[Today's Guide]
○Under-construction urban rail transit projects see rapid growth, industry investment largely increases
○Piloting scheme for agricultural reclamation reform printed and distributed, Industry events to intensively launch, charging pile industry to constantly boosted
○Gaofa Automotive Control System launches private placement to deploy automotive electronics field, Xinghua Chemistry carries out restructuring
○Corun New Energy to invest in new energy vehicle industry, Protruly Vision Technology Group to invest in new energy vehicle industry
[SSN Focus]
○Under-construction urban rail transit projects see rapid growth, industry investment largely increases
------
The "Rail Metro China 2016" was opened in Shanghai on June 14. As introduced by the sponsor, 4,448km of urban rail transit are now under construction in China. 386.3 billion yuan was invested in urban rail transit across the country last year, representing a year-on-year growth of 27 percent. Urban rail transit is now playing a great driving role in China's new round of infrastructure construction.
Comment: According to data disclosed by the National Development and Reform Commission (NDRC), only 3,300km urban rail transit were under construction in China and an investment of 350 billion yuan was planned in 2015. The fast-growing number of under-construction projects and the over-fulfilled investment target all suggest that the construction of urban rail transit is growing rapidly. As the approval threshold for construction lowers in the future, more third-tier and fourth-tier cities might join the "club" of rail transit. Nanjing Kangni Mechanical ＆ Electrical Co., Ltd. (603111.SH) takes up a big market share of the door for domestic urban subway. Shanghai Tunnel Engineering Co., Ltd. (600820.SH) takes a leading role in tunnel construction and is favored by institutional research reports.
[SSN Selection]
○The State Council on June 14 issued circular proposing to establish an examination system for fair competition amid the construction of market system and requiring breaking down regional blockades and industrial monopolies.
○Main activities of the national food safety publicity week were held on June 14. Vice-premier Wang Yang stressed that the improvement of a unified and authoritative food safety supervision mechanism should be accelerated.
○The securities margin saw a net outflow of 41.3 billion yuan last week, representing a net outflow for the fourth consecutive week.
○The yield rate of Germany's 10-year Treasury bonds dropped below zero for the first time since many investors flow to safe-haven assets.
○China Vanke Co., Ltd. (000002.SZ; 02202.HK) announced smooth progress of reorganization and will continue to suspend trading. It is estimated by Caixin that Vanke might resume trading at end June or early July.
TOP
[Industry Information]
○Piloting scheme for agricultural reclamation reform printed and distributed, development of relevant listed companies to beat expectation
------
The Ministry of Agriculture (MOA) on June 14 said on its website that it decided to launch special projects on deepening agricultural reclamation reform in reclamation areas around the nation. It is proposed to establish state-owned capital investment and operation companies through reorganization, restructuring and direct authorization by governments so as to build a platform for market-oriented operation of capital. The piloting scheme will define specific tasks and help to advance the agricultural reclamation reform.
Comment: Research reports by securities companies believe that boosted by a string of policies released by central and local governments, the development of listed companies engaged in agricultural reclamation might beat expectation. Heilongjiang Agriculture Company Limited (600598.SH) owns a land resource of 13 million mu. Institutions are optimistic about that the mixed-ownership reform, agricultural reclamation reform and food security will facilitate companies' value return; the substantial shareholder of China Hainan Rubber Industry Group Co., Ltd. (601118.SH), the largest natural rubber producer in China, is Hainan Agricultural Reclamation Group.
○Industry events to intensively launch, charging pile industry to constantly boosted
------
The 2016 China New Energy Vehicles Charging Facilities Construction and Development Summit will be held in Shanghai on June 16. The meeting will focus on the development and prospect of China's electro-mobiles industry, the application of communication gateway technologies in charging stations and etc. In addition, China's first Charging Piles Innovation Summit, themed with "charging piles and sharing", will be held in Beijing on July 27. And the meeting will carry out in-depth discussion centering on the construction, application, commercial secondary development, core-data-based big data sharing and etc.
