[Today's Guide]
○ New electrical power reform took important moves, power generation plan to actually open
○ Management method for transaction of carbon emission reduction to issue, pipeline network construction likely to speeds up
○ Noblift Equipment Joint Stock to expand in intelligent logistics, New Nanshan Holding to merge with Chiwan Petroleum Supply Base
○ China Supply and Marketing Agricultural Production Wholesale Market Holding likely to control shareholder of Changjiu Biochemical Industry, Sundiro to promote restructuring
[SSN Focus]
○ New electrical power reform took important moves, power generation plan to actually open
------
Bureau of Economic Operation Adjustment under the National Development and Reform Commission (NDRC) recently issued a notice to search for public opinions on Notice of Preparation Work to Orderly Open Electrical Power Usage (exposure) formulated by the NDRC and National Energy Administration. The drafted exposure mainly includes the content of speeding up coal power enterprises to sign power generation and purchase agreement with power sales companies and users, guiding these users to participate in market trades, opening the coal power transmission plan among provinces and regions, studying modes involving in the market, such as large hydroelectric power, nuclear power and etc.
Comment: It has been the strongest measure since this round of power reform. Market-oriented electrical power reform is likely to expand based on different power generation types nationwide to benefit all aspects of electrical power market. Power sales companies can select supplies based on more choices, and this market will rapid expand. Low-cost hydroelectric power enterprises will also gradually gain rational and market-oriented power price. According to statistics of Guotai Junan Securities, Jilin Power Share Co., Ltd. (000875.SZ), Inner Mongolia MengDian HuaNeng Thermal Power Corporation Limited (600863.SH) and etc. have established power sales companies; average grid purchase prices of Guangxi Guiguan Electric Power Co., Ltd. (600263.SH) and Guizhou Qianyuan Power Co., Ltd. (002039.SZ) are respectively 0.27 and 0.315 yuan per kilowatt hour, with rising space. Big power consumers, like electrolytic aluminum, will benefit from cost reduction. Yunnan Aluminium Co., Ltd. (000807.SZ) and Henan Zhongfu Industrial Co., Ltd. (600595.SH) having involved in direct power purchase pilot are attractive to institutions.
[SSN Selection]
○ The Opinion on Deepening Investment ＆ Financing System Reform had been issued on July 18, which proposed to carry out pilot work that financial institutions legally hold equities of enterprises.
○ The central bank on July 18 operated the MLF of 227 billion yuan, which is a MLF operation of 200 billion yuan for the second time within six days.
○ Shanghai Stock Exchange announced to revise pilot rules for Shanghai-Hong Kong Stock Connect program, and planned to correspondingly add auction period at the closing of Southbound Trading based on new policies of HKEx.
○ Based on the latest disclosure of HKEx, Lu Zhiqiang, chairman of Oceanwide Holdings Co., Ltd. (000046.SZ), on July 14 increased 449 million shareholdings in China Minsheng Banking Corp., Ltd. (600016.SH) in the A-share market, accounting for 5.19 percent of the total equity.
○ Shanghai Observation microblog under Shanghai United Media Group disclosed that a draft action to remove Chongming county and build up Chongming District will be submitted to the executive meeting of Shanghai Municipal People's Congress for deliberation and vote.
TOP
[Industry Information]
○ Management method for transaction of carbon emission reduction to issue, emission right market formation speeds up
------
SSN learns that Management Method of Voluntary Emission Reduction Transaction of Greenhouse Gases is likely to issue within this month, and it will mutually support the forced emission reduction measures. This is one of the preparation work at an early stage so as to build up a national carbon emission transaction market in 2017, aiming to gradually lay technology and rule foundation for carbon emission right transaction with overall emission under control. In June 2012, the National Development and Reform Commission (NDRC) issued temporary Method to this respect.
