[Today's Guide]
○ 19 cities roll out regulations over housing market, aiming to prevent and control financial risks
○ Production reduction pushes up oil price, oilfield services sector in Hong Kong largely surges
○Jianfeng Chemical to acquire Chongqing Phar., Baoshan Iron ＆ Steel to exchange shares with Wuhan Iron and Steel for merging
○ Rightway Real Estate Development to acquire controlling right of Guodong Construction at price with premium, Kelin Environmental Protection Equipment to alter actual controller
[SSN Focus]
○ 19 cities roll out regulations over housing market, aiming to prevent and control financial risks
------
19 cities have rolled out tougher regulations in the housing markets around the National Day Holiday in a bid to stabilize housing price. For example, Shenzhen residents are only allowed to purchase two houses and need to pay a down payment of 70 percent for the second house. Housing transaction significantly declines in multiple cities at the sound of restriction. Zhou Xiaochuan, governor of the People's Bank of China, indicated on IMF ministerial meeting held on Oct. 6 that the rapidly surging housing price in some cities in China have attracted great attention of Chinese government. Measures will be taken to promote healthy development of the real estate market.
Comment: According to SSN statistics, the measures taken in the aforesaid 19 cities are much tougher when compared with those rolled out in 2011. The respondents indicated that preliminary results are achieved after the central government made a series of arrangement aiming to curb the rapid and excessive rises in housing prices. The regulations target at curbing asset bubbles, preventing and controlling financial risks, and guiding more capital to enter the real economy.
○ NDRC holds special meeting on mixed ownership reform in SOEs, mixed ownership reform of military industry to accelerate
------
The National Development and Reform Commission (NDRC) recently held a special meeting to arrange work related to the piloting of mixed ownership reform in state-owned enterprises (SOEs), requiring solving problems as soon as possible and moving faster in summarizing reform experiences. Explanations about the piloting in key areas were made, and detailed introduction about the implementation scheme for the mixed ownership reform in the first batch of piloting central SOEs, including China Eastern Airlines Co., Ltd. and China United Network Communications Group Co., Ltd., were made. China United Network Communications Limited (600050.SH) recently announced that the company is studying on the implementation scheme for the reform, and it is still uncertain about whether the group will be covered in the first batch.
Comment: The State Administration of Science, Technology and Industry for National Defense and some military enterprises are also involved in the meeting, meaning that the mixed ownership reform in the military area might be accelerated. The opening in the military area was usually translated into civil-military integration in products in the past, but in the future, the opening might be done through equity investment and social capital might be allowed to get involved. Guotai Junan Securities believes that the reform in the military industry might beat market expectation. Multiple institutions are quite rosy about the advancing of major reform measures, including the reform of military-related institutes and the accelerated asset securitization.
[SSN Selection]
○ The executive meeting of the State Council held on Oct. 8 determined investment projects receiving further simplification of government approval, helping to promote market players to expand reasonable and effective investment.
○ Shanghai Stock Exchange has released and implemented the guidance on changing the stock abbreviation of listed companies, meaning that listed companies will not be allowed to change stock abbreviation at will.
○ Shenzhen Stock Exchange has further revised and improved the eight business rules related to Shenzhen-Hong Kong Stock Connect with more risk warning added.
○ Three departments issued notice about properly increasing the release of advanced coal capacity. Qualified coal mines might free from the limit of 276 working days before end 2016.
○ The discovery about cell 'self-eating' mechanism was awarded 2016 Nobel Prize in medicine. The studies might be used to cure cancer and aging.
○ The Nasdaq index and Hang Seng Index moved up 0.44 percent and 2.38 percent, respectively, during the 7-day National Day Holiday. China Evergrande Group (03333.HK) totally surged 6.87 percent after it was confirmed to purchase the shell resource of Shenzhen Special Economic Zone Real Estate ＆ Properties (Group) Co., Ltd. (000029.SZ).
