14. The dialogue will cover desktop maneuvers on cyber security, hotline mechanism, cyber security protection, law enforcement information exchange and ability improvement as well as the investigation in cyber cases. Experts point out that it is an important progressive dialogue in the Sino-U.S. Internet cooperation. It will further implement the consensus reached by the two heads of the two countries, further improve the cooperation framework, effectively respond to each other's concerns and constructively regulate and control differences to solve more actual problems in cyber security.
Comment: Institutes believe that with the acceleration in IT application, China is attaching increasing high importance to the cyber security industry. The cyber security has been lifted as a national strategy and enjoys a market potential of 100 billion yuan. Among A-share listed companies, Starrysky, a subsidiary of Fiberhome Telecommunication Technologies Co., Ltd. (600498.SH), is a domestic leader in online supervision and enjoys the biggest market share for the Ministry of Public Security. Xiamen Meiya Pico Information Co., Ltd. (300188.SZ) is a leader in computer forensics. Its online supervision products are applied in the public security system at the municipal level.
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[SSN Selection]
○ The Ministry of Foreign Affairs announced that President Xi Jinping will visit Serbia and other two countries from June 17 and will attend the SCO Summit to be held in Uzbekistan.
○ The National Bureau of Statistics indicated that the raw coal output decreased 15.5 percent year on year in May, showing the effects of the de-capacity.
○ Baichuan data show that the quoted price of antimony oxides hiked over 5 percent on June 13. The Chinese Antimony Annual conference to be held on June 15 will set the direction of the environmental treatment for the industry.
○ The State Grid Zhejiang Electric Power Company indicated that the province is expected to achieve the full coverage of quick charging stations for electric vehicles in all services areas along the express ways by the end of the year.
○ Microsoft has announced that it will acquire LinkedIn, a professional social website, for 26.2 billion U.S. dollars. The stock price of LinkedIn surged 46 percent in the pre-marketing trading session.
[Industry Information]
○ Orders for aviation equipment signed, industry to see high growth
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The Joint Statement on the Fourth Sino-German Government Consultations was released on June 13. The two sides have reached various cooperation in the political, economic and trade, environmental, education and other sectors, proposing to further advance the partnership in the Tianjin Airbus A320 general assembly line between Airbus and the Aviation Industry Corporation of China (AVIC). On the same day, Eurocopter and the Chinese side signed a framework agreement to establish the general assembly line for the H135 helicopter. AVIC HAIG and AVIC General Aviation under the AVIC signed a contract on the same day. Each of them will contribute 200 million yuan in the establishment of Harbin General Aviation to produce airplanes with fixed wings.
Comment: Considering that China Aero-engine Group Co., Ltd. was recently established, the C919 may make its maiden flight in the second half. The manufacturing of aviation equipment will see huge growth. Haitong Securities Company Limited (06837.HK; 600837.SH) believes that Chinese military airplanes require improvement in quality and quantity while the commercial aviation demands still increase. The general aviation enjoys huge potential. The airplane equipment manufacturing industry will see a golden decade. The replacement of the imported system and aero-engines is expected.
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○ Guidance on health and medical big data to release soon
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SSN learnt from relevant departments under the National Health and Family Planning Commission (NHFPC) that the NHFPC will release the Guidance on the Facilitating and Regulating the Application and Development of Health and Medical Big Data soon. It is reported that the guidance has been approved by the executive meeting of the State Council. The main contents include: the establishment a population health information platform at the state, provincial, municipal and county levels; integrate the medical big data resources to establish clinical decision-making, diseases diagnosis, research and development of medicines and other supporting systems and develop distant medical treatment and intelligent health and medical equipment and establish health archives and other fundamental database.
[Announcement Interpretation]
○ Jinjia Group to expand Internet of things, with strong support from Fosun Group
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Shenzhen Jinjia Group Co., Ltd. (002191.SZ) proposes to raise 1.65 billion yuan through private placement by issuing 181 million shares at 9.14 yuan per share. The fundraising will be used for intelligent Internet of things operating and supporting system based on RFID technology, Guizhou food safety (including medicines and health products) Internet of things and big data sales tracking platform, new materials packing and intellectualized upgrading projects. According to the plan, Fuxing Antai, a member of Fosun Group, proposes to spend 1.2 billion yuan for subscription. Jinjia Investment, controlling shareholder of the company, plans to participate in the subscription with 0.2 billion yuan.
