[Today's Guide]
○ State Council executive meeting to accept de-capacity and encourage mergers and reorganizations in iron ＆ steel industry
○ Low inventory and higher cost drive compound fertilizer price higher
○ Deren Electronic acquires peer company, Joincare Pharm. invests in medical business
○Several parties increase shareholdings in Baoguang Vacuum Electronic Apparatus, CSCEC again bought by Anbang to 5 pct. limit
[SSN Focus]
○ State Council executive meeting to accept de-capacity and encourage mergers and reorganizations in iron ＆ steel industry
------
The executive meeting of the State Council convened on Nov. 23 pointed out that the tasks of eliminating outdated capacities in the iron ＆ steel and coal industries of the whole year have been generally completed despite imbalanced progress and illicit new iron ＆ steel capacities in individual enterprises. It will guide local and central enterprises in conducting acceptance of the tasks of eliminating outdated capacities strictly according to the standards. It will continue encouraging Baosteel, Wuhan Iron and Steel and other advantageous enterprises in conducting mergers and reorganizations and introduce policies on the disposal of debts related to the de-capacity and the disposal of assets.
Comment: With the implementation of the de-capacity, the daily average output of crude steel witnessed month-on-month decrease in October. The production restriction for environmental protection in Hebei and other northern provinces in November will facilitate the iron market in de-stocking and improving the profitability of steel enterprises. The reorganization of Baosteel and Wuhan Iron and Steel and the bankruptcy and reorganization of Dongbei Special Steel Group Co., Ltd., the shareholder of Fushun Special Steel Co., Ltd. (600399.SH), played leading roles in the reorganization of other steel enterprises. Pomegranate Group increased the shareholding in Beijing Shougang Co., Ltd. (000959.SZ), which shows that the reform of state-owned steel enterprises is attracting the attention of capitals.
[SSN Selection]
○ China will promote the research and manufacturing of engines for airliners, advanced helicopters and heavy gas turbines during the 13th Five-year Plan period, indicated Miao Wei, Minister of the Ministry of Industry and Information Technology (MIIT), on Nov. 24.
○ China's National Development and Reform Commission (NDRC), Ministry of Commerce and Ministry of Agriculture have sent delegations to the Philippines to have discussions with their Philippine counterparts, indicated the spokesperson of the Ministry of Foreign Affairs on Nov. 24.
○ The NDRC and the State Forestry Administration jointly issued guidance, proposing to implement PPP models in five key sectors in the forestry industry.
○ The releasing of financial reports by U.S. companies is coming to an end. Statistics show that health equipment and services, software and Internet-based industries saw outstanding performance.
○ It is reported that 50 classmates of Jia Yueting in Cheung Kong Graduate School of Business visited LeTV Building on Nov. 23.
TOP
[Industry Information]
○ Low inventory and higher cost drive compound fertilizer price higher
------
SSN learnt that certain compound fertilizer enterprises have released policies and prices for winter storage. Driven by the surging prices of raw materials, the prices saw slight hikes while the low-end saw obvious increases. The statistics of Baichuan show that the latest price hiked by 30 to 50 yuan/tonne compared with the price in autumn. The action plan on zero growth in fertilizer use in 2020 issued by the Ministry of Agriculture proposes to improve the utilization rate of fertilizers and promote the slow release fertilizer and other new types of fertilizers through the supply-side reform.
Comment: The overall production rate of the compound fertilizer industry was only 36 percent as at October, which results in relatively low inventory in the industry. In addition, the surging urea price also supported the rise of the compound fertilizer price. Currently, the utilization proportion of compound fertilizer in China is about 35 percent, far below the 70 to 80 percent in developed countries. The improvement of the proportion of the compound fertilizer will improve the utilization rate of fertilizers. Securities companies pointed out that Kingenta Ecological Engineering Group Co., Ltd. (002470.SZ) owns a compound fertilizer capacity of 6.55 million tones and its capacity of slow controlled release fertilizer ranks high in the industry. Stanley Agricultural Group Co., Ltd. (002588.SZ) owns an annual compound fertilizer capacity of 6.90 million tones. Chengdu Wintrue Holding Co., Ltd. (002539.SZ) owns a capacity of 4.65 million tones.
