[Today's Guide]
○ Regulations on backdoor listing become stricter, Haiqi Transportation approved for IPO
○Terahertz radar developed, NASA announces all-electric plan program
○ WKW Automotive to develop new energy, Reorganizations of Gosun Holding and Jincheng Paper approved
○ Sojo Electric to invest in lithium-ion battery separators, Rainbow Fine Chemical proposes high share conversion in interim report
[SSN Focus]
○ CSRC revises measures for restructuring, regulations on backdoor listing become stricter
------
The China Securities Regulatory Commission (CSRC) on June 17 solicited for public opinions on revising the measures for major assets restructuring in listed companies. It specifies stricter requirements on backdoor listing by improving qualification standards, improving supporting regulation and strengthening responsibilities of intermediary organs. Qualification standards for change of controlling rights will expand from shareholding ratio to shareholding ratio, composition of board of directors and management control. It also cancels supporting financing for restructuring listed companies. Except for new controlling shareholders, the lock-in period for other new shareholders will extend from 12 months to 24 months.
Comment: The expanding qualification standards for backdoor listing will greatly restrict tricks and detour in backdoor listing. The cancellation of supporting financing and extension of lock-in period will make high requirement for strength of restructuring companies, and compress short-term profits of backdoor listed companies. The revision has a very clear aim: to standardized disorders about backdoor listing in the market, crack down speculations in shell companies and provide conditions for companies really qualified for backdoor listing.
○ Haiqi Transportation and others obtained IPO approval, shareholders to see equities value rise
------
The China Securities Regulatory Commission (CSRC) on June 17 approved the IPO applications of seven enterprises, including Hainan Haiqi Transportation Group Co., Ltd. and Bank of Jiangsu. The seven enterprises will raise a total of no more than 8.8 billion yuan. The annual report of Haiqi Transportation Group shows that its net profit recorded 69.91 million yuan last year. Hainan Expressway Co., Ltd. (000886.SZ) and Hainan Strait Shipping Co., Ltd. (002320.SZ) hold 25 and 5 percent equities in Haiqi Transportation Group . Bank of Jiangsu garnered net profit of 9.5 billion yuan last year. Black Peony (Group) Co., Ltd. (600510.SH), Jiangsu Hongtu High Technology Co., Ltd. (600122.SH), Jiangsu Wuzhong Industrial Co., Ltd. (600200.SH), Jiangsu High Hope International Group Corporation (600981.SH) and Jiangsu Yueda Investment Co., Ltd. (600805.SH) hold 1.06 percent, 0.96 percent, 0.5 percent, 0.48 percent and 0.48 percent equities in Bank of Jiangsu.
[SSN Selection]
○ When asked about the progress of the preparations for the Shenzhen-Hong Kong Stock Connect, Deng Ge, spokesperson for the China Securities Regulatory Commission (CSRC), on June 17 indicated that the program will launch at proper time within the year.
○ The CSRC specifically announced relevant works about termination of enterprise IPO review for the first time. It highlighted whether enterprises applying for IPO are in trouble during the review.
○ The CSRC preliminarily confirmed that Dandong Xintai Electric Co., Ltd. (300372.SZ) made fraud in IPO and violated laws and regulation in information disclosure. Once it is finalized, the company will delist.
○ China Business Journal reported that draft of the soil contamination prevention law has started. The law will highlight heavy metal pollution.
○ Vanke announced restructuring plans with Shenzhen Metro's capital injection. China Resources said that it is a groundless statement that the State-owned Assets Supervision and Administration Commission agreed it to buy Baoneng.
○ Financial officials from many countries speak support for Britain remaining in the EU. According to data from poll company BMG, respondents supporting for "Remain" rose to 53.3 percent.
TOP
[Industry Information]
○ CETC develops new radar, terahertz becomes highlight
------
The State Administration of Science, Technology and Industry for National Defense said on its website that China Electronics Technology Group Corporation (CETC) has successfully developed the first all solid-stateterahertz imaging radar system prototype. With few transmission loss in dense smoke and dust conditions, terahertz is an idea technology for detecting enemy and imaging in complicated battlefield environment. Terahertz can make stereoimaging for objects behind walls, detect perdu weapons and armed personnel, reveal tanks, artillery and other equipment in dust and smoke.
Comment: Terahertz has been a research highlight both at home and abroad in recent years, as it can be applied in various fields, such as life science, materials science, astronomy, atmospheric and environmental monitoring, communication. Among listed companies, Anhui Sun Create Electronics Co., Ltd. (600990.SH) is a company under CETC. The terahertz body security inspection device model developed by its substantial shareholder CETC No. 38 Research Institute has been on the market.
