[Today's Guide]
○ Gains supply-side reform to speed up, corn industry to see new opportunities
○ Geothermal energy to embrace great development, Major national science and technology project shifts to 5G
○ Bohai International Trust to get 15.13 pct. of equity of Longxing Chemical, EVE Energy signed orders worth RMB1 bln with King Long Bus
○ Two companies proposes high share conversion and dividend，several companies report performance growth
[SSN Focus]
○ Gains supply-side reform to speed up, corn industry to see new opportunities
------
The work conference on national grains circulation was held in Beijing from Jan. 7 to 8. It required advancing the reform in the corn purchase and storage system and speeding up in de-stocking of corns. It will cooperate in expanding the output of fuel ethanol and the application and support the processing and transformation of corns. In addition, it will deepen the reform of state-owned grains enterprises and actively develop the mixed ownership grain economy.
Comment: Securities companies believe that the seeding industry is a key area in the agricultural supply-side structural reform. As the restructuring and de-stocking complete, the profitability of the corn and other industries will improve. Shandong Denghai Seeds Co., Ltd. (002041.SZ) is a leader of corn seeds and its products are widely planted. COFCO Biochemical (Anhui) Co., Ltd. (000930.SZ) is principally engaged in fuel ethanol. It is a leader in the deep processing of corns. Its controller shareholder is COFCO.
[SSN Selection]
○ China Securities Regulatory Commission (CSRC) approved the IPO applications of 14 enterprises, including Chongqing Construction Engineering Group CO., Ltd. They will raise a total of no more than 4.8 billion yuan.
○ Many manufacturers released hardware products based on the Alexa of Amazon at the CES opened on Jan. 5
○ The quoted price of cobaltosic oxide products rose by nearly 10 percent on Jan. 6. Statistics show that the output of cathode materials of lithium batteries surged 43 percent year on year in 2016.
○Chengdu city, Sichuan province recently released its government work report, proposing to perfect urban non-motorized traffic system and support healthy development of sharing traffic like bike-sharing.
○Shanghai Municipal Commission of Housing and Urban-Rural Development announced on Jan. 7 that it will join hands with relevant departments to clear up and exam commercial office projects. During this period, online signing of contracts for such projects will be suspended during this period.
TOP
[Industry Information]
○Renewable energy enjoys advantages in heating, geothermal energy to embrace great development
------
CCTV News on Jan. 7 reported typical cases about that some places in the north part of China use renewable energy for clean heating. A housing estate in Zibo city, Shandong province circularly displaces the heat of underground soil (around 13 ℃) through three terrestrial heat pumps and then gathers the heat together for heating. Qingfeng county, Henan province pumps water from underground 2,000 meters and then heats it up for heating. The geothermal water is poured back directly without pollution.
Comment: Coal-fired boilers are considered to be one of the main causes of haze in northern China in winter. Liang Zhipeng, deputy director of the New Energy Department of the National Energy Administration, said recently that in the process of the transformation of the energy structure and the mode of energy production and consumption, to promote heating supply may have more significant and direct impacts. Geothermal energy is the most important form of renewable energy heating. By 2020, geothermal heating should reach 1.6 billion square meters, with a net increase of 1.1 billion square meters. Among Listed companies, Zhejiang Kaishan Compressor Co., Ltd. (300257.SZ) owns a rich serious of advanced geothermal products and technologies. Yantai Moon Co., Ltd. (000811.SZ) can produce ground source heat pumps.
○ Major national science and technology project shifts to 5G, fully promote 5G R＆D
------
The Ministry of Science and Technology on Jan. 6 held a press conference on the major national science and technology project - "new generation of broadband wireless mobile communication network." It announced that the project will continue during the 13th Five-year Plan period, with its focus changing from 4G to 5G. The project will promote the formation of a unified 5G standard around the world, basically complete the research and development of 5G chips, terminals and system equipment and promote 5G to support the integrated and innovative development of mobile Internet and the Internet of Things, thus laying an industrial foundation for commercializing 5G in 2020 and making China one of the world leader in 5G.
Comment: China Securities expect that China will invest a total of 650 billion yuan in 5G network, up by over 60 percent from the investment in 4G. The main changes in 5G network will concentrate in base station, antenna on the terminal and RF and computing unit. It is bullish about main equipment leader ZTE Corporation (000063.SZ) and base station antenna leader Tongyu Communication Inc. (002792.SZ).
TOP
[Annoucement Interpretation]
○Bohai International Trust to get 15.13 pct. of equity of Longxing Chemical at RMB1.043 bln
------
Golden Eagle Fund Management Co., Ltd., second largest shareholder of Longxing Chemical Stock Co., Ltd. (002442.SZ), plans to transfer all of its 72,629,400 shares, accounting for 15.13 percent of the company's total share capital, to a capital trsut plan managed by Bohai International Trust Co., Ltd. at a price of 14.36 yuan per share (the latest closing price is 14.17 yuan per share). The transfer will be worth about 1.043 billion yuan. Bohai International Trust indicates that this transaction is financial investment.
○EVE Energy signed orders worth RMB1 bln with King Long Bus
------
EVE Energy Co., Ltd. (300014.SZ) recently signed strategic cooperation agreement with Nanjing King Long Bus Co., Ltd. According to the agreement, King Long Bus will buy power battery worth 1 billion yuan from the listed company in 2017. Operating revenues of EVE Energy recorded 1.349 billion yuan in 2015 and that in the first three quarters posted 1.448 billion yuan.