TOP
[Announcement Interpretation]
○ Deren Electronic acquires peer company
------
Shenzhen Deren Electronic Co., Ltd. (002055.SZ) proposes to acquire 60 percent equities in for 600 million yuan by issuing additional shares and in cash. It also plans to raise no more than 439 million yuan supporting fund. As one of the largest automobile wire harness in China, Liuzhou Shuangfei Auto Electric Appliances Manufacturing Co., Ltd. promises that its net profit after deducting non-recurring profit and loss should be no less than 120 million, 140 million and160 million yuan in the next three years.
The company also announces that its subsidiary Guangdong KS Deren Auto Parts Co., Ltd. is certified as a local supplier of 80D, Audi X89 (Audi Q5) and 55G and A-SUV ABS wire harness project by FAW-Volkswagen.
○ Joincare Pharm. invests in medical business
------
Joincare Pharmaceutical Group Industry Co., Ltd. (600380.SH) proposes to raise no more than 2,854 million yuan by issuing shares at 9.49 yuan per share through private placement. Its controlling shareholder will subscribe 800 million yuan. The proceeds will be invested in the the construction of its big health industry base in Zhuhai and the medical industrialization base in Pingshan District, Shenzhen with Shenzhen Haibin Pharmaceutical Co., Ltd. The company's stock price closed at 10.66 yuan per share before trading suspension.
TOP
○ Several parties increase shareholdings in Baoguang Vacuum Electronic Apparatus
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Shaanxi Baoguang Vacuum Electronic Apparatus Co., Ltd. (600379.SH) said in a reply to the inquiry of Shanghai Stock Exchange that its shareholder Tibet Fenghong Investment Management Co., Ltd. has not talked to its actual controller, and they have not reached consensus on matters in relation to the company's controlling right. The company will resume trading on Nov. 25.
During the period of trading suspension, the company's substantial shareholder Baoguang Group signed an agreement on persons acting in concert with another shareholder. They altogether hold a 22.56 percent stake in the company. Meanwhile, Baoguang Group proposes to increase shareholding with no less than 55 million yuan. In addition, as Tibet Fenghong Investment Management bought 2,239,000 shares in the company on Nov. 17, it, along with its persons acting in concert , altogether hold a 20.9189 percent stake in the company. Tibet Fenghong Investment Management plans to increase shareholding with no less than 30 million yuan in the 12 months starting from Nov. 22.
○ CSCEC again bought by Anbang to 5 pct. limit
------
China State Construction Engineering Corporation Limited (CSCEC)(601668.SH) announces that as of Nov. 24, Anbang Asset Management Co., Ltd. holds 3 billion shares in the company, accounting for 10 percent of its total share capital.
○ Inform Storage Equipment bought by two investment companies to 5 pct. Limit for first time
------
Nanjing Inform Storage Equipment Co., Ltd. (603066.SH) announces that Cybernaut Lvke Investment Management Co., Ltd. and Boer Investment Management Co., Ltd. became parties acting in concert. As of Nov. 23, the two hold 5,605,000 shares in the company, accounting for 5.57 percent of its total share capital. Among them, 4.48 million shares were bought by Cybernaut Lvke Investment Management via block trading at 49.6 yuan per share, according to information from the stock exchange. The latest stock price of the listed company is 59.96 per share.
○ Aodong Pharm. bought by substantial shareholder
------
In an announcement on the abnormal fluctuations in stock trading, Jilin Aodong Pharmaceutical Group Co., Ltd. (000623.SZ) said that its substantial shareholder Dunhua Jincheng Industrial Co., Ltd. increased holdings in the company by 2.95 million shares on Nov. 22, making its shareholding up to 26.25 percent. The company announced on the same day that it was for the first time bought by Sunshine Insurance Group to 5 percent limit through secondary market acquisition.
[Trading Alarms]
○ MedicalSystem and to Gaozheng Industrial Explosive conduct IPO on Nov. 25
------
MedicalSystem Company (732990) will offer shares at 9.69 yuan per share with an upper limit of 20,000 shares for each applicant. The company is mainly engaged in clinical medical management information system. Tibet Gaozheng Industrial Explosive Co., Ltd. (002827.SZ) will offer shares at 8.23 yuan per share with an upper limit of 18,000 shares for each applicant. The company is mainly engaged in industrial explosive equipment.