Comment: Institutions expect that the demand for charging piles might reach 5 million by 2020 across the country, while only 50,000 have been constructed at the end of 2015, suggesting huge market potential. Along with the intensive launch of schemes by various places for the construction of charging facilities and the progress of the invitation for bids by the State Grid Corporation of China, China Southern Power Grid and various governments, the charging pile industry will be driven by plenty of events. In addition, the bidding for the third batch of charging piles will be started in the second part of September and the size might be obviously expanded.
TOP
[Announcement Interpretation]
○Gaofa Automotive Control System to raise RMB880 mln through private placement to deploy automotive electronics field
------
Ningbo Gaofa Automotive Control System Co., Ltd. (603788.SH) plans to raise 880 million yuan by issuing 27.63 million shares through private placement at a price of no less than 31.99 yuan per share. The fundraising will be used to purchase 80 percent equity of Ningbo Xueliman Electronic Meter Co., Ltd. and 35.55 percent equity of Ningbo Yinzhou Xueliman Software Co., Ltd., invest in the project of automotive electronic gear shifting system, project expanding production capacity of automotive CAN control system, new project of automotive virtual instrument and new construction project of urban bus networking platform, and supplement working capitals.
Gaofa Automotive Control System is mainly engaged in manufacturing and selling automotive control system. The company extend its business to automotive electronic gear shifting system field through this private placement project.
○Xinghua Chemistry to buy Shaanxi Yanchang Petroleum Xinghua Chemical
------
Due to the remarkable drop in LNG price, Shaanxi Xinghua Chemistry Co., Ltd. (002109.SZ) adjusted its restructuring plan. It will not purchase Shaanxi Yanchang Petroleum ＆ Natural Gas Co., Ltd. Instead, it intends to acquire 100 percent equity of Shaanxi Yanchang Petroleum Xinghua Chemical Co., Ltd. by equivalent replacement with all its assets and liabilities except currency capital, available-for-sale financial assets, trademark, bills payable and tax payable, and the remaining will be purchased by issuing shares at a price of 5.96 yuan per share. The value of Shaanxi Yanchang Petroleum Xinghua Chemical is estimated to be nearly 3 billion yuan and the company is able to annually produce 300,000 tons of synthesis ammonia, 300,000 tons of methyl alcohol and 100,000 tons of methylamine and DMF.
TOP
○Corun New Energy to raise RMB1.5 bln to improve new energy vehicle industrial chain
------
Hunan Corun New Energy Co., Ltd. (600478.SH) is going to raise 1.5 billion yuan through private placement at a floor price of 9.54 yuan per share to invest in industrialization of power battery, industrial park of nickel foam for new energy vehicle and research and development project of CHS hybrid powertrain system. This private placement is conducive to enrich the company's product portfolio and strengthen the company's leading role in hybrid powertrain system and core components industry.
○Protruly Vision Technology Group to invest RMB640 mln in new energy vehicle
------
Jiangsu Protruly Vision Technology Group Co., Ltd. (600074.SH) intends to increase investment value 640 million yuan in Liuzhou Yanlong Automobile Co., Ltd., which will allow the company to hold 46 percent equity in the latter. The company plans to embark in new energy vehicle field rapidly by this investment, aiming to realize the intelligentized automotive industry development. Yanlong Automobile is specialized in manufacturing new energy vehicle, refitting and manufacturing special purpose vehicle and operation of automotive aftermarket, and it is qualified for producing new energy vehicle and special purpose vehicle.
The company also announced on the same day that it would invest 138 million yuan in establishing Zhongkang Life Insurance Co., Ltd. The investment accounts for 13.8 percent of the total investment.
