[Today's Guide]
○ Shanghai to comprehensively advance reform on classification of state-owned assets, accelerating SOE innovation and transformation
○ Nanjing Textiles Import ＆ Export likely restart reorganization, Nanjing state-owned assets reform to enter implementation stage
○ Prices of titanium dioxide goes up again, profitability of the industry increases following improvement of demand and supply
○ Blackcow Food to reorganize to facilitate transformation, Tongyu Heavy Industry proposes high share conversion and dividend
[SSN Focus]
○ Shanghai to comprehensively advance reform on classification of state-owned assets, accelerating SOE innovation and transformation
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Xinhua News Agency on August 2 published an article entitled "Shanghai State-owned Capital and SOE: Balance Control and Liberalization to Deepen Reform". The article pointed out that to transfer from managing enterprise to managing capital has become the main direction for the new round state-owned enterprise (SOE) reform. Shanghai Huayi Group injects core assets in to listed company to vigorously reduce the costs and strengthen main business; Shanghai INESA gives full play to the management team, and it has brought in talents, various technologies, market and teams by introducing capital; Shanghai SOE ETF has completed issuance recently, which has raised 15.22 billion yuan in the initial stage and become the largest equity fund product during the year. This could accelerate the flow of state-owned capital in an orderly way. Besides, head of the Shanghai State-owned Assets Supervision and Administration Commission of the State Council (SASAC) introduced that Shanghai will build non-performing assets disposal platform, to reinforce management of residual value by the force of the market.
TOP
○ Nanjing Textiles Import ＆ Export likely restart reorganization, Nanjing state-owned assets reform to enter implementation stage
------
Nanjing Textiles Import ＆ Export Corp., Ltd. (600250.SH) indicated in the latest announcement that its controlling shareholder is planning important matters related to the company, which may involve major assets reorganization. As a result, the company will suspend trading from August 3. After failed the reorganization with Nanjing Securities Co., Ltd. last year, Nanjing Textiles Import ＆ Export expressly indicated that it will actively seek new business and profit growth point, to improve the quality of assets and profitability.
Comment: Jiangsu is the first Chinese province that have issued SOE reform implementation rules. Nanjing, the capital city of Jiangsu, has also formulated Implementation Opinions on Deepening SOE Reform. The major path is strategic reorganization, transformation of business model, securitization of business assets and etc. Industry insiders revealed that controlling shareholders some listed companies have already submitted various reform plans, including assets reorganization, to Nanjing SASAC. Information shows that the controlling shareholderof Nanjing Chemical Fibre Co., Ltd. (600889.SH) and Nanjing Gaoke Company Limited (600064.SH) is also Nanjing SASAC. Nanjing Chemical Fibre sold Nanjing Jinling Real Estate Development Co., Ltd. last year, and is now actively seeking new opportunities in the reform, in order to enter new business sector at the right time.
[SSN Selection]
○ Last week, the margin of securities saw net capital inflow of 16.8 billion yuan, ending the previous capital outflow for five consecutive weeks.
○ In June, China's Sports lottery sales has increased by 47.2 percent year on year. In the first six months of the year, the sales has in aggregate increased by 8.4 percent year on year.
○ The Ministry of National Defense responded to Japan's release of 2016 Japanese Defence White Paper, criticizing Japan's intentions hype on South China Sea and East China Sea.
○ The Ministry of Industry and Information Technology (MIIT) recently held a symposium to coordinate and advance the development of new energy vehicle. The MIIT indicated that it will push forward the launch of Guidance on Promoting the Development of Auto Power Battery Industry.
○ China Petroleum ＆ Chemical decides to publically introduce capital with Piping Branch Office of Sichuan Natural Gas East Transportaion Company as the platform. Upon completion of the project, the company will hold 50 percent of the platform.