Comment: Shenwan Hongyuan Securities expects that just electrical power market nationwide will realize the emission reduction of around 400 million tons in next five years, with total transactions of about 8 billion yuan; transactions covering 18 key industries in China will possibly expand to 1 to 2 billion tons, with 20 to 40 billion yuan. Along with gradually formed carbon emission
○ Pipeline network separation may become key point of oil ＆ gas reform, pipeline network construction likely to speeds up
------
SSN learns that oil and natural gas system reform greatly boosting "separation of oil ＆ gas main pipelines" will become one of the key points during the industrial reform in the second half year. Experts indicate that pipeline network separation is a relatively determined goal. Related scheme will possibly be disclosed at the end of this year, if the reform consensus is smoothly realized. After that, related authorities will formulate the corresponding special reform schemes and supporting documents, and firstly carry out pilots in some provinces and cities.
Comment: Pipeline network separation will break the monopoly situation, and lay foundation for oil ＆ gas field to bring in social capital. Currently, China's pipeline network development is lagged, with pipeline transmission capability not matching the demands. Along with diversified investors and reinforced investment enthusiasm in the future, pipeline network construction is likely to speed up. Listed companies, including Zhejiang Kingland Pipeline and Technologies Co., Ltd. (002443.SZ) and Zhejiang Kingland Pipeline and Technologies Co., Ltd. (002478.SZ), are involved in oil ＆ gas pipeline business.
TOP
[Announcement Interpretation]
○ Noblift Equipment Joint Stock to control Wuxi Zhongding Logistics Equipment to expand in intelligent logistics
------
Noblift Equipment Joint Stock Co., Ltd. (603611.SH) plans to purchase 90 percent equity of Wuxi Zhongding Logistics Equipment Co., Ltd. at 540 million yuan by issuing 14.87 million shares through private placement and paying 216 yuan in cash. Also the company will raise supporting funds worth 239 million yuan from its actual controller Ding Yi through private placement. The shares will be issued at 21.79 yuan per share. Net profit of Wuxi Zhongding Logistics Equipment is promised to be no less than 32 million yuan, 50 million yuan and 68 million yuan during 2016 and 2018 respectively.
Wuxi Zhongding Logistics Equipment is mainly engaged in research, manufacturing, installation and trial run of intelligentized logistics system integration and relevant logistics equipment. Noblift Equipment Joint Stock is specialized in manufacturing and selling light and small industrial truck and electric storage vehicles. This acquisition is an important step of building large logistics platform under the background of Industry 4.0.
○ New Nanshan Holding to merge with Chiwan Petroleum Supply Base to get through industrial chain of real estate and logistics
------
Shenzhen New Nanshan Holding (Group) Co., Ltd. (002314.SZ) plans to merge with Shenzhen Chiwan Petroleum Supply Base Co., Ltd. through stock swap. Share price of New Nanshan Holding is 5.64 yuan per share and share price of Chiwan Petroleum Supply Base is 19.55 yuan per share after stock swap. The swap proportion is 1:3.4663. The two companies' cash option exercise prices are 5.64 yuan per share and 18.28 Hong Kong dollars per share respectively.
After the deal is done, the surviving company intends to raise supporting funds of 1.65 billion yuan at a price of 5.64 yuan per share through private placement from Yantai Guokai Hanfu Rongxiang Investment Center (Limited Partnership) and Yantai Guokai Hanfu Guifu Investment Center (Limited Partnership). The fundraising will be used to invest in Baowan international logistics park in Tianjin harbor. New Nanshan Holding now is mainly engaged in real estate development. When the merger is finished, the surviving company is bale to strengthen ability of acquiring land resource and get through industrial chain between logistics real estate and residential properties via the business scale and resource advantage of Chiwan Petroleum Supply Base in logistics field.