○Camel Group to invest RMB1 bln to build automotive storage battery project in Chongqing
------
Camel Group Co., Ltd. (601311.SH) plans to invest and build a project with annual production of 4 million KWAH high-performance sealed battery for automobile and recycling and utilizing 150,000 tons of storage battery per year in Qijiang industrial park in Chongqing Municipality. It is predicted to invest 1 billion yuan in this project. After reaching designed capacity, the project can achieve production value worth 3 billion yuan and pay tax revenue 200 million yuan.
○Price of principal product of CNNC Hua Yuan Titanium Dioxide to hike again
------
Average sales price of rutile titanium dioxide, the principal product of CNNC Hua Yuan Titanium Dioxide Co., Ltd. (002145.SZ), will be raised again by 500 yuan per ton from June 15. The income of this product accounts for 92 percent of the company's sales revenue in 2015. Its price has totally hiked by as high as 25 percent since the beginning of this year. Previously, Henan Billions Chemicals Co., Ltd. (002601.SZ) announced that it would raise price of its leading product rutile titanium dioxide again from June 13.
[Trading Trends]
○Cisri-gaona Materials ＆ Technology bought through 3 institutional seats
------
The trading volume ranking list on June 14 shows that Beijing Cisri-gaona Materials ＆ Technology Co., Ltd. (300034.SZ) was bought through three institutional seats with a total of 102 million yuan, accounting for 22.44 percent of its intraday turnover, and was sold through one institutional seat with a total of 32.96 million yuan.
Comment: The company is a leader in high temperature alloy industry in China, ranking ahead in terms of research and development strength and production scale. Institutions believe that amid the course of rapid development of military industry modernization, with the booming downstream demand for new material of aerospace represented by high temperature alloy, great support from policy and higher technological barriers, there exists stronger certainty in growth of the company's performance for the long term.
[Trading Alarms]
○Shengxunda Technology to launch IPO on June 15
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Shenzhen Shengxunda Technology Co., Ltd. (300518.SZ) is going to launch IPO at a price of 22.22 yuan per share with an upper limit of 9,000 shares for each account. The PE ratio is 23 times. The company is principally engaged in mobile games.
TOP
○Under-construction urban rail transit projects see rapid growth, industry investment largely increases
○Piloting scheme for agricultural reclamation reform printed and distributed, Industry events to intensively launch, charging pile industry to constantly boosted
○Gaofa Automotive Control System launches private placement to deploy automotive electronics field, Xinghua Chemistry carries out restructuring
○Corun New Energy to invest in new energy vehicle industry, Protruly Vision Technology Group to invest in new energy vehicle industry
[SSN Focus]
○Under-construction urban rail transit projects see rapid growth, industry investment largely increases
------
The "Rail Metro China 2016" was opened in Shanghai on June 14. As introduced by the sponsor, 4,448km of urban rail transit are now under construction in China. 386.3 billion yuan was invested in urban rail transit across the country last year, representing a year-on-year growth of 27 percent. Urban rail transit is now playing a great driving role in China's new round of infrastructure construction.
Comment: According to data disclosed by the National Development and Reform Commission (NDRC), only 3,300km urban rail transit were under construction in China and an investment of 350 billion yuan was planned in 2015. The fast-growing number of under-construction projects and the over-fulfilled investment target all suggest that the construction of urban rail transit is growing rapidly. As the approval threshold for construction lowers in the future, more third-tier and fourth-tier cities might join the "club" of rail transit. Nanjing Kangni Mechanical ＆ Electrical Co., Ltd. (603111.SH) takes up a big market share of the door for domestic urban subway. Shanghai Tunnel Engineering Co., Ltd. (600820.SH) takes a leading role in tunnel construction and is favored by institutional research reports.
[SSN Selection]
○The State Council on June 14 issued circular proposing to establish an examination system for fair competition amid the construction of market system and requiring breaking down regional blockades and industrial monopolies.
○Main activities of the national food safety publicity week were held on June 14. Vice-premier Wang Yang stressed that the improvement of a unified and authoritative food safety supervision mechanism should be accelerated.
