[Today's Guide]
○ Xi requires moving faster in deepening civil-military integration development
○ Jiangsu accelerates state-owned assets reform, requiring advancing overall listing and mixed ownership reform
○ PPP boosts development of urban infrastructure, water treatment projects to see faster implementation
○ Shareholdings of Lijiang Yulong Tourism bought to placarded threshold of 5 pct again, Bossco Environmental Protection Technology signs big PPP project
[SSN Focus]
○ Xi requires moving faster in deepening civil-military integration development
------
Xi Jinping, general secretary of the CPC Central Committee, attended the Second Hi-Tech Achievement Exhibition of Civil-Military Integration Development in Beijing on Oct. 19. It is required to further advance the innovation of system reform, make efforts at both supply side and demand side, advance the work from aspects like organizational management, work operation, policies and systems, continue to reinforce civil-military integration development, move faster in deepening civil-military integration development, foster demonstration and excellent projects of civil-military integration, and make great contribution to the realization of revitalizing China and building a strong army.
TOP
○ Jiangsu accelerates state-owned assets reform, requiring advancing overall listing and mixed ownership reform
------
The government of Jiangsu province on Oct. 19 held the sixth news press for the supply side reform, and the press focuses on progress of state-owned enterprises (SOEs) reform in the province. It is introduced that Jiangsu has made great efforts in advancing the capitalization and securitization of state-owned assets. For the next step, Jiangsu will make full use of existing resources of listed companies, and promote competitive enterprises to realize overall listing. Jiangsu will select 10 enterprises among all mixed ownership enterprises in the province to pilot employee stock ownership plans, and promote relevant experiences. During the 13th five-year plan period (2016-2020), Jiangsu will reorganize or establish 4-5 provincial state-owned capital investment companies and 1 state-owned capital operation company. Jiangsu also vows to completely clear up all "zombie enterprises" before end 2018.
Comment: The State-owned Assets Supervision and Administration Commission (SASAC) of Jiangsu province owns 21 SOEs and 8 A-share listing platforms, and its securitization rate is lower than national average level. At present, the total market value of Jinling Hotel Corporation, Ltd. (601007.SH), Jiangsu Sainty Corp., Ltd. (600287.SH) and Jiangsu Holly Corporation (600128.SH) is lower than 6 billion yuan, and all of them are involved in competitive industries. Jinling Hotel Corporation and Jiangsu Zhongshan Hotel Group Co., Ltd. are both engaged in the hotel and dining services industry. Jiangsu Sainty Corp. Ltd., Jiangsu Soho International Group Corp. and Jiangsu High Hope International Group Corporation overlap with each other in textile and garment business, meaning serious homogenization completion and requiring integration.
[SSN Selection]
○ The National Video and Telephone Conference for Irrigation and Water Conservancy Projects in Winter and Spring was held on Oct. 19. Chinese Premier Li Keqiang required more efforts made in irrigation and water conservancy, and major water conservancy projects.
○ Monthly report released by China Securities Depository and Clearing Corporation Limited (CSDC) shows that 21 QFII accounts and 34 RQFII accounts were newly opened in September. The two figures both record new highs in 2016.
○ Data from China's central bank shows that as of end September, overseas institutions and individuals totally held domestic stocks worth 656.2 billion yuan, increasing by 55 billion yuan when compared with the figure recorded by end June.
○ Beijing Municipal Commission of Economy and Information Technology on Oct. 18 unveiled the third batch of subsidies for new energy vehicles. Beiqi Foton Motor Co., Ltd. (600166.SZ), a listed company under BAIC Motor Corporation Ltd., is expected to obtain 392 million yuan subsidies.
○ Latest Bohai-Rim Steam-Coal Price surged by 7 yuan per ton. The low coal inventory of main electricity producers since October has been improved to some extent.