TOP
[Industry Information]
○ Production reduction pushes up oil price, oilfield services sector in Hong Kong largely surges
------
International oil price moves up over 3 percent in recent week and once rose above 50 US dollars per barrel. OPEC held a special meeting on Sept. 28, deciding to reduce current daily oil output to 32.5 million-33.0 million barrels. Algeria's Oil Minister recently commented that the production reduction announced by OPEC is not big enough to maintain oil price above 50 US dollars per barrel, and the minister expected that the meeting to be held in Vienna in November might announce bigger reduction. During the National Day Holiday, the oilfield services sector in Hong Kong largely surged with Sinopec Oilfield Service Corporation (01033.HK) surging 11 percent and China Oilfield Services Limited (02883.HK) surging 15 percent.
Comment: Institutions believe that the continuing agreement to freeze production and the hurricanes in the North America might further support the rebound of oil price. The surging oil price might drive up the capital expenditure of oil companies and improve the orders of companies engaged in oilfield services. As to listed companies, Sichuan Renzhi Oilfield Technology Services Co., Ltd. (002629.SZ) is a service provider for drilling fluid technology; GI Technologies (Beijing) Co., Ltd. (300309.SZ) is principally engaged in oil well logging instruments; Landocean Group Limited (300157.SZ) is mainly involved in technology services for the exploitation of oil and gas resources.
○ Roadmap for intelligent vehicles to release, standards formulated to boost industrial development
------
As reported on caixin.com, the Ministry of Industry and Information Technology (MIIT) might unveil the technology roadmap for the development of intelligent vehicles in China in end October. According to the roadmap, China's way to realize automatic driving will be divided into four stages. High-degree or complete automatic driving might be realized in 2025 or in longer time. It is proposed that driving assistance functions, with self-adaptive cruise control, automatic emergency braking and assisted parking included, will be realized during 2016-2017.
Comment: The 3rd Generation Partnership Project (3GPP) recently announced that the first version of standards for the Internet of vehicles (vehicle-to-infrastructure) has been formulated, helping to boost the development of the industrial chain of the Internet of vehicles and automatic driving. Industrial Securities expects that mature products based on LTE-V standards will be produced in 2017 and official commercial use will come in 2018. Datang Telecom Technology Co., Ltd. (600198.SH) is a provider engaged in LTE-V chips and solutions; the terminal products for the Internet of vehicles produced by Guangdong Shenglu Telecommunication Tech. Co., Ltd. (002446.SZ) develop rapidly, and the company actively makes arrangement in products like infrared night-vision system and ADAS system.
TOP
[Announcement Interpretation]
○ Jianfeng Chemical to acquire Chongqing Phar. with RMB6.7 bln
------
Chongqing Jianfeng Chemical Co., Ltd. (000950.SZ) proposes to sell all assets and debts, except 7,069,000 restricted shares of Donlinks International Investment Co., Ltd. (000893.SZ) held by the company, to its controlling shareholder Jianfeng Group. The assets and debts being proposed to be sold are estimated to total 1.487 billion yuan. Meanwhile, the company proposes to acquire 96.59 percent equities of Chongqing Pharmaceutical (Group) Co., Ltd. held by several shareholders by issuing shares at 5.93 yuan per share through private placement. The transaction is primarily set at 6.698 billion yuan. According to performance commitment, the net profit of Chongqing Pharmaceutical during the 2016-2018 period should reach 450 million yuan, 549 million yuan and 620 million yuan, respectively.
Comment: Since the State-owned Assets Supervision and Administration Commission of Chongqing Municipality will remain as the actual controller of the company after the reorganization, so the transaction means no back-door listing. After the reorganization, Jianfeng Chemical is able to exchange out chemical assets with weak profitability, inject quality medicine assets and protect its shell resource.
○Baoshan Iron ＆ Steel to exchange shares with Wuhan Iron and Steel for merging
------
Baoshan Iron ＆ Steel Co., Ltd. (600019.SH) proposes to issue A shares to all stock-for-stock shareholders of Wuhan Iron and Steel Company Limited (600005.SH), and implement the merging. The stock-for-stock prices of the two listed companies are 4.6 yuan per share and 2.58 yuan per share respectively, thus, the determined stock-for-stock proportion is that one share of Wuhan Iron and Steel can be exchanged for 0.56 share of Baoshan Iron ＆ Steel. Based on calculation, the equity will total at 22.1 billion shares roughly after merging, and the total assets reached 362.1 billion yuan at the end of this June, with revenue of 106.8 billion yuan and gross profit rate of 12.29 percent for the first half year. The two companies has suspended their trading since June 27, and the stock prices before that were 4.9 yuan and 2.76 yuan respectively.