○The securities margin saw a net outflow of 41.3 billion yuan last week, representing a net outflow for the fourth consecutive week.
○The yield rate of Germany's 10-year Treasury bonds dropped below zero for the first time since many investors flow to safe-haven assets.
○China Vanke Co., Ltd. (000002.SZ; 02202.HK) announced smooth progress of reorganization and will continue to suspend trading. It is estimated by Caixin that Vanke might resume trading at end June or early July.
TOP
[Industry Information]
○Piloting scheme for agricultural reclamation reform printed and distributed, development of relevant listed companies to beat expectation
------
The Ministry of Agriculture (MOA) on June 14 said on its website that it decided to launch special projects on deepening agricultural reclamation reform in reclamation areas around the nation. It is proposed to establish state-owned capital investment and operation companies through reorganization, restructuring and direct authorization by governments so as to build a platform for market-oriented operation of capital. The piloting scheme will define specific tasks and help to advance the agricultural reclamation reform.
Comment: Research reports by securities companies believe that boosted by a string of policies released by central and local governments, the development of listed companies engaged in agricultural reclamation might beat expectation. Heilongjiang Agriculture Company Limited (600598.SH) owns a land resource of 13 million mu. Institutions are optimistic about that the mixed-ownership reform, agricultural reclamation reform and food security will facilitate companies' value return; the substantial shareholder of China Hainan Rubber Industry Group Co., Ltd. (601118.SH), the largest natural rubber producer in China, is Hainan Agricultural Reclamation Group.
○Industry events to intensively launch, charging pile industry to constantly boosted
------
The 2016 China New Energy Vehicles Charging Facilities Construction and Development Summit will be held in Shanghai on June 16. The meeting will focus on the development and prospect of China's electro-mobiles industry, the application of communication gateway technologies in charging stations and etc. In addition, China's first Charging Piles Innovation Summit, themed with "charging piles and sharing", will be held in Beijing on July 27. And the meeting will carry out in-depth discussion centering on the construction, application, commercial secondary development, core-data-based big data sharing and etc.
Comment: Institutions expect that the demand for charging piles might reach 5 million by 2020 across the country, while only 50,000 have been constructed at the end of 2015, suggesting huge market potential. Along with the intensive launch of schemes by various places for the construction of charging facilities and the progress of the invitation for bids by the State Grid Corporation of China, China Southern Power Grid and various governments, the charging pile industry will be driven by plenty of events. In addition, the bidding for the third batch of charging piles will be started in the second part of September and the size might be obviously expanded.
TOP
[Announcement Interpretation]
○Gaofa Automotive Control System to raise RMB880 mln through private placement to deploy automotive electronics field
------
Ningbo Gaofa Automotive Control System Co., Ltd. (603788.SH) plans to raise 880 million yuan by issuing 27.63 million shares through private placement at a price of no less than 31.99 yuan per share. The fundraising will be used to purchase 80 percent equity of Ningbo Xueliman Electronic Meter Co., Ltd. and 35.55 percent equity of Ningbo Yinzhou Xueliman Software Co., Ltd., invest in the project of automotive electronic gear shifting system, project expanding production capacity of automotive CAN control system, new project of automotive virtual instrument and new construction project of urban bus networking platform, and supplement working capitals.
Gaofa Automotive Control System is mainly engaged in manufacturing and selling automotive control system. The company extend its business to automotive electronic gear shifting system field through this private placement project.
○Xinghua Chemistry to buy Shaanxi Yanchang Petroleum Xinghua Chemical
------
Due to the remarkable drop in LNG price, Shaanxi Xinghua Chemistry Co., Ltd. (002109.SZ) adjusted its restructuring plan. It will not purchase Shaanxi Yanchang Petroleum ＆ Natural Gas Co., Ltd. Instead, it intends to acquire 100 percent equity of Shaanxi Yanchang Petroleum Xinghua Chemical Co., Ltd. by equivalent replacement with all its assets and liabilities except currency capital, available-for-sale financial assets, trademark, bills payable and tax payable, and the remaining will be purchased by issuing shares at a price of 5.96 yuan per share. The value of Shaanxi Yanchang Petroleum Xinghua Chemical is estimated to be nearly 3 billion yuan and the company is able to annually produce 300,000 tons of synthesis ammonia, 300,000 tons of methyl alcohol and 100,000 tons of methylamine and DMF.