TOP
[Industry Information]
○ PPP boosts development of urban infrastrucuture, water treatment projects to see faster implementation
------
Multiple departments and commissions, with the Ministry of Finance (MOF) included, recently jointly announce the third batch of Public-Private Partnership (PPP) demonstration projects. The total planned investment reaches 1,170.8 billion yuan, far higher than that of the first two batches. The MOF indicates that it will choose outstanding social capitals and encourage choosing private capitals under the same conditions. The National Development and Reform Commission (NDRC) and the Ministry of Housing and Urban-Rural Development (MOHURD) recently jointly launched the Notice about Making Innovations in PPP of Major Municipal Works. It is clearly required to advance the application of PPP model in new-type urbanization and make more efforts in the construction of urban infrastructure.
Comment: Institutions estimate that driven by PPP model, projects concerning urban infrastructure like water supply and sewage treatment might see faster implementation. Bohai Water Industry Co., Ltd. (000605.SZ) has been engaged in multiple PPP projects concerning sewage treatment. The company proposes to acquire 55 percent equities of Jiacheng Environmental Protection Engineering Co., Ltd. through private placement in a bid to expand its water treatment business. Grandblue Environment Co., Ltd. (600323.SH) is primarily engaged in water supply, sewage treatment and solid waste business. The company also actively seeks for external expansion.
○ E-invoice sees year of policies implementation
------
30 provincial branches of China Telecom Corporation Ltd. have recently finished the work to launch electronic regular invoice for value-added tax, making it be the one of the first movers to finish such work among the central state-owned enterprises, according to the Xinhua News Agency. State Administration of Taxation (SAT) issued the announcement at the end of 2015, and required telecom and other industries releasing a large amount of invoices to do the jobs for implementing e-invoice. Compared to traditional paper ones, e-invoice is more adapted to features of e-commerce trade, such as paperless operation, high efficiency and virtualization, to meet the demands for future development.
Comment: It is a year to implement supporting policies for e-invoice in 2016, research report of GF Securities believed. A double-win profitable mode of basic and derive services has already been determined for e-invoice. The market space is expected to reach 30 to 40 billion yuan for the former one; while the latter will provide a series of commercial analysis based on the data included in the platform, and these data will become a market of 100 billion yuan going to be deeply excavated. The e-inv.cn under TungKong Inc. (002117.SZ) is the only e-invoice service platform and national e-invoice research center authorized by Beijing Municipal Office, SAT. Aisino Corporation (600271.SH) has provided e-invoice billing service for over 30 enterprises.
○ Football becomes key point of P.E. reform, development planning furhter details
------
National Development and Reform Commission on Oct. 19 issued a notice named as Key Task Divisions for Medium and Long Term Development ＆ Planning for Chinese Football (2016-2050), with 22 key tasks; the football system reform during the "13th Five-Year Plan" period ranks No.1 regarding to importance. Furthermore, campus football popularization, key construction engineering for football site, and etc. are also highlighted. The notice also proposed to positively study and promote the launch of football lottery with Chinese football professional league as gambling target.
Comment: As the largest single sport in P.E. industry, football gains a output value of over 40 percent; based on the P.E. industrial scale target of 5 trillion yuan by 2025, the football market has a space of 2 trillion yuan, institutions believed. The latest announcement of Ledman Optoelectronic Co., Ltd. (300162.SZ) shows that it has been the first cooperative enterprise for LED panel for the said league. The okooo.com, a internet lottery platform under People.cn Co., Ltd. (603000.SH), is likely to benefit from football lottery development. Wuhan DDMC Culture Co., Ltd. (600136.SH) has deployed in football brokerage and stadium operation through extensive merging ＆ acquisition.
TOP
[Announcement Interpretation]
○ Shareholdings of Lijiang Yulong Tourism bought to placarded threshold of 5 pct, Huapont Life Sciences and person acting in concert hold equity over 10 pct
------
Lijiang Yulong Tourism Co., Ltd. (002033.SZ) announced that Huapont Life Sciences Co., Ltd. (002004.SZ) accumulatively bought 21.15 million shares of Lijiang Yulong Tourism from Oct. 13 to 17 at the price between 15.19 to 16.09 yuan, accounting for 5.0037 percent of the former's total equity, which reached the placarded threshold. Previously, Zhang Yizhuo, person acting in concert of Huapont Life Sciences, had already held 21.135 million shares of Lijiang Yulong Tourism, taking up 5.0002 percent. After the said increment, Huapont Life Sciences and its person acting in concert have already held the equity over 10 percent.