TOP
[Industry Information]
○ Prices of titanium dioxide goes up again, profitability of the industry increases following improvement of demand and supply
------
Data of Baichuan shows that Sichuan Lomon, the leading enterprise in the titanium dioxide industry, on August 2 again increase the prices of its products. To direct domestic customers, the price will be 500 yuan/ ton higher, and for international customers, the price hike will be 50 dollars/ton. It is the ninth time that the company increases price, and the growth in total exceeded 30 percent during the year.
Comment: recently environment investigation continues to progress and supply declined as the rate of operation of enterprises shrunk. In addition, the export market has maintained good momentum, and inventory of large factories is tense. Driven by the improvement of supply and demand, the profitability of the industry is expected to continue to improve. Henan Billions Chemicals Co., Ltd. (002601.SZ) has obtained the approval from China Securities Regulatory Commission (CSRC) for the acquisition of Sichuan Lomon through private placement. The company's latest announcement said that it will rise the sales price of redstone type titanium dioxide; CNNC Hua Yuan Titanium Dioxide Co., Ltd. (002145.SZ), Jilin Gpro Titanium Industry Co., Ltd. (000545.SZ) and Shanghai Anoky Group Co., ltd. (002136.SZ) also have titanium pigment production capacity.
TOP
[Announcement Interpretation]
○ Blackcow Food to split off food and beverage business to facilitate transformation
------
Blackcow Food Company Limited (002387.SZ) plans to sell 100 percent equities of Blackcow Industry Co., Ltd., Jieyang Blackcow Co., Ltd., Anhui Blackcow Co., Ltd., Guangzhou Blackcow Co., Ltd. and Blackcow Marketing Co., Ltd to Blackcow Asset Management Co., Ltd. for 513 million yuan. The latter will pay consideration in cash. The company will split off its food and beverage business to focus on software and information technology service after the deal. Meanwhile, the company will gain large amount of cash from the deal to provide sufficient liquidity for its transformation.
○ Huachangda Intelligent Equipment raises nearly RMB 2.4bln to develop intelligent manufacturing
------
Hubei Huachangda Intelligent Equipment Co., Ltd. (300278.SZ) plans to raise about 2,385 million yuan by issuing 149 million yuan shares through private placement. The proceeds will be used for the research and development of high-end smart robots for various fields, the construction of military sector, the research and development center for intelligent transport automation equipment and the intelligent robotics equipment for new energy vehicles and to acquire 51 percent equities of Hi-Key Technology Co., Ltd. The benchmark pricing date is its first issuance day.
Comment: Currently, most of the company's intelligent products are used in automotive production. The private placement will help the company expand to the military and other non-automotive sectors to add a new growth point.
○ Fujian Funeng sees lower cost in natural gas to improve its EPS
------
Jinjiang Natural Gas Development Co., Ltd., the stake-controlling subsidiary of Fujian Funeng Co., Ltd. (600483.SH), was notified by Fujian Provincial Price Bureau that the price of natural gas sold at CNOOC stations reduced from 62.1778 yuan per GJ to 54.2124 yuan per GJ. According to production budget, Jinjiang Natural Gas Development will purchase 200,700 tons of natural gas. It is expected that the company will reduce 77.68 million yuan cost in electricity generation and improve 0.05 yuan earnings per share.
[Financial Express]
○ Tongyu Heavy Industry proposes high share conversion and dividend
------
Tongyu Heavy Industry Co., Ltd. (300185.SZ) reported a growth of 44 percent in earnings in its semi-annually report. The company's board of directors passed its distribution plan of a 20-for-10 conversion of capital surplus into shares combined with 0.3 yuan dividend for every 10 shares.
○ Sinnet Tech. reports H1 earnings to surge
------
Beijing Sinnet Technology Co., Ltd. (300383.SZ) reported a growth of 184 percent in earnings in its semi-annually report. Shenzhen Comix Group Co., Ltd. (002301.SZ) reported a growth of 334 percent in earnings in its semi-annually report. Xuzhou Wuyang Technology Co., Ltd. (300420.SZ) reported a growth of 223 percent in earnings in its semi-annually report.