TOP
○Corun New Energy to raise RMB1.5 bln to improve new energy vehicle industrial chain
------
Hunan Corun New Energy Co., Ltd. (600478.SH) is going to raise 1.5 billion yuan through private placement at a floor price of 9.54 yuan per share to invest in industrialization of power battery, industrial park of nickel foam for new energy vehicle and research and development project of CHS hybrid powertrain system. This private placement is conducive to enrich the company's product portfolio and strengthen the company's leading role in hybrid powertrain system and core components industry.
○Protruly Vision Technology Group to invest RMB640 mln in new energy vehicle
------
Jiangsu Protruly Vision Technology Group Co., Ltd. (600074.SH) intends to increase investment value 640 million yuan in Liuzhou Yanlong Automobile Co., Ltd., which will allow the company to hold 46 percent equity in the latter. The company plans to embark in new energy vehicle field rapidly by this investment, aiming to realize the intelligentized automotive industry development. Yanlong Automobile is specialized in manufacturing new energy vehicle, refitting and manufacturing special purpose vehicle and operation of automotive aftermarket, and it is qualified for producing new energy vehicle and special purpose vehicle.
The company also announced on the same day that it would invest 138 million yuan in establishing Zhongkang Life Insurance Co., Ltd. The investment accounts for 13.8 percent of the total investment.
○Camel Group to invest RMB1 bln to build automotive storage battery project in Chongqing
------
Camel Group Co., Ltd. (601311.SH) plans to invest and build a project with annual production of 4 million KWAH high-performance sealed battery for automobile and recycling and utilizing 150,000 tons of storage battery per year in Qijiang industrial park in Chongqing Municipality. It is predicted to invest 1 billion yuan in this project. After reaching designed capacity, the project can achieve production value worth 3 billion yuan and pay tax revenue 200 million yuan.
○Price of principal product of CNNC Hua Yuan Titanium Dioxide to hike again
------
Average sales price of rutile titanium dioxide, the principal product of CNNC Hua Yuan Titanium Dioxide Co., Ltd. (002145.SZ), will be raised again by 500 yuan per ton from June 15. The income of this product accounts for 92 percent of the company's sales revenue in 2015. Its price has totally hiked by as high as 25 percent since the beginning of this year. Previously, Henan Billions Chemicals Co., Ltd. (002601.SZ) announced that it would raise price of its leading product rutile titanium dioxide again from June 13.
[Trading Trends]
○Cisri-gaona Materials ＆ Technology bought through 3 institutional seats
------
The trading volume ranking list on June 14 shows that Beijing Cisri-gaona Materials ＆ Technology Co., Ltd. (300034.SZ) was bought through three institutional seats with a total of 102 million yuan, accounting for 22.44 percent of its intraday turnover, and was sold through one institutional seat with a total of 32.96 million yuan.
Comment: The company is a leader in high temperature alloy industry in China, ranking ahead in terms of research and development strength and production scale. Institutions believe that amid the course of rapid development of military industry modernization, with the booming downstream demand for new material of aerospace represented by high temperature alloy, great support from policy and higher technological barriers, there exists stronger certainty in growth of the company's performance for the long term.
[Trading Alarms]
○Shengxunda Technology to launch IPO on June 15
------
Shenzhen Shengxunda Technology Co., Ltd. (300518.SZ) is going to launch IPO at a price of 22.22 yuan per share with an upper limit of 9,000 shares for each account. The PE ratio is 23 times. The company is principally engaged in mobile games.
TOP
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