○ Bossco Environmental Protection Technology signs big PPP project
------
Guangxi Bossco Environmental Protection Technology Co., Ltd. (300422.SZ) will win the PPP project of Taibai Lake ecological protection ＆ infrastructure construction in Hezhou city, with a total investment of around 280 million yuan, 55.48 percent of the revenue in 2015.
○ Shareholder of Goldlok Toys Holdings to increase shareholdings
------
Yang Guangcheng, shareholder of Goldlok Toys Holdings (Guangdong) Co., Ltd. (002348.SZ), plans to increase the shareholdings in the listed company with funds no more than 50 million yuan in next year, so as to enhance the investor confidence. Yang currently holds 13.05 percent of the equity.
○ The restructuring schemes of Wuhan Huazhong Numerical Control Co., Ltd. (300161.SZ), Fujian Start Group Co., Ltd. (600734.SH) and Zhejiang Furun Co., Ltd. (600070.SH) have been unconditionally approved by China Securities Regulatory Commission.
[Financial Reports Express]
○ Wuzhong Industrial and Henryda Technological Chemical predict performance growth
------
Jiangsu Wuzhong Industrial Co., Ltd. (600200.SH) predicted a growth of 195 percent for the first three quarters, mainly due to financial statement combined with that of Xiangshui Henryda Technological Chemical Co., Ltd.; growth forecast of 50 percent to 70 percent for Shanghai Zijiang Enterprise Group Co., Ltd. (600210.SZ), mainly due to reduced costs and raised profits.
[Trading Alarms]
○ Zhong Fu Tong to issue shares on Oct. 20
------
Zhong Fu Tong Co., Ltd. (300560.SZ) will issue shares at 10.26 yuan per share, with P/E ratio of 22.99 times and upper subscription limit of 17,500 shares. It is mainly engaged in maintenance and optimization for communication network.
TOP
○ Xi requires moving faster in deepening civil-military integration development
○ Jiangsu accelerates state-owned assets reform, requiring advancing overall listing and mixed ownership reform
○ PPP boosts development of urban infrastructure, water treatment projects to see faster implementation
○ Shareholdings of Lijiang Yulong Tourism bought to placarded threshold of 5 pct again, Bossco Environmental Protection Technology signs big PPP project
[SSN Focus]
○ Xi requires moving faster in deepening civil-military integration development
------
Xi Jinping, general secretary of the CPC Central Committee, attended the Second Hi-Tech Achievement Exhibition of Civil-Military Integration Development in Beijing on Oct. 19. It is required to further advance the innovation of system reform, make efforts at both supply side and demand side, advance the work from aspects like organizational management, work operation, policies and systems, continue to reinforce civil-military integration development, move faster in deepening civil-military integration development, foster demonstration and excellent projects of civil-military integration, and make great contribution to the realization of revitalizing China and building a strong army.
TOP
○ Jiangsu accelerates state-owned assets reform, requiring advancing overall listing and mixed ownership reform
------
The government of Jiangsu province on Oct. 19 held the sixth news press for the supply side reform, and the press focuses on progress of state-owned enterprises (SOEs) reform in the province. It is introduced that Jiangsu has made great efforts in advancing the capitalization and securitization of state-owned assets. For the next step, Jiangsu will make full use of existing resources of listed companies, and promote competitive enterprises to realize overall listing. Jiangsu will select 10 enterprises among all mixed ownership enterprises in the province to pilot employee stock ownership plans, and promote relevant experiences. During the 13th five-year plan period (2016-2020), Jiangsu will reorganize or establish 4-5 provincial state-owned capital investment companies and 1 state-owned capital operation company. Jiangsu also vows to completely clear up all "zombie enterprises" before end 2018.