TOP
○Rightway Real Estate Development to acquire controlling right of Guodong Construction at price with premium of 70 pct
------
Sichuan Guodong Construction Group Co., Ltd., substantial shareholder of Sichuan Guodong Construction Co., Ltd. (600321.SH), plans to transfer its held 358 million shares to Rightway Real Estate Development Co., Ltd. at 7 yuan per share, which has a premium of 74 percent compared to the latest stock price of 4.02 yuan per share before trading suspension. Rightway Real Estate Development will hold 23.7 percent of the equities after transfer, and the shareholding proportion of Guodong Construction Group will cut to 21.82 percent from 45.53 percent. The equities held by the two groups are close. However, Guodong Construction Group has promised not to search for the controlling right of the listed company through any ways.
Comment: Guodong Construction previously suspended its trading to plan backdoor listing for Rightway Real Estate Development, and proposed to swap all its assets and liabilities to invest in real estate business of the latter. But due to factors including new restructuring rules, the listed company announced to stop the restructuring. This time, although it resumes its trading without successful restructuring, investment from Rightway Real Estate Development also leave some space for the listed company's next-step capital operation. Based on announcement, Rightway Real Estate Development has registered in Dalian city, with registered capital of 7.95 billion yuan.
○ Kelin Environmental Protection Equipment to alter actual controller
------
Six shareholders, such as Song Qidi and his held Jiangsu Kelin Group Co., Ltd., which is the actual controller of Kelin Environmental Protection Equipment, Inc. (002499.SZ), Xu Tianping and others, plan to transfer 19 percent equities of the listed company to Chongqing Dongcheng Ruiye Investment Co., Ltd., and meanwhile, voting right of additional 9 percent equities also to Dongcheng Ruiye Investment (this part of 9 percent will also be transferred in the future). Dongcheng Ruiye Investment will hold 28 percent equities of the listed company after successful transactions to become the largest shareholder, and the actual controller of the listed company will also alter.
Comment: Dongcheng Ruiye Investment is mainly engaged in project investment, with Tibet Zhihan Energy Development Co. Ltd. as its controlling shareholder, and Ni Dong holds 90 percent equities of the latter as the actual controller. The scheme and price of this transaction have not been finally determined yet.
○ Invengo Information Technology to add investment in Internet of Things
------
Invengo Information Technology Co., Ltd. (002161.SZ) plans to raise 745 million yuan through private placement of 62.75 million shares at a price no less than 11.87 yuan per share, which will be used to invest in car networking application of RFID, technical application of Internet of Things in the intelligent tourism industry, application of Internet of Things in retail field, and etc. Chen Guangzhu, chairman and actual controller of the listed company, commits to subscribe 30 percent of the private placement.
○ Shares of Yongan Pharmaceutical and Sihuan Bioengineering bought to placard threshold of 5 pct
------
Shenzhen Shangyuan Capital, shareholder of Qianjiang Yongan Pharmaceutical Co., Ltd. (002365.SZ), bought 0.84 million shares of the listed company on Sep. 30, and after this, the former holds 18.71 shares, accounting for 10 percent. China Medium ＆ Small Companies Investment Co., Ltd., shareholder of Jiangsu Sihuan Bioengineering Co., Ltd. (000518.SZ), on Sep. 30 increased 110,000 shareholdings in the listed company, and it holds 51.50 million shares now, taking up 5 percent, which makes it as the second largest shareholder.
○ Jianmin Pharmaceutical to carry out private placement and expand production, employee shareholding plan to subscribe private placement
------
Jianmin Pharmaceutical Group Co., Ltd. (600976.SH) plans to raise 1.14 billion yuan through private placement of 45.29 million shares at 25.17 yuan per share to its controlling shareholder Holley Group, Zhou Jingchun, Sailing Capital International (Shanghai) Co., Ltd., core employee shareholding plan and others. All raised fund will be used for construction, production expansion and upgrading of intelligent manufacturing base to expand the medicine capacity. The project construction period is four years. Annual sales revenue may reach 2.4 billion yuan after full production, with average profit of around 230 million yuan annually.