[Trading Trends]
○ Institutions invest in new energy vehicles in market adjustment
------
SSN learnt that the new energy vehicle sector is attracting investment from some private and public funds. A fund manager from a well-known public fund based in Shanghai that although some new energy vehicle stocks record high growth in the short term, the industry is in the initial stage and still has a huge market potential.
It is learnt that institutions have been building up positions in electrolyte, wet-laying membrane and ternary materials with high barriers, and in cobalt metal whose prices are rising on increasing demands. Based on the recommendations in the seller's research report, institutions put most focus on companies that have newly entered the high barrier field. Beijing Sojo Electric Co., Ltd. (300444.SZ) bought additional shares in Beijing DG Membrane Technology Co., Ltd., for second times. The latter is mainly engaged in wet-laying ceramic membrane, and will ascend among top three in the industry after it reaches its designed production. It is expected to substitute with imported projects. Guangdong Tonze Electric Co., Ltd. (002759.SZ) proposes to acquire Jiangsu Xintai Material Co., Ltd by issuing shares through private placement. The latter ranks fifth in the industry in terms of lithium phosphate productivity, and is expected to become a leader in the industry after it reaches its designed production. Various institutions are also bullish abut the company.
[Trading Alarms]
○ Guangxi Radio ＆ TV Network and Suzhou Goldengreen Technologies to launch IPOs on Aug. 3
------
Guangxi Radio ＆ TV Network Co., Ltd. (730936) will offer shares at 4.8 yuan per share with an upper limit of 9,0000 shares for each applicant. The company's PE ratio is 23 times. The company is engaged in telecommunication, broadcasting and satellite transmission services. Suzhou Goldengreen Technologies Ltd. (300060.SZ) suspended the IPO subscription scheduled on Aug. 2 due to the bad weather, and resume subscription on Aug. 3. The company will shares at 7.71 yuan per share with an upper limit of 12,0000 shares for each applicant. The company's PE ratio is 23 times. The company is mainly engaged in laser organic photosensitive drum.
TOP
○ Shanghai to comprehensively advance reform on classification of state-owned assets, accelerating SOE innovation and transformation
○ Nanjing Textiles Import ＆ Export likely restart reorganization, Nanjing state-owned assets reform to enter implementation stage
○ Prices of titanium dioxide goes up again, profitability of the industry increases following improvement of demand and supply
○ Blackcow Food to reorganize to facilitate transformation, Tongyu Heavy Industry proposes high share conversion and dividend
[SSN Focus]
○ Shanghai to comprehensively advance reform on classification of state-owned assets, accelerating SOE innovation and transformation
------
Xinhua News Agency on August 2 published an article entitled "Shanghai State-owned Capital and SOE: Balance Control and Liberalization to Deepen Reform". The article pointed out that to transfer from managing enterprise to managing capital has become the main direction for the new round state-owned enterprise (SOE) reform. Shanghai Huayi Group injects core assets in to listed company to vigorously reduce the costs and strengthen main business; Shanghai INESA gives full play to the management team, and it has brought in talents, various technologies, market and teams by introducing capital; Shanghai SOE ETF has completed issuance recently, which has raised 15.22 billion yuan in the initial stage and become the largest equity fund product during the year. This could accelerate the flow of state-owned capital in an orderly way. Besides, head of the Shanghai State-owned Assets Supervision and Administration Commission of the State Council (SASAC) introduced that Shanghai will build non-performing assets disposal platform, to reinforce management of residual value by the force of the market.
TOP
○ Nanjing Textiles Import ＆ Export likely restart reorganization, Nanjing state-owned assets reform to enter implementation stage
------
Nanjing Textiles Import ＆ Export Corp., Ltd. (600250.SH) indicated in the latest announcement that its controlling shareholder is planning important matters related to the company, which may involve major assets reorganization. As a result, the company will suspend trading from August 3. After failed the reorganization with Nanjing Securities Co., Ltd. last year, Nanjing Textiles Import ＆ Export expressly indicated that it will actively seek new business and profit growth point, to improve the quality of assets and profitability.