Comment: The State-owned Assets Supervision and Administration Commission (SASAC) of Jiangsu province owns 21 SOEs and 8 A-share listing platforms, and its securitization rate is lower than national average level. At present, the total market value of Jinling Hotel Corporation, Ltd. (601007.SH), Jiangsu Sainty Corp., Ltd. (600287.SH) and Jiangsu Holly Corporation (600128.SH) is lower than 6 billion yuan, and all of them are involved in competitive industries. Jinling Hotel Corporation and Jiangsu Zhongshan Hotel Group Co., Ltd. are both engaged in the hotel and dining services industry. Jiangsu Sainty Corp. Ltd., Jiangsu Soho International Group Corp. and Jiangsu High Hope International Group Corporation overlap with each other in textile and garment business, meaning serious homogenization completion and requiring integration.
[SSN Selection]
○ The National Video and Telephone Conference for Irrigation and Water Conservancy Projects in Winter and Spring was held on Oct. 19. Chinese Premier Li Keqiang required more efforts made in irrigation and water conservancy, and major water conservancy projects.
○ Monthly report released by China Securities Depository and Clearing Corporation Limited (CSDC) shows that 21 QFII accounts and 34 RQFII accounts were newly opened in September. The two figures both record new highs in 2016.
○ Data from China's central bank shows that as of end September, overseas institutions and individuals totally held domestic stocks worth 656.2 billion yuan, increasing by 55 billion yuan when compared with the figure recorded by end June.
○ Beijing Municipal Commission of Economy and Information Technology on Oct. 18 unveiled the third batch of subsidies for new energy vehicles. Beiqi Foton Motor Co., Ltd. (600166.SZ), a listed company under BAIC Motor Corporation Ltd., is expected to obtain 392 million yuan subsidies.
○ Latest Bohai-Rim Steam-Coal Price surged by 7 yuan per ton. The low coal inventory of main electricity producers since October has been improved to some extent.
TOP
[Industry Information]
○ PPP boosts development of urban infrastrucuture, water treatment projects to see faster implementation
------
Multiple departments and commissions, with the Ministry of Finance (MOF) included, recently jointly announce the third batch of Public-Private Partnership (PPP) demonstration projects. The total planned investment reaches 1,170.8 billion yuan, far higher than that of the first two batches. The MOF indicates that it will choose outstanding social capitals and encourage choosing private capitals under the same conditions. The National Development and Reform Commission (NDRC) and the Ministry of Housing and Urban-Rural Development (MOHURD) recently jointly launched the Notice about Making Innovations in PPP of Major Municipal Works. It is clearly required to advance the application of PPP model in new-type urbanization and make more efforts in the construction of urban infrastructure.
Comment: Institutions estimate that driven by PPP model, projects concerning urban infrastructure like water supply and sewage treatment might see faster implementation. Bohai Water Industry Co., Ltd. (000605.SZ) has been engaged in multiple PPP projects concerning sewage treatment. The company proposes to acquire 55 percent equities of Jiacheng Environmental Protection Engineering Co., Ltd. through private placement in a bid to expand its water treatment business. Grandblue Environment Co., Ltd. (600323.SH) is primarily engaged in water supply, sewage treatment and solid waste business. The company also actively seeks for external expansion.
○ E-invoice sees year of policies implementation
------
30 provincial branches of China Telecom Corporation Ltd. have recently finished the work to launch electronic regular invoice for value-added tax, making it be the one of the first movers to finish such work among the central state-owned enterprises, according to the Xinhua News Agency. State Administration of Taxation (SAT) issued the announcement at the end of 2015, and required telecom and other industries releasing a large amount of invoices to do the jobs for implementing e-invoice. Compared to traditional paper ones, e-invoice is more adapted to features of e-commerce trade, such as paperless operation, high efficiency and virtualization, to meet the demands for future development.
Comment: It is a year to implement supporting policies for e-invoice in 2016, research report of GF Securities believed. A double-win profitable mode of basic and derive services has already been determined for e-invoice. The market space is expected to reach 30 to 40 billion yuan for the former one; while the latter will provide a series of commercial analysis based on the data included in the platform, and these data will become a market of 100 billion yuan going to be deeply excavated. The e-inv.cn under TungKong Inc. (002117.SZ) is the only e-invoice service platform and national e-invoice research center authorized by Beijing Municipal Office, SAT. Aisino Corporation (600271.SH) has provided e-invoice billing service for over 30 enterprises.