TOP
○ China Supply and Marketing Agricultural Production Wholesale Market Holding expected to be new controlling shareholder of Changjiu Biochemical Industry
------
Ganzhou Gong Tou Group Co., Ltd., indirect controlling shareholder of Jiangxi Changjiu Biochemical Industry Co., Ltd. (600228.SH), recently signed framework agreement on equity transfer with China Supply and Marketing Agricultural Production Wholesale Market Holding Co., Ltd. The company plans to transfer 85.40 percent equity of its direct controlling shareholder Jiangxi Changjiu Biochemical Group Co., Ltd. to the latter or specific related party. After the deal is completed, China Supply and Marketing Agricultural Production Wholesale Market Holding might become the indirect controlling shareholder of the company.
Comment: Although China Supply and Marketing Agricultural Production Wholesale Market Holding had suspended the original restructuring plan, but it indicated in the latest report on equity change that the purchase of receiving this share transfer is to effectively integrate resources and build qualified listed company platform by taking advantage of listed company platform.
○ Sundiro to resume trading, continuing to promote restructuring
------
Sundiro Holding Co., Ltd. (000571.SZ) released announcement that it would continue to promote acquisition of equity of Heilongjiang Hengyang Cattle industry Co., Ltd. The company is going to resume trading from July 19. The market saw significant increase during trading suspension of the company.
○ Honyu Wear-Resistant New Materials to launch private placement
------
Honyu Wear-Resistant New Materials Co., Ltd. (300345.SZ) plans to raise 500 million yuan by issuing about 55 million shares at a price of 9.08 yuan per share (with ex-dividend) through private placement from its controlling shareholder Zhu Hongyu and Shenzhen Ruide Venture Equity Investment Fund Company (Limited Partnership). The fundraising will be invested in industrialization project of PIP controllable ion permeation technology. Zhu will subscribe more than 33 million shares.
PIP technology is a surface processing technology which is developed to replace traditional electrochromism technique. The smooth implementation of this private placement will meet the demand of premium auto components and parts, parts of light military weapon and parts of high-speed rail for PIP processing.
[Financial Reports Express]
○ Net profit of Xi'an Longi Silicon Materials Corp. to up by 600 pct.
------
Net profit of Xi'an Longi Silicon Materials Corp. (601012.SH) is predicted to surge by 630 percent according to its semiannual report due to increasing sales of monocrystalline silicon piece and module. Net profit of Hengtong Optic-electric Co., Ltd. (600487.SH) is expected to increase by 150-200 percent according to its semiannual report owing to consolidated financial statements with Shenzhen UWay Technology Co., Ltd., Heilongjiang GAMMA Telecom Engineering Co., Ltd. and Fuzhou One Sun Power Consulting Co., Ltd. Net profit of Xiamen ITG Group Corp., Ltd. (600755.SZ) is estimated to grow by 50-100 percent according to its semiannual report as three major businesses including supply chain management, real estate industry and financial service see sound development.
[Trading Trends]
○ Zhifei Biological Products bought through 3 institutional seats
------
The trading volume ranking list on July 18 shows that Chongqing Zhifei Biological Products Co., Ltd. (300122.SZ) was bought through three institutional seats with a total of 102 million yuan, accounting for 44.76 percent of its intraday turnover, and was sold through one institutional seat with 33.93 million yuan.
Comment: GlaxoSmithKline PLC's (GSK) announced on July 18 its Cervarix, the first vaccine against human papilloma virus (HPV), has been approved for use in the mainland by the mainland's Food and Drug Administration. Statistics show that the potential market size of HPV vaccine may reach several billions. Zhifei Biological Products is specialized in production and agency of vaccine and its annual report shows that registration of HPV vaccine product of Merck Sharp ＆ Dohme Corp. is under regulatory approval stage.
[Trading Alarms]
○ Sanxiang Advanced Materials to launch IPO on July 19
------
Sanxiang Advanced Materials Co., Ltd., (732663) is going to launch IPO at a price of 5.28 yuan per share with upper limit of 13,000 shares for each account. The PE ratio is 23 times. The company is engaged in electric-melting zirconia and casting modified material.
