[Today's Guide]
○ Well-performing funds stress investment with certainty, favor new energy vehicle and military industries
○ NDRC promotes construction of charging facilities, MEK prices continue to rise
○ Guangyu Development to acquire property assets, Longzhou Transportation to acquire bitumen and logistics enterprise
○ Ellassay Fashion to control IRO, three institutional seats buy H＆T Intelligent Control
[SSN Focus]
○ Well-performing funds stress investment with certainty, favor new energy vehicle and military industries
------
As funds disclose their second-quarter reports, their investment strategies for the third quarter have also emerged. According to SSN's statistics, well-performing funds are cautious about the market performance in the third quarter, and choose to counterattack. A great number of funds are bullish about two sectors: the new energy vehicle sector that will certainly see performance grow and can create new consumption field; the military industry that sees expectations for state-owned enterprises reform and are frequently driven by events.
As for positions, most equity-leaning mixed funds hold a neutral level of about 80 percent positions in equity. Funds also diverge in positions. For example, Aegon Industrial Social Responsibility Mixed Fund (fund code: 340007) holds as high as 90.38 percent positions at the end of the quarter. Aegon Industrial New Vision Open-end Mixed Fund (fund code: 001511), another fund managed by celebrity fund manager, holds only 42.72 positions in equity.
[SSN Selection]
○ At a working conference on promoting the healthy development of social investment on July 18, Premier Li Keqiang calls for attracting more social capital into the social services fields such as education, health care and elderly care.
○ Lian Weiliang, deputy director of the National Development and Reform Commission, noted on July 19 that 276 working days will be a new normal in the coal industry, and the government will increase efforts to eliminate backward productivity.
○ The Ministry of Environmental Protection indicated that the first batch of the environmental protection inspection team has arrived local areas and will promote works on the ecological civilization construction and environmental protection in inspected areas.
○ Last week China's securities margin recorded net outflow for the fourth straight week. The proportion of investors fell to a new low in the year.
○ China Vanke Co., Ltd. (000002.SZ) on July 19 reported Baoneng Group to regulators, saying that the average shareholding cost for the nine asset management plans controlled by Jushenghua Co., Ltd. is 18.89 yuan per share.
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[Industry Information]
○ NDRC promotes construction of charging facilities, operation enterprise likely to have bright future
------
The National Development and Reform Commission (NDRC) says on its website that its Department of Basic Industries has had a discussion with local development and reform commissions, charging infrastructure service enterprises and State Grid Corporation of China at a coordination meeting. It listened to the progress of and the demands for the construction of charging facilities across the nation, and studies measures to promote the construction of charging facilities while combining with the construction of parking lots. Further moves will be taken based on practical situation and existing problems in the integrated construction of parking lots and charging infrastructure, especially on problems such as short supply of parking lots, too many investors in social parking lots and relatively monotonous profit model in charging facilities enterprises.
Comment: Institutions believe that demands for charging piles will expand further in the next half. It is more certain that investment will be made in charging pile operation. If new and profitable operation models appear in the future, relevant companies will have brilliant prospects considering the huge charging service market. Beijing Bus Co., Ltd., the substantial shareholder of Beijing Bashi Media Co., Ltd. (600386.SH), is expected to lead in buss and taxi charging business in Beijing via its charging pile operation company. Qingdao TGOOD Electric Co., Ltd. (300001.SZ) has continued to increase investment in charging pile operation business since the beginning of the year.
○ MEK prices continue surging to new high in a year
------
SSN learnt that driven by the short supply, the market prices of methyl ethyl ketone (MEK) surged on July 19 with 100 to 200 yuan per ton. It has recorded an increase of over 24 percent in recent month. The quoted prices of major manufactures have reached new high in recent years. The quoted prices of PetroChina Fushun Petrochemical Company and PetroChina Lanzhou Petrochemical Company reached 5,500 to 5,800 yuan per ton. Due to the low inventory in the market, the supply of traders is limited.
Comment: As the production equipment of some enterprises are under overhauls, the market inventory is relatively low. The MEK price may continue to surge in the future. Among listed companies, Zibo Qixiang Tengda Chemical Co., Ltd. (002408.SZ) owns an MEK capacity of 180,000 tons, accounting for nearly half of the domestic market share. Its 2015 annual report shows that the business contributes nearly 30 percent of its main businesses. The phase-I MEK equipment of Zhejiang Haiyue Co., Ltd. (600387.SH) with a capacity of 40,000 tons has been put into operation.