TOP
○ State Council executive meeting to accept de-capacity and encourage mergers and reorganizations in iron ＆ steel industry
○ Low inventory and higher cost drive compound fertilizer price higher
○ Deren Electronic acquires peer company, Joincare Pharm. invests in medical business
○Several parties increase shareholdings in Baoguang Vacuum Electronic Apparatus, CSCEC again bought by Anbang to 5 pct. limit
[SSN Focus]
○ State Council executive meeting to accept de-capacity and encourage mergers and reorganizations in iron ＆ steel industry
------
The executive meeting of the State Council convened on Nov. 23 pointed out that the tasks of eliminating outdated capacities in the iron ＆ steel and coal industries of the whole year have been generally completed despite imbalanced progress and illicit new iron ＆ steel capacities in individual enterprises. It will guide local and central enterprises in conducting acceptance of the tasks of eliminating outdated capacities strictly according to the standards. It will continue encouraging Baosteel, Wuhan Iron and Steel and other advantageous enterprises in conducting mergers and reorganizations and introduce policies on the disposal of debts related to the de-capacity and the disposal of assets.
Comment: With the implementation of the de-capacity, the daily average output of crude steel witnessed month-on-month decrease in October. The production restriction for environmental protection in Hebei and other northern provinces in November will facilitate the iron market in de-stocking and improving the profitability of steel enterprises. The reorganization of Baosteel and Wuhan Iron and Steel and the bankruptcy and reorganization of Dongbei Special Steel Group Co., Ltd., the shareholder of Fushun Special Steel Co., Ltd. (600399.SH), played leading roles in the reorganization of other steel enterprises. Pomegranate Group increased the shareholding in Beijing Shougang Co., Ltd. (000959.SZ), which shows that the reform of state-owned steel enterprises is attracting the attention of capitals.
[SSN Selection]
○ China will promote the research and manufacturing of engines for airliners, advanced helicopters and heavy gas turbines during the 13th Five-year Plan period, indicated Miao Wei, Minister of the Ministry of Industry and Information Technology (MIIT), on Nov. 24.
○ China's National Development and Reform Commission (NDRC), Ministry of Commerce and Ministry of Agriculture have sent delegations to the Philippines to have discussions with their Philippine counterparts, indicated the spokesperson of the Ministry of Foreign Affairs on Nov. 24.
○ The NDRC and the State Forestry Administration jointly issued guidance, proposing to implement PPP models in five key sectors in the forestry industry.
○ The releasing of financial reports by U.S. companies is coming to an end. Statistics show that health equipment and services, software and Internet-based industries saw outstanding performance.
○ It is reported that 50 classmates of Jia Yueting in Cheung Kong Graduate School of Business visited LeTV Building on Nov. 23.
TOP
[Industry Information]
○ Low inventory and higher cost drive compound fertilizer price higher
------
SSN learnt that certain compound fertilizer enterprises have released policies and prices for winter storage. Driven by the surging prices of raw materials, the prices saw slight hikes while the low-end saw obvious increases. The statistics of Baichuan show that the latest price hiked by 30 to 50 yuan/tonne compared with the price in autumn. The action plan on zero growth in fertilizer use in 2020 issued by the Ministry of Agriculture proposes to improve the utilization rate of fertilizers and promote the slow release fertilizer and other new types of fertilizers through the supply-side reform.
Comment: The overall production rate of the compound fertilizer industry was only 36 percent as at October, which results in relatively low inventory in the industry. In addition, the surging urea price also supported the rise of the compound fertilizer price. Currently, the utilization proportion of compound fertilizer in China is about 35 percent, far below the 70 to 80 percent in developed countries. The improvement of the proportion of the compound fertilizer will improve the utilization rate of fertilizers. Securities companies pointed out that Kingenta Ecological Engineering Group Co., Ltd. (002470.SZ) owns a compound fertilizer capacity of 6.55 million tones and its capacity of slow controlled release fertilizer ranks high in the industry. Stanley Agricultural Group Co., Ltd. (002588.SZ) owns an annual compound fertilizer capacity of 6.90 million tones. Chengdu Wintrue Holding Co., Ltd. (002539.SZ) owns a capacity of 4.65 million tones.