○ Perfect World Co., Ltd. (002624.SZ) plans to acquire 100 equities of Antaeus Movie Theatres, Antaeus Film Studio and Antaeus Culture with around 1.35 billion yuan. Zhejiang Century Huatong Group Co., Ltd. (002602.SZ) plans to 100 equities of game company's DianDian Interactive Holding and DianDian Beijing respectively with 6,939 million yuan.
[Financial Reports Express]
○ North Huajin Chemical Industries and others predict growth
------
North Huajin Chemical Industries Co., Ltd. (000059.SZ) predicts a growth of 15.9 to 16.6 times for the first three quarters, mainly due to greatly-reduced costs; growth forecast of 460 percent to 490 percent for Beijing Watertek Information Technology Co., Ltd. (300324.SZ), mainly due to merging financial statements with Xi'an Xigu Micro-electronics Co., Ltd.; growth forecast of 170 percent to 210 percent for Ningbo Boway Alloy Material Co., Ltd. (601137.SH), mainly due to growth of new products sales.
Wenzhou Hongfeng Electrical Alloy Co., Ltd. (300283.SZ) forecasts a growth of 160 percent to 190 percent for the first three quarters, mainly due to growth in revenue and stock silver price; forecast growth of 130 percent to 146 percent for Chongqing Sokon Industry Group Co., Ltd. (601127.SH), mainly due to great growth in product sales; forecast growth of 148 percent to 174 percent for Shenzhen V＆T Technologies Co., Ltd. (300484.SZ), mainly due to great sales growth in machine controller of e-cars.
[Trading Alarms]
○ SSE releases 3Q report disclosure timetable
------
Hangzhou Hangyang Co., Ltd. (002430.SZ), Kelin Environmental Protection Equipment, Inc. (002499.SZ), Kingnet Network Co., Ltd. (002517.SZ) and Brother Enterprises Holding Co., Ltd. (002562.SZ) on the SME Board, with Songcheng Performance Development Co., Ltd. (300144.SZ) and Tianjin Pengling Rubber Hose Co., Ltd. (300375.SZ) on the ChiNext Board will be the first movers to disclose the third quarterly report on Oct. 11. The first wave of four companies listed on the Main Board of Shenzhen Stock Exchange (SSE) will disclose financial reports on Oct. 18.
○ Jizhi Mechatronic to issue new shares on Oct. 10
------
Hangzhou Jizhi Mechatronic Co., Ltd. (300553.SZ) will issue new shares at 14.08 yuan per share, with a P/E ratio of 22.99 times and upper subscription limit of 120,000 shares. It is mainly engaged in fully-automatic balancing machine.
[Weekly Review]
○ Key factor to master market trend
------
There is always a section of notes repeated in music to set emotional tone for the whole chapter. There is always a certain factor to repeatedly play a role in market trend to guide the rises and falls. During this National Holiday, international oil price soared, gold price plummeted, and key factor becomes increasingly clear.
Crude oil had consecutively dropped in the previous years, and hit from shale oil and gas is the main factor. But since this year, main oil producing nations have held production frozen meetings for times, and will hold conference to guarantee the implementation. Driven by this, the oil price has recovered, closing to a new high within 2016.
Gold has performed well in the first half year, as many countries constantly expand the QE program, or even carry out negative interest rates. But in the G20 meeting during September, countries reached the agreement that they should reinforce the fiscal policies and not rely too much on monetary policies, and the following decisions of central banks also prove this. Therefore, the gold price suddenly falls. Whether to stop monetary policies is the core factor to cause this round of fluctuation in gold market.
In terms of A shares finally, the dramatic fluctuation last year was caused by leverage, no matter rise or fall. However, "intensifying the supervision" has become the most obvious feature since this year. Stock-price manipulation and restructuring for backdoor listing are both hit by constant supervisions. The large-cap indexes do not fluctuate too much, but the hot wave of short-term conceptual themes obviously weakens. Themes with substantial changes in fundamentals marked by performance growth, controlling right alteration and others start to perform well. Investors are better to adapt such trend, and search for investment opportunities without breaking the regulatory rules.