○ NASA announces all-electric plan program, battery and light-weight material to become key
------
NASA announced its all-electric aircraft program at a forum held by the American Institute of Aeronautics and Astronautics hold on June 17 local time, according to NASA's website. The plan is called X-17 which will has 14 propoller motors and can only contain one pilot. But NASA plans to develop 5 types of larger plans that can carry more passengers and goods. Chief engineer of the program said that if battery's energy density will continue grow as fast as it did in the past decade, the battery technology will allow the aircraft to be commercialized in the next 5 to 10 years.
Comment: Electricity-driven is expanding from the automobile industry from the aerospace industry. Apart from battery technology, light-weight material is another key for electricity-driven aircraft. In July 2015, the pure electric aircraft developed by Airbus made a successful flight over the English Channel. The aircraft is driven by lithium battery and adopts all carbon fibre composite material.
TOP
[Announcement Interpretation]
○ WKW Automotive to acquire equities of Kawei Auto with RMB1 bln to develop new energy vehicles
------
Beijing WKW Automotive Parts Co., Ltd. (002662.SZ) proposes to acquire 35 percent equities of Jiangsu Kawei Automotive Industrial Group with 1.05 billion yuan in cash to speed up the expansion in the new energy vehicle market.
Kawei Auto is an entity engaged in the production of light vehicles, passenger vehicles, special vehicles and components for vehicles. It is also a vehicle industrial platform for vehicle finance and the export of vehicles and the components. It successfully introduced Hummer electric vehicles in China and developed various new energy vehicles. It has obtained the rights for the production, modification and sales of Mercedes-Benz vans in China.
○ Reorganizations of Gosun Holding and Jincheng Paper approved
------
The significant assets reorganizations of Gosun Holding Co., Ltd. (000971.SZ) and Jincheng Paper Co., Ltd. (000820.SZ) were conditionally approved by the China Securities Regulatory Commission (CSRC).
TOP
○ Sojo Electric to invest in lithium-ion battery separators with RMB130 mln
------
Beijing Sojo Electric Co., Ltd. (300444.SZ) plans to increase the investment in Tianjin DG Membrane Tech. Co., Ltd. with 130 million yuan. It will become its biggest shareholder with 31 percent equities in the company. DG Membrane is a private high-tech enterprise professionally engaged in the research and sales of lithium-ion battery separators. It committed that its expected total net profit from 2016 to 2017 will be no less than 120 million yuan and the expected net profit in 2018 and 2019 will be no less than 180 million yuan and 230 million yuan, respectively.
------○ Boxin Investing sees changes in substantial shareholder
Tibet Kangsheng Investment Management Co., Ltd., a shareholder of Guangdong Boxin Investing ＆ Holdings Co., Ltd. (600083.SH), increased the shareholding in the company with 423,000 shares. It totally holds 15.18 percent shares of the company after the increase and becomes its biggest shareholder.
Kangsheng Investment is the securities investment platform under a wholly-owned subsidiary of Greattown Holdings Ltd. (600094.SH). It increased the shareholding in Boxin Investing in April. Kangsheng Investment indicated that it will hold the shares of the listed company for a long term to obtain revenues from equities appreciation.
○ China Merchants Group determines revenue proportion for land development in Qianhai
------
China Merchants Group, the controlling shareholder of China Merchants Shekou Industrial Zone Holdings Co., Ltd. (001979.SZ), and the Authority of Qianhai signed a framework agreement, proposing that a lot with 2.9km2 in the former Qianhai Bay Logistics Park of China Merchants Group will be under the cooperation scope. The two parties will establish a joint venture with the proportion of 50:50. The platform company controlled by China Merchants Shekou will participate in the establishment of the joint venture as a representative of the contribution party.
Comment: The signing of the above agreement means that the development of the huge land in Qianhai and its revenue proportion have been determined. The land is larger than the expected 2.4 km2. The listed company will benefit from the construction of Shekou Free Trade Zone in the future.
○ Rastar to acquire equities of Quwan Network with RMB970 mln to improve games industrial chain
------
Rastar Group (300043.SZ) intends to acquire 67.13 percent equities of Guangzhou Quwan Network Technology Co., Ltd. with 970 million yuan by issuing shares through private placement and in cash. Meanwhile, it will raise 970 million yuan. The issuing price of the shares issued for purchasing assets is 14.51 yuan per share. Based on the performance commitment, the net profit of Quwan Network will reach 10 million yuan in 2016. The total net profit will be 130 million yuan, 280 million and 480 million yuan in 2017, 2018 and 2019.