Comment: Jiangsu is the first Chinese province that have issued SOE reform implementation rules. Nanjing, the capital city of Jiangsu, has also formulated Implementation Opinions on Deepening SOE Reform. The major path is strategic reorganization, transformation of business model, securitization of business assets and etc. Industry insiders revealed that controlling shareholders some listed companies have already submitted various reform plans, including assets reorganization, to Nanjing SASAC. Information shows that the controlling shareholderof Nanjing Chemical Fibre Co., Ltd. (600889.SH) and Nanjing Gaoke Company Limited (600064.SH) is also Nanjing SASAC. Nanjing Chemical Fibre sold Nanjing Jinling Real Estate Development Co., Ltd. last year, and is now actively seeking new opportunities in the reform, in order to enter new business sector at the right time.
[SSN Selection]
○ Last week, the margin of securities saw net capital inflow of 16.8 billion yuan, ending the previous capital outflow for five consecutive weeks.
○ In June, China's Sports lottery sales has increased by 47.2 percent year on year. In the first six months of the year, the sales has in aggregate increased by 8.4 percent year on year.
○ The Ministry of National Defense responded to Japan's release of 2016 Japanese Defence White Paper, criticizing Japan's intentions hype on South China Sea and East China Sea.
○ The Ministry of Industry and Information Technology (MIIT) recently held a symposium to coordinate and advance the development of new energy vehicle. The MIIT indicated that it will push forward the launch of Guidance on Promoting the Development of Auto Power Battery Industry.
○ China Petroleum ＆ Chemical decides to publically introduce capital with Piping Branch Office of Sichuan Natural Gas East Transportaion Company as the platform. Upon completion of the project, the company will hold 50 percent of the platform.
TOP
[Industry Information]
○ Prices of titanium dioxide goes up again, profitability of the industry increases following improvement of demand and supply
------
Data of Baichuan shows that Sichuan Lomon, the leading enterprise in the titanium dioxide industry, on August 2 again increase the prices of its products. To direct domestic customers, the price will be 500 yuan/ ton higher, and for international customers, the price hike will be 50 dollars/ton. It is the ninth time that the company increases price, and the growth in total exceeded 30 percent during the year.
Comment: recently environment investigation continues to progress and supply declined as the rate of operation of enterprises shrunk. In addition, the export market has maintained good momentum, and inventory of large factories is tense. Driven by the improvement of supply and demand, the profitability of the industry is expected to continue to improve. Henan Billions Chemicals Co., Ltd. (002601.SZ) has obtained the approval from China Securities Regulatory Commission (CSRC) for the acquisition of Sichuan Lomon through private placement. The company's latest announcement said that it will rise the sales price of redstone type titanium dioxide; CNNC Hua Yuan Titanium Dioxide Co., Ltd. (002145.SZ), Jilin Gpro Titanium Industry Co., Ltd. (000545.SZ) and Shanghai Anoky Group Co., ltd. (002136.SZ) also have titanium pigment production capacity.
TOP
[Announcement Interpretation]
○ Blackcow Food to split off food and beverage business to facilitate transformation
------
Blackcow Food Company Limited (002387.SZ) plans to sell 100 percent equities of Blackcow Industry Co., Ltd., Jieyang Blackcow Co., Ltd., Anhui Blackcow Co., Ltd., Guangzhou Blackcow Co., Ltd. and Blackcow Marketing Co., Ltd to Blackcow Asset Management Co., Ltd. for 513 million yuan. The latter will pay consideration in cash. The company will split off its food and beverage business to focus on software and information technology service after the deal. Meanwhile, the company will gain large amount of cash from the deal to provide sufficient liquidity for its transformation.