TOP
[Announcement Interpretation]
○ Deren Electronic acquires peer company
------
Shenzhen Deren Electronic Co., Ltd. (002055.SZ) proposes to acquire 60 percent equities in for 600 million yuan by issuing additional shares and in cash. It also plans to raise no more than 439 million yuan supporting fund. As one of the largest automobile wire harness in China, Liuzhou Shuangfei Auto Electric Appliances Manufacturing Co., Ltd. promises that its net profit after deducting non-recurring profit and loss should be no less than 120 million, 140 million and160 million yuan in the next three years.
The company also announces that its subsidiary Guangdong KS Deren Auto Parts Co., Ltd. is certified as a local supplier of 80D, Audi X89 (Audi Q5) and 55G and A-SUV ABS wire harness project by FAW-Volkswagen.
○ Joincare Pharm. invests in medical business
------
Joincare Pharmaceutical Group Industry Co., Ltd. (600380.SH) proposes to raise no more than 2,854 million yuan by issuing shares at 9.49 yuan per share through private placement. Its controlling shareholder will subscribe 800 million yuan. The proceeds will be invested in the the construction of its big health industry base in Zhuhai and the medical industrialization base in Pingshan District, Shenzhen with Shenzhen Haibin Pharmaceutical Co., Ltd. The company's stock price closed at 10.66 yuan per share before trading suspension.
TOP
○ Several parties increase shareholdings in Baoguang Vacuum Electronic Apparatus
------
Shaanxi Baoguang Vacuum Electronic Apparatus Co., Ltd. (600379.SH) said in a reply to the inquiry of Shanghai Stock Exchange that its shareholder Tibet Fenghong Investment Management Co., Ltd. has not talked to its actual controller, and they have not reached consensus on matters in relation to the company's controlling right. The company will resume trading on Nov. 25.
During the period of trading suspension, the company's substantial shareholder Baoguang Group signed an agreement on persons acting in concert with another shareholder. They altogether hold a 22.56 percent stake in the company. Meanwhile, Baoguang Group proposes to increase shareholding with no less than 55 million yuan. In addition, as Tibet Fenghong Investment Management bought 2,239,000 shares in the company on Nov. 17, it, along with its persons acting in concert , altogether hold a 20.9189 percent stake in the company. Tibet Fenghong Investment Management plans to increase shareholding with no less than 30 million yuan in the 12 months starting from Nov. 22.
○ CSCEC again bought by Anbang to 5 pct. limit
------
China State Construction Engineering Corporation Limited (CSCEC)(601668.SH) announces that as of Nov. 24, Anbang Asset Management Co., Ltd. holds 3 billion shares in the company, accounting for 10 percent of its total share capital.
○ Inform Storage Equipment bought by two investment companies to 5 pct. Limit for first time
------
Nanjing Inform Storage Equipment Co., Ltd. (603066.SH) announces that Cybernaut Lvke Investment Management Co., Ltd. and Boer Investment Management Co., Ltd. became parties acting in concert. As of Nov. 23, the two hold 5,605,000 shares in the company, accounting for 5.57 percent of its total share capital. Among them, 4.48 million shares were bought by Cybernaut Lvke Investment Management via block trading at 49.6 yuan per share, according to information from the stock exchange. The latest stock price of the listed company is 59.96 per share.
○ Aodong Pharm. bought by substantial shareholder
------
In an announcement on the abnormal fluctuations in stock trading, Jilin Aodong Pharmaceutical Group Co., Ltd. (000623.SZ) said that its substantial shareholder Dunhua Jincheng Industrial Co., Ltd. increased holdings in the company by 2.95 million shares on Nov. 22, making its shareholding up to 26.25 percent. The company announced on the same day that it was for the first time bought by Sunshine Insurance Group to 5 percent limit through secondary market acquisition.
[Trading Alarms]
○ MedicalSystem and to Gaozheng Industrial Explosive conduct IPO on Nov. 25
------
MedicalSystem Company (732990) will offer shares at 9.69 yuan per share with an upper limit of 20,000 shares for each applicant. The company is mainly engaged in clinical medical management information system. Tibet Gaozheng Industrial Explosive Co., Ltd. (002827.SZ) will offer shares at 8.23 yuan per share with an upper limit of 18,000 shares for each applicant. The company is mainly engaged in industrial explosive equipment.
TOP
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