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[Announcement Interpretation]
○ Guangyu Development to acquire property assets with RMB8.7 bln
------
Tianjin Guangyu Development Co., Ltd. (000537.SZ) proposes to acquire 34.5 percent, 65 percent, 100 percent and 100 percent equities of Chongqing Luneng, Yibin Luneng, Luneng Genfu and Shunxi Xincheng from its substantial shareholder and 30 percent equities of Chongqing Luneng Yingda held by the Century Hengmei with 8,729 million yuan by issuing shares at 6.81 yuan per share through private placement. Meanwhile, the company plans to raise a supporting fund of 8,729 million yuan by issuing shares at no less than 6.94 yuan per share.
Chongqing Luneng, Yibin Luneng, Luneng Genfu and Shunxi Xincheng are property development enterprises with the national Level-I development qualification while Chongqing Luneng Yingda is a property enterprise with the national Level-II development qualification. The State Grid Corporation of China became the actual controller of the company from 2008 and the transaction constitutes a backdoor listing.
○ Longzhou Transportation to acquire bitumen and logistics enterprise, connected parties to subscribe 90 pct
------
Fujian Longzhou Transportation Co., Ltd. (002682.SZ) intends to acquire 100 percent equities of Tianjin Zhaohua Leading Co., Ltd. with 1,242 million yuan by issuing shares at 12.06 yuan per share through private placement and in cash. Meanwhile, the company proposes to raise a supporting fund of 580 million yuan by issuing shares at 10.58 yuan per share through private placement. The controlling shareholder and the employee assets management plan of the company will invest 400 million yuan and 120 million yuan in the subscription.
Zhaohua Leading is principally engaged in bitumen logistics and trade and the processing of modified bitumen. Its committed net profits from 2016 to 2018 are 85 million yuan, 105 million yuan and 125 million yuan, respectively.
TOP
○ Ellassay Fashion to control IRO to advance high-end fashion strategy
------
Shenzhen Ellassay Fashion Co., Ltd. (603808.SH) plans to purchase 16 percent equities of Qianhai Shanglin. Ellassay Fashion will hold 65 percent equities of Qianhai Shanglin after the completion of the acquisition and indirectly control over companies with their IRO through Qianhai Shanglin. The "IRO" brand was established in 2004 and is positioned in the brand design in light luxury industry. It has entered the U.S., Germany, Denmark and South Korean. The acquisition is an important strategy in developing high-end fashion group in China by Ellassay Fashion.
○ Huasheng Tianlong Photoeletric sees actual controller changes
------
Beijing Lingguang Energy Investment Co., Ltd., a substantial shareholder of Jiangsu Huasheng Tianlong Photoeletric Co., Ltd. (300029.SZ) signed an equity transfer agreement with Chen Hua on July 18. Chen will acquire 50 percent equities of Lingguang Energy Investment with 100 million yuan and indirectly control 40,457,200 shares or 20.23 percent equities of the listed company, making him the new actual controller of the company. Chen is rosy about the prospects of the PV industry in the medium and long term and may continue increasing the shareholding in the following year.
○ Dong Yi Ri Sheng Home Decoration to expand intelligent logistics and storage through private placement
------
Dong Yi Ri Sheng Home Decoration Group Co., Ltd. (002713.SZ) plans to raise 700 million yuan by issuing 27.15 million shares at 25.78 yuan per share through private placement. The proceeds will be invested in the establishment of an intelligent logistics and storage management platform in the home decoration industry and an experiencing system for digital home decoration.
[Financial Reports Express]
○ Protruly Vision Technology expects performance growth
------
Jiangsu Protruly Vision Technology Group Co., Ltd. (600074.SH) expects an increase of 225 to 250 percent in the interim report thanks to the surging vehicle video businesses. Fangda Special Steel Technology Co., Ltd. (600507.SH) expects an increase of 75 percent in the interim report as a result of the bigger cost reduction than revenue decrease.
[Trading Trends]
○ Three institutional seats buy H＆T Intelligent Control
------
The trading volume ranking list on July 19 shows that three institutional seats bought Shenzhen H＆T Intelligent Control Co., Ltd. (002402.SZ) with a total of 149 million yuan, accounting for 34.74 percent of its intraday turnover.
Comment: The company recently announced the establishment of a research center with Shenzhen Academy of Aerospace Technology to be engaged in the technical development, products development, the transformation of technical results and the industrial operation of the ARM system chips and their application, the Internet of Things sensing technologies, the Internet of Things communications and networking technologies and the intelligent hardware for the Internet of Things. Institutes believe that the Soft Bank announced the acquisition of ARM with huge capitals. It meets the strategy of the company and enjoys a bright future.
[Trading Alarms]
○ Bank of Jiangsu to conduct IPO to July 20
------
Bank of Jiangsu Co., Ltd. (600919.SH) will issue shares at 6.27 yuan with an upper subscription limit of 346,000 shares for each account. The issuing price is equivalent to the current net asset per share with the corresponding P/E ratio of 7.64 times.