○ Tibet Galaxy Science ＆ Technology Development bought by Ma Shufen to 5 percent threshold
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Ma Shufen, natural person shareholder of Tibet Galaxy Science ＆ Technology Development Co., Ltd. (000752.SZ) on June 6 held 13,189,900 shares of the company, representing more than 5 percent of the total share capital of the company.
It is worth noting that the controlling right of Tibet Galaxy Science ＆ Technology Development is currently under transferring. The original controlling shareholder Guangda Jinlian proposes to transfer 28,099,600 shares (10.65 percent of the total share capital) held by it to Tianyi Xiangxing, which is likely to become the new biggest shareholder. It is also probable that the latter will continue to increase holding in the coming year.
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○ Billions Chemicals' main product titanium dioxide sees price hike
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Henan Billions Chemicals Co., Ltd. (002601.SZ) announced that it will again increase the selling price of its main product rutile titanium dioxide from June 13. Specifically, rutile type titanium dioxide produced by sulfuric acid method will be increased by 500 yuan per ton overall in domestic market, and increased by 100 U.S. dollars per ton for overseas market; rutile type titanium dioxide produced by chlorination process will be increased by 1,000 yuan per ton overall in domestic market, and increased by 150 U.S. dollars per ton for overseas market.
Rutile titanium dioxide accounts for 86.57 percent of the company's sales in 2015. From the beginning of the year, the average selling price of the product has hiked by about 25 percent in total.
○ Sunyard System Engineering to acquire Jinwang Antai, to build supply chain financial IT cloud
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Sunyard System Engineering Co., Ltd. proposes to acquire 80 percent equities of Jinwang Antai at the valuation of 960 million yuan, which will be satisfied by fundraising from private placement at 41.06 yuan per share and cash payment of 144 million yuan; at the same time, the company proposes to raise supporting fund of 960 million yuan through private placement at 36.95 yuan per share.
Jinwang Antai has been engaged in the provision of information technology solutions such as relevant software products, system development and technology support for large domestic group companies and various commodities exchange markets. According to the performance commitment, the net profits of Jinwang Antai deducted of non-recurring profits or losses for 2016 to 2018 will be 80 million yuan, 104 million yuan and 135 million yuan respectively.
○ Zoomlion Heavy Industry Science and Technology proposes to repurchase shares with 1 billion yuan
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Zoomlion Heavy Industry Science and Technology Co., Ltd. (000157.SZ) proposes to repurchase its A shares at no more than 5.21 yuan per share (namely the net asset value per share of the company as of the end of 2015) and cancel relevant shares. The total amount will be no more than 1 billion yuan, representing at least 192 million shares, or 2.5 percent of the total share capital of the company.
The latest price of the company is 4.01 yuan per share. The repurchase price represents a premium of about 30 percent. The implementation period of the repurchase will be the next 12 months from the general meeting of the shareholders.
○ Xcmg Construction Machinery to build factory in India with 250 mln U.S. dollars
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Xcmg Construction Machinery Co., ltd. (000425.SZ) proposes to invest 250 million U.S. dollars to build an engineering machinery manufacturing base in Chennai, India. This investment is in line with China's "Belt and Road" national strategy. The company aims to realize international development strategy by gaining a foothold in India and making presence in the construction machinery markets in surrounding areas such as South Asia, Southeast Asia, the Middle East and East Africa.
[Trading Trends]
○ Nanning Sugar Industry bought by five institutional seats
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The trading volume ranking list on June 13 shows that Nanning Sugar Industry Co., Ltd. (000911.SZ) was bought by five institutional seats with a total of 79,470,000 yuan, accounting for 19 percent of intraday turnover; another institution sold 22,440,000 yuan.
Comment: the company announced on June 7 that it will raising 1 billion yuan from two wholly owned subsidiaries of Guangxi State-owned Assets Supervision and Administration Commission (SASAC) thorough private placement at 16.6 yuan per share. The proceeds will be used to repay bank loans and supplement working capital. Institutions believe that enhanced support from state-owned enterprises will facilitate the company's industrial integration. In addition, international raw sugar sees continuous recovery of price. Import beyond the quota has recorded deficit. The approaching of the peak consumption season will drive the price of domestic sugar to surge.
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