TOP
○ New electrical power reform took important moves, power generation plan to actually open
○ Management method for transaction of carbon emission reduction to issue, pipeline network construction likely to speeds up
○ Noblift Equipment Joint Stock to expand in intelligent logistics, New Nanshan Holding to merge with Chiwan Petroleum Supply Base
○ China Supply and Marketing Agricultural Production Wholesale Market Holding likely to control shareholder of Changjiu Biochemical Industry, Sundiro to promote restructuring
[SSN Focus]
○ New electrical power reform took important moves, power generation plan to actually open
------
Bureau of Economic Operation Adjustment under the National Development and Reform Commission (NDRC) recently issued a notice to search for public opinions on Notice of Preparation Work to Orderly Open Electrical Power Usage (exposure) formulated by the NDRC and National Energy Administration. The drafted exposure mainly includes the content of speeding up coal power enterprises to sign power generation and purchase agreement with power sales companies and users, guiding these users to participate in market trades, opening the coal power transmission plan among provinces and regions, studying modes involving in the market, such as large hydroelectric power, nuclear power and etc.
Comment: It has been the strongest measure since this round of power reform. Market-oriented electrical power reform is likely to expand based on different power generation types nationwide to benefit all aspects of electrical power market. Power sales companies can select supplies based on more choices, and this market will rapid expand. Low-cost hydroelectric power enterprises will also gradually gain rational and market-oriented power price. According to statistics of Guotai Junan Securities, Jilin Power Share Co., Ltd. (000875.SZ), Inner Mongolia MengDian HuaNeng Thermal Power Corporation Limited (600863.SH) and etc. have established power sales companies; average grid purchase prices of Guangxi Guiguan Electric Power Co., Ltd. (600263.SH) and Guizhou Qianyuan Power Co., Ltd. (002039.SZ) are respectively 0.27 and 0.315 yuan per kilowatt hour, with rising space. Big power consumers, like electrolytic aluminum, will benefit from cost reduction. Yunnan Aluminium Co., Ltd. (000807.SZ) and Henan Zhongfu Industrial Co., Ltd. (600595.SH) having involved in direct power purchase pilot are attractive to institutions.
[SSN Selection]
○ The Opinion on Deepening Investment ＆ Financing System Reform had been issued on July 18, which proposed to carry out pilot work that financial institutions legally hold equities of enterprises.
○ The central bank on July 18 operated the MLF of 227 billion yuan, which is a MLF operation of 200 billion yuan for the second time within six days.
○ Shanghai Stock Exchange announced to revise pilot rules for Shanghai-Hong Kong Stock Connect program, and planned to correspondingly add auction period at the closing of Southbound Trading based on new policies of HKEx.
○ Based on the latest disclosure of HKEx, Lu Zhiqiang, chairman of Oceanwide Holdings Co., Ltd. (000046.SZ), on July 14 increased 449 million shareholdings in China Minsheng Banking Corp., Ltd. (600016.SH) in the A-share market, accounting for 5.19 percent of the total equity.
○ Shanghai Observation microblog under Shanghai United Media Group disclosed that a draft action to remove Chongming county and build up Chongming District will be submitted to the executive meeting of Shanghai Municipal People's Congress for deliberation and vote.
TOP
[Industry Information]
○ Management method for transaction of carbon emission reduction to issue, emission right market formation speeds up
------
SSN learns that Management Method of Voluntary Emission Reduction Transaction of Greenhouse Gases is likely to issue within this month, and it will mutually support the forced emission reduction measures. This is one of the preparation work at an early stage so as to build up a national carbon emission transaction market in 2017, aiming to gradually lay technology and rule foundation for carbon emission right transaction with overall emission under control. In June 2012, the National Development and Reform Commission (NDRC) issued temporary Method to this respect.