TOP
○ Well-performing funds stress investment with certainty, favor new energy vehicle and military industries
○ NDRC promotes construction of charging facilities, MEK prices continue to rise
○ Guangyu Development to acquire property assets, Longzhou Transportation to acquire bitumen and logistics enterprise
○ Ellassay Fashion to control IRO, three institutional seats buy H＆T Intelligent Control
[SSN Focus]
○ Well-performing funds stress investment with certainty, favor new energy vehicle and military industries
------
As funds disclose their second-quarter reports, their investment strategies for the third quarter have also emerged. According to SSN's statistics, well-performing funds are cautious about the market performance in the third quarter, and choose to counterattack. A great number of funds are bullish about two sectors: the new energy vehicle sector that will certainly see performance grow and can create new consumption field; the military industry that sees expectations for state-owned enterprises reform and are frequently driven by events.
As for positions, most equity-leaning mixed funds hold a neutral level of about 80 percent positions in equity. Funds also diverge in positions. For example, Aegon Industrial Social Responsibility Mixed Fund (fund code: 340007) holds as high as 90.38 percent positions at the end of the quarter. Aegon Industrial New Vision Open-end Mixed Fund (fund code: 001511), another fund managed by celebrity fund manager, holds only 42.72 positions in equity.
[SSN Selection]
○ At a working conference on promoting the healthy development of social investment on July 18, Premier Li Keqiang calls for attracting more social capital into the social services fields such as education, health care and elderly care.
○ Lian Weiliang, deputy director of the National Development and Reform Commission, noted on July 19 that 276 working days will be a new normal in the coal industry, and the government will increase efforts to eliminate backward productivity.
○ The Ministry of Environmental Protection indicated that the first batch of the environmental protection inspection team has arrived local areas and will promote works on the ecological civilization construction and environmental protection in inspected areas.
○ Last week China's securities margin recorded net outflow for the fourth straight week. The proportion of investors fell to a new low in the year.
○ China Vanke Co., Ltd. (000002.SZ) on July 19 reported Baoneng Group to regulators, saying that the average shareholding cost for the nine asset management plans controlled by Jushenghua Co., Ltd. is 18.89 yuan per share.
TOP
[Industry Information]
○ NDRC promotes construction of charging facilities, operation enterprise likely to have bright future
------
The National Development and Reform Commission (NDRC) says on its website that its Department of Basic Industries has had a discussion with local development and reform commissions, charging infrastructure service enterprises and State Grid Corporation of China at a coordination meeting. It listened to the progress of and the demands for the construction of charging facilities across the nation, and studies measures to promote the construction of charging facilities while combining with the construction of parking lots. Further moves will be taken based on practical situation and existing problems in the integrated construction of parking lots and charging infrastructure, especially on problems such as short supply of parking lots, too many investors in social parking lots and relatively monotonous profit model in charging facilities enterprises.
Comment: Institutions believe that demands for charging piles will expand further in the next half. It is more certain that investment will be made in charging pile operation. If new and profitable operation models appear in the future, relevant companies will have brilliant prospects considering the huge charging service market. Beijing Bus Co., Ltd., the substantial shareholder of Beijing Bashi Media Co., Ltd. (600386.SH), is expected to lead in buss and taxi charging business in Beijing via its charging pile operation company. Qingdao TGOOD Electric Co., Ltd. (300001.SZ) has continued to increase investment in charging pile operation business since the beginning of the year.
○ MEK prices continue surging to new high in a year
------
SSN learnt that driven by the short supply, the market prices of methyl ethyl ketone (MEK) surged on July 19 with 100 to 200 yuan per ton. It has recorded an increase of over 24 percent in recent month. The quoted prices of major manufactures have reached new high in recent years. The quoted prices of PetroChina Fushun Petrochemical Company and PetroChina Lanzhou Petrochemical Company reached 5,500 to 5,800 yuan per ton. Due to the low inventory in the market, the supply of traders is limited.
Comment: As the production equipment of some enterprises are under overhauls, the market inventory is relatively low. The MEK price may continue to surge in the future. Among listed companies, Zibo Qixiang Tengda Chemical Co., Ltd. (002408.SZ) owns an MEK capacity of 180,000 tons, accounting for nearly half of the domestic market share. Its 2015 annual report shows that the business contributes nearly 30 percent of its main businesses. The phase-I MEK equipment of Zhejiang Haiyue Co., Ltd. (600387.SH) with a capacity of 40,000 tons has been put into operation.