Comment: Quwan Network is a mobile entertainment community supplier. It will provide community management services for games users and games groups through the IT social entertainment platform. It will focus on medium and high games users and implement the pan-games strategy.
[Financial Reports Express]
○ Rainbow Fine Chemical proposes high share conversion in interim report
------
The actual controller of Shenzhen Rainbow Fine Chemical Industry Co., Ltd. (002256.SZ) proposes a 30-for-10 conversion of capital surplus into shares according to its interim report. The actual controller of Shenzhen H＆T Intelligent Control Co., Ltd. (002402.SZ) proposes a 13-for-10 conversion of capital surplus into shares combined with 2 shares and 0.2 yuan dividend for every 10 shares according to its interim report.
[Trading Alarms]
○ Honghui New Materials for subscription June 20
------
Wuxi Honghui New Materials Technology Co., Ltd. (002802.SZ) issues shares at 9.52 yuan with a P/E ratio of 23 times and an upper subscription limit of 10,500 shares for each account. The company is principally engaged in PVC.
[Weekly Review]
○ To seek opportunities for stock gaming in right-side sectors
------
The A shares failed to join the MSCI Emerging Markets Index again last week. Many indexes reached the bottom and recovered after the news came out. Despite the slight drop of the index for the whole week, individual stocks related to new energy vehicles surged.
The new energy vehicles sector performed well for a long time. Many individual stocks in the sector surged despite the falling index, which is a typical right-side sector. Based on the 30-week average, the right-side sectors also covers 16 secondary industries of Shenwan Hongyuan Group Co., Ltd. (000166.SZ) , including include beverage manufacturing, white appliances, poultry and livestock raising, fodder, rare metals, gold, components, other electronics, motors, semiconductors.
There are 101 secondary industries of Shenwan Hongyuan, which means that 80 percent failed to perform well. It is likely to lose money. The current conditions are difficult to attract new investors or make stock investors invest more. Under the conditions of stock gaming, it lacks capital for continuous hiking. The investment in weak sectors also sees more declines with seldom rebound. The activated right-side sectors may see more opportunities as they are favored by capitals for various reasons.
TOP
○ Regulations on backdoor listing become stricter, Haiqi Transportation approved for IPO
○Terahertz radar developed, NASA announces all-electric plan program
○ WKW Automotive to develop new energy, Reorganizations of Gosun Holding and Jincheng Paper approved
○ Sojo Electric to invest in lithium-ion battery separators, Rainbow Fine Chemical proposes high share conversion in interim report
[SSN Focus]
○ CSRC revises measures for restructuring, regulations on backdoor listing become stricter
------
The China Securities Regulatory Commission (CSRC) on June 17 solicited for public opinions on revising the measures for major assets restructuring in listed companies. It specifies stricter requirements on backdoor listing by improving qualification standards, improving supporting regulation and strengthening responsibilities of intermediary organs. Qualification standards for change of controlling rights will expand from shareholding ratio to shareholding ratio, composition of board of directors and management control. It also cancels supporting financing for restructuring listed companies. Except for new controlling shareholders, the lock-in period for other new shareholders will extend from 12 months to 24 months.
Comment: The expanding qualification standards for backdoor listing will greatly restrict tricks and detour in backdoor listing. The cancellation of supporting financing and extension of lock-in period will make high requirement for strength of restructuring companies, and compress short-term profits of backdoor listed companies. The revision has a very clear aim: to standardized disorders about backdoor listing in the market, crack down speculations in shell companies and provide conditions for companies really qualified for backdoor listing.
○ Haiqi Transportation and others obtained IPO approval, shareholders to see equities value rise
------
The China Securities Regulatory Commission (CSRC) on June 17 approved the IPO applications of seven enterprises, including Hainan Haiqi Transportation Group Co., Ltd. and Bank of Jiangsu. The seven enterprises will raise a total of no more than 8.8 billion yuan. The annual report of Haiqi Transportation Group shows that its net profit recorded 69.91 million yuan last year. Hainan Expressway Co., Ltd. (000886.SZ) and Hainan Strait Shipping Co., Ltd. (002320.SZ) hold 25 and 5 percent equities in Haiqi Transportation Group . Bank of Jiangsu garnered net profit of 9.5 billion yuan last year. Black Peony (Group) Co., Ltd. (600510.SH), Jiangsu Hongtu High Technology Co., Ltd. (600122.SH), Jiangsu Wuzhong Industrial Co., Ltd. (600200.SH), Jiangsu High Hope International Group Corporation (600981.SH) and Jiangsu Yueda Investment Co., Ltd. (600805.SH) hold 1.06 percent, 0.96 percent, 0.5 percent, 0.48 percent and 0.48 percent equities in Bank of Jiangsu.