Comment: Shenwan Hongyuan Securities expects that just electrical power market nationwide will realize the emission reduction of around 400 million tons in next five years, with total transactions of about 8 billion yuan; transactions covering 18 key industries in China will possibly expand to 1 to 2 billion tons, with 20 to 40 billion yuan. Along with gradually formed carbon emission
○ Pipeline network separation may become key point of oil ＆ gas reform, pipeline network construction likely to speeds up
------
SSN learns that oil and natural gas system reform greatly boosting "separation of oil ＆ gas main pipelines" will become one of the key points during the industrial reform in the second half year. Experts indicate that pipeline network separation is a relatively determined goal. Related scheme will possibly be disclosed at the end of this year, if the reform consensus is smoothly realized. After that, related authorities will formulate the corresponding special reform schemes and supporting documents, and firstly carry out pilots in some provinces and cities.
Comment: Pipeline network separation will break the monopoly situation, and lay foundation for oil ＆ gas field to bring in social capital. Currently, China's pipeline network development is lagged, with pipeline transmission capability not matching the demands. Along with diversified investors and reinforced investment enthusiasm in the future, pipeline network construction is likely to speed up. Listed companies, including Zhejiang Kingland Pipeline and Technologies Co., Ltd. (002443.SZ) and Zhejiang Kingland Pipeline and Technologies Co., Ltd. (002478.SZ), are involved in oil ＆ gas pipeline business.
TOP
[Announcement Interpretation]
○ Noblift Equipment Joint Stock to control Wuxi Zhongding Logistics Equipment to expand in intelligent logistics
------
Noblift Equipment Joint Stock Co., Ltd. (603611.SH) plans to purchase 90 percent equity of Wuxi Zhongding Logistics Equipment Co., Ltd. at 540 million yuan by issuing 14.87 million shares through private placement and paying 216 yuan in cash. Also the company will raise supporting funds worth 239 million yuan from its actual controller Ding Yi through private placement. The shares will be issued at 21.79 yuan per share. Net profit of Wuxi Zhongding Logistics Equipment is promised to be no less than 32 million yuan, 50 million yuan and 68 million yuan during 2016 and 2018 respectively.
Wuxi Zhongding Logistics Equipment is mainly engaged in research, manufacturing, installation and trial run of intelligentized logistics system integration and relevant logistics equipment. Noblift Equipment Joint Stock is specialized in manufacturing and selling light and small industrial truck and electric storage vehicles. This acquisition is an important step of building large logistics platform under the background of Industry 4.0.
○ New Nanshan Holding to merge with Chiwan Petroleum Supply Base to get through industrial chain of real estate and logistics
------
Shenzhen New Nanshan Holding (Group) Co., Ltd. (002314.SZ) plans to merge with Shenzhen Chiwan Petroleum Supply Base Co., Ltd. through stock swap. Share price of New Nanshan Holding is 5.64 yuan per share and share price of Chiwan Petroleum Supply Base is 19.55 yuan per share after stock swap. The swap proportion is 1:3.4663. The two companies' cash option exercise prices are 5.64 yuan per share and 18.28 Hong Kong dollars per share respectively.
After the deal is done, the surviving company intends to raise supporting funds of 1.65 billion yuan at a price of 5.64 yuan per share through private placement from Yantai Guokai Hanfu Rongxiang Investment Center (Limited Partnership) and Yantai Guokai Hanfu Guifu Investment Center (Limited Partnership). The fundraising will be used to invest in Baowan international logistics park in Tianjin harbor. New Nanshan Holding now is mainly engaged in real estate development. When the merger is finished, the surviving company is bale to strengthen ability of acquiring land resource and get through industrial chain between logistics real estate and residential properties via the business scale and resource advantage of Chiwan Petroleum Supply Base in logistics field.