TOP
○ 19 cities roll out regulations over housing market, aiming to prevent and control financial risks
○ Production reduction pushes up oil price, oilfield services sector in Hong Kong largely surges
○Jianfeng Chemical to acquire Chongqing Phar., Baoshan Iron ＆ Steel to exchange shares with Wuhan Iron and Steel for merging
○ Rightway Real Estate Development to acquire controlling right of Guodong Construction at price with premium, Kelin Environmental Protection Equipment to alter actual controller
[SSN Focus]
○ 19 cities roll out regulations over housing market, aiming to prevent and control financial risks
------
19 cities have rolled out tougher regulations in the housing markets around the National Day Holiday in a bid to stabilize housing price. For example, Shenzhen residents are only allowed to purchase two houses and need to pay a down payment of 70 percent for the second house. Housing transaction significantly declines in multiple cities at the sound of restriction. Zhou Xiaochuan, governor of the People's Bank of China, indicated on IMF ministerial meeting held on Oct. 6 that the rapidly surging housing price in some cities in China have attracted great attention of Chinese government. Measures will be taken to promote healthy development of the real estate market.
Comment: According to SSN statistics, the measures taken in the aforesaid 19 cities are much tougher when compared with those rolled out in 2011. The respondents indicated that preliminary results are achieved after the central government made a series of arrangement aiming to curb the rapid and excessive rises in housing prices. The regulations target at curbing asset bubbles, preventing and controlling financial risks, and guiding more capital to enter the real economy.
○ NDRC holds special meeting on mixed ownership reform in SOEs, mixed ownership reform of military industry to accelerate
------
The National Development and Reform Commission (NDRC) recently held a special meeting to arrange work related to the piloting of mixed ownership reform in state-owned enterprises (SOEs), requiring solving problems as soon as possible and moving faster in summarizing reform experiences. Explanations about the piloting in key areas were made, and detailed introduction about the implementation scheme for the mixed ownership reform in the first batch of piloting central SOEs, including China Eastern Airlines Co., Ltd. and China United Network Communications Group Co., Ltd., were made. China United Network Communications Limited (600050.SH) recently announced that the company is studying on the implementation scheme for the reform, and it is still uncertain about whether the group will be covered in the first batch.
Comment: The State Administration of Science, Technology and Industry for National Defense and some military enterprises are also involved in the meeting, meaning that the mixed ownership reform in the military area might be accelerated. The opening in the military area was usually translated into civil-military integration in products in the past, but in the future, the opening might be done through equity investment and social capital might be allowed to get involved. Guotai Junan Securities believes that the reform in the military industry might beat market expectation. Multiple institutions are quite rosy about the advancing of major reform measures, including the reform of military-related institutes and the accelerated asset securitization.
[SSN Selection]
○ The executive meeting of the State Council held on Oct. 8 determined investment projects receiving further simplification of government approval, helping to promote market players to expand reasonable and effective investment.
○ Shanghai Stock Exchange has released and implemented the guidance on changing the stock abbreviation of listed companies, meaning that listed companies will not be allowed to change stock abbreviation at will.
○ Shenzhen Stock Exchange has further revised and improved the eight business rules related to Shenzhen-Hong Kong Stock Connect with more risk warning added.
○ Three departments issued notice about properly increasing the release of advanced coal capacity. Qualified coal mines might free from the limit of 276 working days before end 2016.
○ The discovery about cell 'self-eating' mechanism was awarded 2016 Nobel Prize in medicine. The studies might be used to cure cancer and aging.
○ The Nasdaq index and Hang Seng Index moved up 0.44 percent and 2.38 percent, respectively, during the 7-day National Day Holiday. China Evergrande Group (03333.HK) totally surged 6.87 percent after it was confirmed to purchase the shell resource of Shenzhen Special Economic Zone Real Estate ＆ Properties (Group) Co., Ltd. (000029.SZ).