[SSN Selection]
○ When asked about the progress of the preparations for the Shenzhen-Hong Kong Stock Connect, Deng Ge, spokesperson for the China Securities Regulatory Commission (CSRC), on June 17 indicated that the program will launch at proper time within the year.
○ The CSRC specifically announced relevant works about termination of enterprise IPO review for the first time. It highlighted whether enterprises applying for IPO are in trouble during the review.
○ The CSRC preliminarily confirmed that Dandong Xintai Electric Co., Ltd. (300372.SZ) made fraud in IPO and violated laws and regulation in information disclosure. Once it is finalized, the company will delist.
○ China Business Journal reported that draft of the soil contamination prevention law has started. The law will highlight heavy metal pollution.
○ Vanke announced restructuring plans with Shenzhen Metro's capital injection. China Resources said that it is a groundless statement that the State-owned Assets Supervision and Administration Commission agreed it to buy Baoneng.
○ Financial officials from many countries speak support for Britain remaining in the EU. According to data from poll company BMG, respondents supporting for "Remain" rose to 53.3 percent.
TOP
[Industry Information]
○ CETC develops new radar, terahertz becomes highlight
------
The State Administration of Science, Technology and Industry for National Defense said on its website that China Electronics Technology Group Corporation (CETC) has successfully developed the first all solid-stateterahertz imaging radar system prototype. With few transmission loss in dense smoke and dust conditions, terahertz is an idea technology for detecting enemy and imaging in complicated battlefield environment. Terahertz can make stereoimaging for objects behind walls, detect perdu weapons and armed personnel, reveal tanks, artillery and other equipment in dust and smoke.
Comment: Terahertz has been a research highlight both at home and abroad in recent years, as it can be applied in various fields, such as life science, materials science, astronomy, atmospheric and environmental monitoring, communication. Among listed companies, Anhui Sun Create Electronics Co., Ltd. (600990.SH) is a company under CETC. The terahertz body security inspection device model developed by its substantial shareholder CETC No. 38 Research Institute has been on the market.
○ NASA announces all-electric plan program, battery and light-weight material to become key
------
NASA announced its all-electric aircraft program at a forum held by the American Institute of Aeronautics and Astronautics hold on June 17 local time, according to NASA's website. The plan is called X-17 which will has 14 propoller motors and can only contain one pilot. But NASA plans to develop 5 types of larger plans that can carry more passengers and goods. Chief engineer of the program said that if battery's energy density will continue grow as fast as it did in the past decade, the battery technology will allow the aircraft to be commercialized in the next 5 to 10 years.
Comment: Electricity-driven is expanding from the automobile industry from the aerospace industry. Apart from battery technology, light-weight material is another key for electricity-driven aircraft. In July 2015, the pure electric aircraft developed by Airbus made a successful flight over the English Channel. The aircraft is driven by lithium battery and adopts all carbon fibre composite material.
TOP
[Announcement Interpretation]
○ WKW Automotive to acquire equities of Kawei Auto with RMB1 bln to develop new energy vehicles
------
Beijing WKW Automotive Parts Co., Ltd. (002662.SZ) proposes to acquire 35 percent equities of Jiangsu Kawei Automotive Industrial Group with 1.05 billion yuan in cash to speed up the expansion in the new energy vehicle market.
Kawei Auto is an entity engaged in the production of light vehicles, passenger vehicles, special vehicles and components for vehicles. It is also a vehicle industrial platform for vehicle finance and the export of vehicles and the components. It successfully introduced Hummer electric vehicles in China and developed various new energy vehicles. It has obtained the rights for the production, modification and sales of Mercedes-Benz vans in China.
○ Reorganizations of Gosun Holding and Jincheng Paper approved
------
The significant assets reorganizations of Gosun Holding Co., Ltd. (000971.SZ) and Jincheng Paper Co., Ltd. (000820.SZ) were conditionally approved by the China Securities Regulatory Commission (CSRC).