TOP
[Announcement Interpretation]
○ Guangyu Development to acquire property assets with RMB8.7 bln
------
Tianjin Guangyu Development Co., Ltd. (000537.SZ) proposes to acquire 34.5 percent, 65 percent, 100 percent and 100 percent equities of Chongqing Luneng, Yibin Luneng, Luneng Genfu and Shunxi Xincheng from its substantial shareholder and 30 percent equities of Chongqing Luneng Yingda held by the Century Hengmei with 8,729 million yuan by issuing shares at 6.81 yuan per share through private placement. Meanwhile, the company plans to raise a supporting fund of 8,729 million yuan by issuing shares at no less than 6.94 yuan per share.
Chongqing Luneng, Yibin Luneng, Luneng Genfu and Shunxi Xincheng are property development enterprises with the national Level-I development qualification while Chongqing Luneng Yingda is a property enterprise with the national Level-II development qualification. The State Grid Corporation of China became the actual controller of the company from 2008 and the transaction constitutes a backdoor listing.
○ Longzhou Transportation to acquire bitumen and logistics enterprise, connected parties to subscribe 90 pct
------
Fujian Longzhou Transportation Co., Ltd. (002682.SZ) intends to acquire 100 percent equities of Tianjin Zhaohua Leading Co., Ltd. with 1,242 million yuan by issuing shares at 12.06 yuan per share through private placement and in cash. Meanwhile, the company proposes to raise a supporting fund of 580 million yuan by issuing shares at 10.58 yuan per share through private placement. The controlling shareholder and the employee assets management plan of the company will invest 400 million yuan and 120 million yuan in the subscription.
Zhaohua Leading is principally engaged in bitumen logistics and trade and the processing of modified bitumen. Its committed net profits from 2016 to 2018 are 85 million yuan, 105 million yuan and 125 million yuan, respectively.
TOP
○ Ellassay Fashion to control IRO to advance high-end fashion strategy
------
Shenzhen Ellassay Fashion Co., Ltd. (603808.SH) plans to purchase 16 percent equities of Qianhai Shanglin. Ellassay Fashion will hold 65 percent equities of Qianhai Shanglin after the completion of the acquisition and indirectly control over companies with their IRO through Qianhai Shanglin. The "IRO" brand was established in 2004 and is positioned in the brand design in light luxury industry. It has entered the U.S., Germany, Denmark and South Korean. The acquisition is an important strategy in developing high-end fashion group in China by Ellassay Fashion.
○ Huasheng Tianlong Photoeletric sees actual controller changes
------
Beijing Lingguang Energy Investment Co., Ltd., a substantial shareholder of Jiangsu Huasheng Tianlong Photoeletric Co., Ltd. (300029.SZ) signed an equity transfer agreement with Chen Hua on July 18. Chen will acquire 50 percent equities of Lingguang Energy Investment with 100 million yuan and indirectly control 40,457,200 shares or 20.23 percent equities of the listed company, making him the new actual controller of the company. Chen is rosy about the prospects of the PV industry in the medium and long term and may continue increasing the shareholding in the following year.
○ Dong Yi Ri Sheng Home Decoration to expand intelligent logistics and storage through private placement
------
Dong Yi Ri Sheng Home Decoration Group Co., Ltd. (002713.SZ) plans to raise 700 million yuan by issuing 27.15 million shares at 25.78 yuan per share through private placement. The proceeds will be invested in the establishment of an intelligent logistics and storage management platform in the home decoration industry and an experiencing system for digital home decoration.
[Financial Reports Express]
○ Protruly Vision Technology expects performance growth
------
Jiangsu Protruly Vision Technology Group Co., Ltd. (600074.SH) expects an increase of 225 to 250 percent in the interim report thanks to the surging vehicle video businesses. Fangda Special Steel Technology Co., Ltd. (600507.SH) expects an increase of 75 percent in the interim report as a result of the bigger cost reduction than revenue decrease.
[Trading Trends]
○ Three institutional seats buy H＆T Intelligent Control
------
The trading volume ranking list on July 19 shows that three institutional seats bought Shenzhen H＆T Intelligent Control Co., Ltd. (002402.SZ) with a total of 149 million yuan, accounting for 34.74 percent of its intraday turnover.
Comment: The company recently announced the establishment of a research center with Shenzhen Academy of Aerospace Technology to be engaged in the technical development, products development, the transformation of technical results and the industrial operation of the ARM system chips and their application, the Internet of Things sensing technologies, the Internet of Things communications and networking technologies and the intelligent hardware for the Internet of Things. Institutes believe that the Soft Bank announced the acquisition of ARM with huge capitals. It meets the strategy of the company and enjoys a bright future.
[Trading Alarms]
○ Bank of Jiangsu to conduct IPO to July 20
------
Bank of Jiangsu Co., Ltd. (600919.SH) will issue shares at 6.27 yuan with an upper subscription limit of 346,000 shares for each account. The issuing price is equivalent to the current net asset per share with the corresponding P/E ratio of 7.64 times.
TOP
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