TOP
[Industry Information]
○ Production reduction pushes up oil price, oilfield services sector in Hong Kong largely surges
------
International oil price moves up over 3 percent in recent week and once rose above 50 US dollars per barrel. OPEC held a special meeting on Sept. 28, deciding to reduce current daily oil output to 32.5 million-33.0 million barrels. Algeria's Oil Minister recently commented that the production reduction announced by OPEC is not big enough to maintain oil price above 50 US dollars per barrel, and the minister expected that the meeting to be held in Vienna in November might announce bigger reduction. During the National Day Holiday, the oilfield services sector in Hong Kong largely surged with Sinopec Oilfield Service Corporation (01033.HK) surging 11 percent and China Oilfield Services Limited (02883.HK) surging 15 percent.
Comment: Institutions believe that the continuing agreement to freeze production and the hurricanes in the North America might further support the rebound of oil price. The surging oil price might drive up the capital expenditure of oil companies and improve the orders of companies engaged in oilfield services. As to listed companies, Sichuan Renzhi Oilfield Technology Services Co., Ltd. (002629.SZ) is a service provider for drilling fluid technology; GI Technologies (Beijing) Co., Ltd. (300309.SZ) is principally engaged in oil well logging instruments; Landocean Group Limited (300157.SZ) is mainly involved in technology services for the exploitation of oil and gas resources.
○ Roadmap for intelligent vehicles to release, standards formulated to boost industrial development
------
As reported on caixin.com, the Ministry of Industry and Information Technology (MIIT) might unveil the technology roadmap for the development of intelligent vehicles in China in end October. According to the roadmap, China's way to realize automatic driving will be divided into four stages. High-degree or complete automatic driving might be realized in 2025 or in longer time. It is proposed that driving assistance functions, with self-adaptive cruise control, automatic emergency braking and assisted parking included, will be realized during 2016-2017.
Comment: The 3rd Generation Partnership Project (3GPP) recently announced that the first version of standards for the Internet of vehicles (vehicle-to-infrastructure) has been formulated, helping to boost the development of the industrial chain of the Internet of vehicles and automatic driving. Industrial Securities expects that mature products based on LTE-V standards will be produced in 2017 and official commercial use will come in 2018. Datang Telecom Technology Co., Ltd. (600198.SH) is a provider engaged in LTE-V chips and solutions; the terminal products for the Internet of vehicles produced by Guangdong Shenglu Telecommunication Tech. Co., Ltd. (002446.SZ) develop rapidly, and the company actively makes arrangement in products like infrared night-vision system and ADAS system.
TOP
[Announcement Interpretation]
○ Jianfeng Chemical to acquire Chongqing Phar. with RMB6.7 bln
------
Chongqing Jianfeng Chemical Co., Ltd. (000950.SZ) proposes to sell all assets and debts, except 7,069,000 restricted shares of Donlinks International Investment Co., Ltd. (000893.SZ) held by the company, to its controlling shareholder Jianfeng Group. The assets and debts being proposed to be sold are estimated to total 1.487 billion yuan. Meanwhile, the company proposes to acquire 96.59 percent equities of Chongqing Pharmaceutical (Group) Co., Ltd. held by several shareholders by issuing shares at 5.93 yuan per share through private placement. The transaction is primarily set at 6.698 billion yuan. According to performance commitment, the net profit of Chongqing Pharmaceutical during the 2016-2018 period should reach 450 million yuan, 549 million yuan and 620 million yuan, respectively.
Comment: Since the State-owned Assets Supervision and Administration Commission of Chongqing Municipality will remain as the actual controller of the company after the reorganization, so the transaction means no back-door listing. After the reorganization, Jianfeng Chemical is able to exchange out chemical assets with weak profitability, inject quality medicine assets and protect its shell resource.
○Baoshan Iron ＆ Steel to exchange shares with Wuhan Iron and Steel for merging
------
Baoshan Iron ＆ Steel Co., Ltd. (600019.SH) proposes to issue A shares to all stock-for-stock shareholders of Wuhan Iron and Steel Company Limited (600005.SH), and implement the merging. The stock-for-stock prices of the two listed companies are 4.6 yuan per share and 2.58 yuan per share respectively, thus, the determined stock-for-stock proportion is that one share of Wuhan Iron and Steel can be exchanged for 0.56 share of Baoshan Iron ＆ Steel. Based on calculation, the equity will total at 22.1 billion shares roughly after merging, and the total assets reached 362.1 billion yuan at the end of this June, with revenue of 106.8 billion yuan and gross profit rate of 12.29 percent for the first half year. The two companies has suspended their trading since June 27, and the stock prices before that were 4.9 yuan and 2.76 yuan respectively.