TOP
○ Sojo Electric to invest in lithium-ion battery separators with RMB130 mln
------
Beijing Sojo Electric Co., Ltd. (300444.SZ) plans to increase the investment in Tianjin DG Membrane Tech. Co., Ltd. with 130 million yuan. It will become its biggest shareholder with 31 percent equities in the company. DG Membrane is a private high-tech enterprise professionally engaged in the research and sales of lithium-ion battery separators. It committed that its expected total net profit from 2016 to 2017 will be no less than 120 million yuan and the expected net profit in 2018 and 2019 will be no less than 180 million yuan and 230 million yuan, respectively.
------○ Boxin Investing sees changes in substantial shareholder
Tibet Kangsheng Investment Management Co., Ltd., a shareholder of Guangdong Boxin Investing ＆ Holdings Co., Ltd. (600083.SH), increased the shareholding in the company with 423,000 shares. It totally holds 15.18 percent shares of the company after the increase and becomes its biggest shareholder.
Kangsheng Investment is the securities investment platform under a wholly-owned subsidiary of Greattown Holdings Ltd. (600094.SH). It increased the shareholding in Boxin Investing in April. Kangsheng Investment indicated that it will hold the shares of the listed company for a long term to obtain revenues from equities appreciation.
○ China Merchants Group determines revenue proportion for land development in Qianhai
------
China Merchants Group, the controlling shareholder of China Merchants Shekou Industrial Zone Holdings Co., Ltd. (001979.SZ), and the Authority of Qianhai signed a framework agreement, proposing that a lot with 2.9km2 in the former Qianhai Bay Logistics Park of China Merchants Group will be under the cooperation scope. The two parties will establish a joint venture with the proportion of 50:50. The platform company controlled by China Merchants Shekou will participate in the establishment of the joint venture as a representative of the contribution party.
Comment: The signing of the above agreement means that the development of the huge land in Qianhai and its revenue proportion have been determined. The land is larger than the expected 2.4 km2. The listed company will benefit from the construction of Shekou Free Trade Zone in the future.
○ Rastar to acquire equities of Quwan Network with RMB970 mln to improve games industrial chain
------
Rastar Group (300043.SZ) intends to acquire 67.13 percent equities of Guangzhou Quwan Network Technology Co., Ltd. with 970 million yuan by issuing shares through private placement and in cash. Meanwhile, it will raise 970 million yuan. The issuing price of the shares issued for purchasing assets is 14.51 yuan per share. Based on the performance commitment, the net profit of Quwan Network will reach 10 million yuan in 2016. The total net profit will be 130 million yuan, 280 million and 480 million yuan in 2017, 2018 and 2019.
Comment: Quwan Network is a mobile entertainment community supplier. It will provide community management services for games users and games groups through the IT social entertainment platform. It will focus on medium and high games users and implement the pan-games strategy.
[Financial Reports Express]
○ Rainbow Fine Chemical proposes high share conversion in interim report
------
The actual controller of Shenzhen Rainbow Fine Chemical Industry Co., Ltd. (002256.SZ) proposes a 30-for-10 conversion of capital surplus into shares according to its interim report. The actual controller of Shenzhen H＆T Intelligent Control Co., Ltd. (002402.SZ) proposes a 13-for-10 conversion of capital surplus into shares combined with 2 shares and 0.2 yuan dividend for every 10 shares according to its interim report.
[Trading Alarms]
○ Honghui New Materials for subscription June 20
------
Wuxi Honghui New Materials Technology Co., Ltd. (002802.SZ) issues shares at 9.52 yuan with a P/E ratio of 23 times and an upper subscription limit of 10,500 shares for each account. The company is principally engaged in PVC.
[Weekly Review]
○ To seek opportunities for stock gaming in right-side sectors
------
The A shares failed to join the MSCI Emerging Markets Index again last week. Many indexes reached the bottom and recovered after the news came out. Despite the slight drop of the index for the whole week, individual stocks related to new energy vehicles surged.
The new energy vehicles sector performed well for a long time. Many individual stocks in the sector surged despite the falling index, which is a typical right-side sector. Based on the 30-week average, the right-side sectors also covers 16 secondary industries of Shenwan Hongyuan Group Co., Ltd. (000166.SZ) , including include beverage manufacturing, white appliances, poultry and livestock raising, fodder, rare metals, gold, components, other electronics, motors, semiconductors.
There are 101 secondary industries of Shenwan Hongyuan, which means that 80 percent failed to perform well. It is likely to lose money. The current conditions are difficult to attract new investors or make stock investors invest more. Under the conditions of stock gaming, it lacks capital for continuous hiking. The investment in weak sectors also sees more declines with seldom rebound. The activated right-side sectors may see more opportunities as they are favored by capitals for various reasons.
TOP
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