○ Huachangda Intelligent Equipment raises nearly RMB 2.4bln to develop intelligent manufacturing
------
Hubei Huachangda Intelligent Equipment Co., Ltd. (300278.SZ) plans to raise about 2,385 million yuan by issuing 149 million yuan shares through private placement. The proceeds will be used for the research and development of high-end smart robots for various fields, the construction of military sector, the research and development center for intelligent transport automation equipment and the intelligent robotics equipment for new energy vehicles and to acquire 51 percent equities of Hi-Key Technology Co., Ltd. The benchmark pricing date is its first issuance day.
Comment: Currently, most of the company's intelligent products are used in automotive production. The private placement will help the company expand to the military and other non-automotive sectors to add a new growth point.
○ Fujian Funeng sees lower cost in natural gas to improve its EPS
------
Jinjiang Natural Gas Development Co., Ltd., the stake-controlling subsidiary of Fujian Funeng Co., Ltd. (600483.SH), was notified by Fujian Provincial Price Bureau that the price of natural gas sold at CNOOC stations reduced from 62.1778 yuan per GJ to 54.2124 yuan per GJ. According to production budget, Jinjiang Natural Gas Development will purchase 200,700 tons of natural gas. It is expected that the company will reduce 77.68 million yuan cost in electricity generation and improve 0.05 yuan earnings per share.
[Financial Express]
○ Tongyu Heavy Industry proposes high share conversion and dividend
------
Tongyu Heavy Industry Co., Ltd. (300185.SZ) reported a growth of 44 percent in earnings in its semi-annually report. The company's board of directors passed its distribution plan of a 20-for-10 conversion of capital surplus into shares combined with 0.3 yuan dividend for every 10 shares.
○ Sinnet Tech. reports H1 earnings to surge
------
Beijing Sinnet Technology Co., Ltd. (300383.SZ) reported a growth of 184 percent in earnings in its semi-annually report. Shenzhen Comix Group Co., Ltd. (002301.SZ) reported a growth of 334 percent in earnings in its semi-annually report. Xuzhou Wuyang Technology Co., Ltd. (300420.SZ) reported a growth of 223 percent in earnings in its semi-annually report.
[Trading Trends]
○ Institutions invest in new energy vehicles in market adjustment
------
SSN learnt that the new energy vehicle sector is attracting investment from some private and public funds. A fund manager from a well-known public fund based in Shanghai that although some new energy vehicle stocks record high growth in the short term, the industry is in the initial stage and still has a huge market potential.
It is learnt that institutions have been building up positions in electrolyte, wet-laying membrane and ternary materials with high barriers, and in cobalt metal whose prices are rising on increasing demands. Based on the recommendations in the seller's research report, institutions put most focus on companies that have newly entered the high barrier field. Beijing Sojo Electric Co., Ltd. (300444.SZ) bought additional shares in Beijing DG Membrane Technology Co., Ltd., for second times. The latter is mainly engaged in wet-laying ceramic membrane, and will ascend among top three in the industry after it reaches its designed production. It is expected to substitute with imported projects. Guangdong Tonze Electric Co., Ltd. (002759.SZ) proposes to acquire Jiangsu Xintai Material Co., Ltd by issuing shares through private placement. The latter ranks fifth in the industry in terms of lithium phosphate productivity, and is expected to become a leader in the industry after it reaches its designed production. Various institutions are also bullish abut the company.
[Trading Alarms]
○ Guangxi Radio ＆ TV Network and Suzhou Goldengreen Technologies to launch IPOs on Aug. 3
------
Guangxi Radio ＆ TV Network Co., Ltd. (730936) will offer shares at 4.8 yuan per share with an upper limit of 9,0000 shares for each applicant. The company's PE ratio is 23 times. The company is engaged in telecommunication, broadcasting and satellite transmission services. Suzhou Goldengreen Technologies Ltd. (300060.SZ) suspended the IPO subscription scheduled on Aug. 2 due to the bad weather, and resume subscription on Aug. 3. The company will shares at 7.71 yuan per share with an upper limit of 12,0000 shares for each applicant. The company's PE ratio is 23 times. The company is mainly engaged in laser organic photosensitive drum.
TOP
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