TOP
○ China Supply and Marketing Agricultural Production Wholesale Market Holding expected to be new controlling shareholder of Changjiu Biochemical Industry
------
Ganzhou Gong Tou Group Co., Ltd., indirect controlling shareholder of Jiangxi Changjiu Biochemical Industry Co., Ltd. (600228.SH), recently signed framework agreement on equity transfer with China Supply and Marketing Agricultural Production Wholesale Market Holding Co., Ltd. The company plans to transfer 85.40 percent equity of its direct controlling shareholder Jiangxi Changjiu Biochemical Group Co., Ltd. to the latter or specific related party. After the deal is completed, China Supply and Marketing Agricultural Production Wholesale Market Holding might become the indirect controlling shareholder of the company.
Comment: Although China Supply and Marketing Agricultural Production Wholesale Market Holding had suspended the original restructuring plan, but it indicated in the latest report on equity change that the purchase of receiving this share transfer is to effectively integrate resources and build qualified listed company platform by taking advantage of listed company platform.
○ Sundiro to resume trading, continuing to promote restructuring
------
Sundiro Holding Co., Ltd. (000571.SZ) released announcement that it would continue to promote acquisition of equity of Heilongjiang Hengyang Cattle industry Co., Ltd. The company is going to resume trading from July 19. The market saw significant increase during trading suspension of the company.
○ Honyu Wear-Resistant New Materials to launch private placement
------
Honyu Wear-Resistant New Materials Co., Ltd. (300345.SZ) plans to raise 500 million yuan by issuing about 55 million shares at a price of 9.08 yuan per share (with ex-dividend) through private placement from its controlling shareholder Zhu Hongyu and Shenzhen Ruide Venture Equity Investment Fund Company (Limited Partnership). The fundraising will be invested in industrialization project of PIP controllable ion permeation technology. Zhu will subscribe more than 33 million shares.
PIP technology is a surface processing technology which is developed to replace traditional electrochromism technique. The smooth implementation of this private placement will meet the demand of premium auto components and parts, parts of light military weapon and parts of high-speed rail for PIP processing.
[Financial Reports Express]
○ Net profit of Xi'an Longi Silicon Materials Corp. to up by 600 pct.
------
Net profit of Xi'an Longi Silicon Materials Corp. (601012.SH) is predicted to surge by 630 percent according to its semiannual report due to increasing sales of monocrystalline silicon piece and module. Net profit of Hengtong Optic-electric Co., Ltd. (600487.SH) is expected to increase by 150-200 percent according to its semiannual report owing to consolidated financial statements with Shenzhen UWay Technology Co., Ltd., Heilongjiang GAMMA Telecom Engineering Co., Ltd. and Fuzhou One Sun Power Consulting Co., Ltd. Net profit of Xiamen ITG Group Corp., Ltd. (600755.SZ) is estimated to grow by 50-100 percent according to its semiannual report as three major businesses including supply chain management, real estate industry and financial service see sound development.
[Trading Trends]
○ Zhifei Biological Products bought through 3 institutional seats
------
The trading volume ranking list on July 18 shows that Chongqing Zhifei Biological Products Co., Ltd. (300122.SZ) was bought through three institutional seats with a total of 102 million yuan, accounting for 44.76 percent of its intraday turnover, and was sold through one institutional seat with 33.93 million yuan.
Comment: GlaxoSmithKline PLC's (GSK) announced on July 18 its Cervarix, the first vaccine against human papilloma virus (HPV), has been approved for use in the mainland by the mainland's Food and Drug Administration. Statistics show that the potential market size of HPV vaccine may reach several billions. Zhifei Biological Products is specialized in production and agency of vaccine and its annual report shows that registration of HPV vaccine product of Merck Sharp ＆ Dohme Corp. is under regulatory approval stage.
[Trading Alarms]
○ Sanxiang Advanced Materials to launch IPO on July 19
------
Sanxiang Advanced Materials Co., Ltd., (732663) is going to launch IPO at a price of 5.28 yuan per share with upper limit of 13,000 shares for each account. The PE ratio is 23 times. The company is engaged in electric-melting zirconia and casting modified material.
TOP
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