○ Football becomes key point of P.E. reform, development planning furhter details
------
National Development and Reform Commission on Oct. 19 issued a notice named as Key Task Divisions for Medium and Long Term Development ＆ Planning for Chinese Football (2016-2050), with 22 key tasks; the football system reform during the "13th Five-Year Plan" period ranks No.1 regarding to importance. Furthermore, campus football popularization, key construction engineering for football site, and etc. are also highlighted. The notice also proposed to positively study and promote the launch of football lottery with Chinese football professional league as gambling target.
Comment: As the largest single sport in P.E. industry, football gains a output value of over 40 percent; based on the P.E. industrial scale target of 5 trillion yuan by 2025, the football market has a space of 2 trillion yuan, institutions believed. The latest announcement of Ledman Optoelectronic Co., Ltd. (300162.SZ) shows that it has been the first cooperative enterprise for LED panel for the said league. The okooo.com, a internet lottery platform under People.cn Co., Ltd. (603000.SH), is likely to benefit from football lottery development. Wuhan DDMC Culture Co., Ltd. (600136.SH) has deployed in football brokerage and stadium operation through extensive merging ＆ acquisition.
TOP
[Announcement Interpretation]
○ Shareholdings of Lijiang Yulong Tourism bought to placarded threshold of 5 pct, Huapont Life Sciences and person acting in concert hold equity over 10 pct
------
Lijiang Yulong Tourism Co., Ltd. (002033.SZ) announced that Huapont Life Sciences Co., Ltd. (002004.SZ) accumulatively bought 21.15 million shares of Lijiang Yulong Tourism from Oct. 13 to 17 at the price between 15.19 to 16.09 yuan, accounting for 5.0037 percent of the former's total equity, which reached the placarded threshold. Previously, Zhang Yizhuo, person acting in concert of Huapont Life Sciences, had already held 21.135 million shares of Lijiang Yulong Tourism, taking up 5.0002 percent. After the said increment, Huapont Life Sciences and its person acting in concert have already held the equity over 10 percent.
○ Bossco Environmental Protection Technology signs big PPP project
------
Guangxi Bossco Environmental Protection Technology Co., Ltd. (300422.SZ) will win the PPP project of Taibai Lake ecological protection ＆ infrastructure construction in Hezhou city, with a total investment of around 280 million yuan, 55.48 percent of the revenue in 2015.
○ Shareholder of Goldlok Toys Holdings to increase shareholdings
------
Yang Guangcheng, shareholder of Goldlok Toys Holdings (Guangdong) Co., Ltd. (002348.SZ), plans to increase the shareholdings in the listed company with funds no more than 50 million yuan in next year, so as to enhance the investor confidence. Yang currently holds 13.05 percent of the equity.
○ The restructuring schemes of Wuhan Huazhong Numerical Control Co., Ltd. (300161.SZ), Fujian Start Group Co., Ltd. (600734.SH) and Zhejiang Furun Co., Ltd. (600070.SH) have been unconditionally approved by China Securities Regulatory Commission.
[Financial Reports Express]
○ Wuzhong Industrial and Henryda Technological Chemical predict performance growth
------
Jiangsu Wuzhong Industrial Co., Ltd. (600200.SH) predicted a growth of 195 percent for the first three quarters, mainly due to financial statement combined with that of Xiangshui Henryda Technological Chemical Co., Ltd.; growth forecast of 50 percent to 70 percent for Shanghai Zijiang Enterprise Group Co., Ltd. (600210.SZ), mainly due to reduced costs and raised profits.
[Trading Alarms]
○ Zhong Fu Tong to issue shares on Oct. 20
------
Zhong Fu Tong Co., Ltd. (300560.SZ) will issue shares at 10.26 yuan per share, with P/E ratio of 22.99 times and upper subscription limit of 17,500 shares. It is mainly engaged in maintenance and optimization for communication network.
TOP
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