TOP
○Rightway Real Estate Development to acquire controlling right of Guodong Construction at price with premium of 70 pct
------
Sichuan Guodong Construction Group Co., Ltd., substantial shareholder of Sichuan Guodong Construction Co., Ltd. (600321.SH), plans to transfer its held 358 million shares to Rightway Real Estate Development Co., Ltd. at 7 yuan per share, which has a premium of 74 percent compared to the latest stock price of 4.02 yuan per share before trading suspension. Rightway Real Estate Development will hold 23.7 percent of the equities after transfer, and the shareholding proportion of Guodong Construction Group will cut to 21.82 percent from 45.53 percent. The equities held by the two groups are close. However, Guodong Construction Group has promised not to search for the controlling right of the listed company through any ways.
Comment: Guodong Construction previously suspended its trading to plan backdoor listing for Rightway Real Estate Development, and proposed to swap all its assets and liabilities to invest in real estate business of the latter. But due to factors including new restructuring rules, the listed company announced to stop the restructuring. This time, although it resumes its trading without successful restructuring, investment from Rightway Real Estate Development also leave some space for the listed company's next-step capital operation. Based on announcement, Rightway Real Estate Development has registered in Dalian city, with registered capital of 7.95 billion yuan.
○ Kelin Environmental Protection Equipment to alter actual controller
------
Six shareholders, such as Song Qidi and his held Jiangsu Kelin Group Co., Ltd., which is the actual controller of Kelin Environmental Protection Equipment, Inc. (002499.SZ), Xu Tianping and others, plan to transfer 19 percent equities of the listed company to Chongqing Dongcheng Ruiye Investment Co., Ltd., and meanwhile, voting right of additional 9 percent equities also to Dongcheng Ruiye Investment (this part of 9 percent will also be transferred in the future). Dongcheng Ruiye Investment will hold 28 percent equities of the listed company after successful transactions to become the largest shareholder, and the actual controller of the listed company will also alter.
Comment: Dongcheng Ruiye Investment is mainly engaged in project investment, with Tibet Zhihan Energy Development Co. Ltd. as its controlling shareholder, and Ni Dong holds 90 percent equities of the latter as the actual controller. The scheme and price of this transaction have not been finally determined yet.
○ Invengo Information Technology to add investment in Internet of Things
------
Invengo Information Technology Co., Ltd. (002161.SZ) plans to raise 745 million yuan through private placement of 62.75 million shares at a price no less than 11.87 yuan per share, which will be used to invest in car networking application of RFID, technical application of Internet of Things in the intelligent tourism industry, application of Internet of Things in retail field, and etc. Chen Guangzhu, chairman and actual controller of the listed company, commits to subscribe 30 percent of the private placement.
○ Shares of Yongan Pharmaceutical and Sihuan Bioengineering bought to placard threshold of 5 pct
------
Shenzhen Shangyuan Capital, shareholder of Qianjiang Yongan Pharmaceutical Co., Ltd. (002365.SZ), bought 0.84 million shares of the listed company on Sep. 30, and after this, the former holds 18.71 shares, accounting for 10 percent. China Medium ＆ Small Companies Investment Co., Ltd., shareholder of Jiangsu Sihuan Bioengineering Co., Ltd. (000518.SZ), on Sep. 30 increased 110,000 shareholdings in the listed company, and it holds 51.50 million shares now, taking up 5 percent, which makes it as the second largest shareholder.
○ Jianmin Pharmaceutical to carry out private placement and expand production, employee shareholding plan to subscribe private placement
------
Jianmin Pharmaceutical Group Co., Ltd. (600976.SH) plans to raise 1.14 billion yuan through private placement of 45.29 million shares at 25.17 yuan per share to its controlling shareholder Holley Group, Zhou Jingchun, Sailing Capital International (Shanghai) Co., Ltd., core employee shareholding plan and others. All raised fund will be used for construction, production expansion and upgrading of intelligent manufacturing base to expand the medicine capacity. The project construction period is four years. Annual sales revenue may reach 2.4 billion yuan after full production, with average profit of around 230 million yuan annually.
○ Perfect World Co., Ltd. (002624.SZ) plans to acquire 100 equities of Antaeus Movie Theatres, Antaeus Film Studio and Antaeus Culture with around 1.35 billion yuan. Zhejiang Century Huatong Group Co., Ltd. (002602.SZ) plans to 100 equities of game company's DianDian Interactive Holding and DianDian Beijing respectively with 6,939 million yuan.
[Financial Reports Express]
○ North Huajin Chemical Industries and others predict growth
------
North Huajin Chemical Industries Co., Ltd. (000059.SZ) predicts a growth of 15.9 to 16.6 times for the first three quarters, mainly due to greatly-reduced costs; growth forecast of 460 percent to 490 percent for Beijing Watertek Information Technology Co., Ltd. (300324.SZ), mainly due to merging financial statements with Xi'an Xigu Micro-electronics Co., Ltd.; growth forecast of 170 percent to 210 percent for Ningbo Boway Alloy Material Co., Ltd. (601137.SH), mainly due to growth of new products sales.
Wenzhou Hongfeng Electrical Alloy Co., Ltd. (300283.SZ) forecasts a growth of 160 percent to 190 percent for the first three quarters, mainly due to growth in revenue and stock silver price; forecast growth of 130 percent to 146 percent for Chongqing Sokon Industry Group Co., Ltd. (601127.SH), mainly due to great growth in product sales; forecast growth of 148 percent to 174 percent for Shenzhen V＆T Technologies Co., Ltd. (300484.SZ), mainly due to great sales growth in machine controller of e-cars.
[Trading Alarms]
○ SSE releases 3Q report disclosure timetable
------
Hangzhou Hangyang Co., Ltd. (002430.SZ), Kelin Environmental Protection Equipment, Inc. (002499.SZ), Kingnet Network Co., Ltd. (002517.SZ) and Brother Enterprises Holding Co., Ltd. (002562.SZ) on the SME Board, with Songcheng Performance Development Co., Ltd. (300144.SZ) and Tianjin Pengling Rubber Hose Co., Ltd. (300375.SZ) on the ChiNext Board will be the first movers to disclose the third quarterly report on Oct. 11. The first wave of four companies listed on the Main Board of Shenzhen Stock Exchange (SSE) will disclose financial reports on Oct. 18.
○ Jizhi Mechatronic to issue new shares on Oct. 10
------
Hangzhou Jizhi Mechatronic Co., Ltd. (300553.SZ) will issue new shares at 14.08 yuan per share, with a P/E ratio of 22.99 times and upper subscription limit of 120,000 shares. It is mainly engaged in fully-automatic balancing machine.
[Weekly Review]
○ Key factor to master market trend
------
There is always a section of notes repeated in music to set emotional tone for the whole chapter. There is always a certain factor to repeatedly play a role in market trend to guide the rises and falls. During this National Holiday, international oil price soared, gold price plummeted, and key factor becomes increasingly clear.
Crude oil had consecutively dropped in the previous years, and hit from shale oil and gas is the main factor. But since this year, main oil producing nations have held production frozen meetings for times, and will hold conference to guarantee the implementation. Driven by this, the oil price has recovered, closing to a new high within 2016.
Gold has performed well in the first half year, as many countries constantly expand the QE program, or even carry out negative interest rates. But in the G20 meeting during September, countries reached the agreement that they should reinforce the fiscal policies and not rely too much on monetary policies, and the following decisions of central banks also prove this. Therefore, the gold price suddenly falls. Whether to stop monetary policies is the core factor to cause this round of fluctuation in gold market.
In terms of A shares finally, the dramatic fluctuation last year was caused by leverage, no matter rise or fall. However, "intensifying the supervision" has become the most obvious feature since this year. Stock-price manipulation and restructuring for backdoor listing are both hit by constant supervisions. The large-cap indexes do not fluctuate too much, but the hot wave of short-term conceptual themes obviously weakens. Themes with substantial changes in fundamentals marked by performance growth, controlling right alteration and others start to perform well. Investors are better to adapt such trend, and search for investment opportunities without breaking the regulatory rules.
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