○Century Huatong Group expected to gain over 90 pct. equity of Shanda Games
------
Zhejiang Century Huatong Autotive Part Co., Ltd., controlling shareholder of Zhejiang Century Huatong Group Co., Ltd. (002602.SZ), plans to acquire 47.92 percent equity of Shanda Games Limited. This transaction will allow controlling shareholder and substantial shareholders of Century Huatong Group to hold 90.92 percent equity of Shanda Games indirectly. Century Huatong Group thinks that it has the rights to transfer 90.92 percent equity of Shanda Games to listed company. Shanda Games was delisted from Nasdaq Stock Market at the end of 2015.
○ Zhao Dongmei, spouse of the director of Sailun Jinyu Group Co., Ltd. (601058.SH), on Jan. 6 increased holding 6 million shares of the company at the consideration of 24.48 million yuan.
TOP
[Financial Reports Express]
○ Two companies proposes high share conversion and dividend
------
Loncin Motor Co., Ltd. (603766.SH) reported 13 percent growth in its annual report. The Board of directors has passed the distribution plan of 10-for-15 conversion of capital surplus into shares combined with 5 yuan divided for each 10 shares. Actual controller and controlling shareholder of Zhongzhu Healthcare Holding Co., Ltd. (600568.SH) propose 18-for-10 conversion of capital surplus into shares combined with 0.5 yuan dividend for each 10 shares in the annual report.
○ Several companies report performance growth
------
Guangdong Wen's Foodstuffs Group Co., Ltd. (300498.SZ) reported 83 percent to 104 percent growth in its annual report, primarily due to the growth of scale of its main business and the price hike of pork. Beijing Lanxum Technology Co., Ltd. (300010.SZ) reported 109 percent to 138 percent growth in its annual report, primarily due to consolidation of the financial statements of Kangbang Technology. Beijing Jetsen Technology Co., Ltd. (300182.SZ) reported 70 percent to 90 percent growth in its annual report, primarily due to the optimistic development of its main business. Beijing Miteno Communication Technology Co., Ltd. (300038.SZ) reported 90 percent to 120 percent growth in its annual report, primarily due to the consolidation of financial statements of Riyue Tongxing Information Technology (Beijing) Co., Ltd.
[Trading Alarm]
○ Three New shares offer for IPO on Jan. 9
------
Jack Sewing Machine Co., Ltd. (732337.SZ) will offer for subscription at 17.72 yuan per share. The upper limit for each applicant is 20,000 shares. The company is primarily engaged in sewing machine. Huakai Creative Co., ltd. (300592.SZ) will offer for subscription at 5.21 yuan per share. The upper limit for each applicant is 12,000 shares. The company is primarily involved in the design of exhibition hall. CVTE (002841.SZ) will offer for subscription at 19.06 yuan per share. The upper limit for each applicant is 11,500 shares. The company is primarily engaged in liquid crystal display (LCD) master card.
[Weekly Review]
○More information to provide based on main market trend
------
SSE index increased 1.63 percent last week, seeing a favorable performance at the beginning of 2017. But in terms of sector details, performance of individual stocks were very different, as stocks of state-owned enterprises reform (SOEs reform), increasing chemicals price, anti-inflation and other themes were continuously pursued by the market, but those related to sub-new shares and industrial chain of Apple Inc. were weak. Under this situation, it is undoubted to gain more yields from investment closely based on the main market trend.
It is lucky that we have gained some achievements for helping investors master the main market trend. In fact, "SOEs reform steps in deepening phase, and mixed ownership reform becomes a key direction for breakthroughs", [SSN Focus] of the last publication in 2016 pointed out; "China North Industries Group Corporation (CNIGC) releases opinions on mixed ownership reform", we also reported on Jan. 5 of this year. At the beginning of 2017, individual stocks related to railway mixed ownership reform and CNIGC subsidiaries become the main investment orientation for the market. Additionally, SSN will continue to closely follow up the information of the booming chemical industry. Besides repeatedly-stressed petrochemical industrial chain, we also reported on Jan. 3 that "price of sodium carbonate is raised in some regions", and related individual stocks, like Shandong Haihua Company Limited (000822.SZ), soared around 20 percent within one week.
Referring to recent attitude of regulatory authorities, the word "stability" will be constantly run through the whole year of 2017 for the capital market. With a premise that monetary policies are hard to ease and new shares are constantly supplied, structural trend may become a main market trend this year. In the future, SSN will consecutively report news closely related to the main market trend, and meanwhile, it will find potential market hotspots, and create bigger value for investors.
TOP
○ Gains supply-side reform to speed up, corn industry to see new opportunities
○ Geothermal energy to embrace great development, Major national science and technology project shifts to 5G
○ Bohai International Trust to get 15.13 pct. of equity of Longxing Chemical, EVE Energy signed orders worth RMB1 bln with King Long Bus
○ Two companies proposes high share conversion and dividend，several companies report performance growth
[SSN Focus]
○ Gains supply-side reform to speed up, corn industry to see new opportunities
------
The work conference on national grains circulation was held in Beijing from Jan. 7 to 8. It required advancing the reform in the corn purchase and storage system and speeding up in de-stocking of corns. It will cooperate in expanding the output of fuel ethanol and the application and support the processing and transformation of corns. In addition, it will deepen the reform of state-owned grains enterprises and actively develop the mixed ownership grain economy.
Comment: Securities companies believe that the seeding industry is a key area in the agricultural supply-side structural reform. As the restructuring and de-stocking complete, the profitability of the corn and other industries will improve. Shandong Denghai Seeds Co., Ltd. (002041.SZ) is a leader of corn seeds and its products are widely planted. COFCO Biochemical (Anhui) Co., Ltd. (000930.SZ) is principally engaged in fuel ethanol. It is a leader in the deep processing of corns. Its controller shareholder is COFCO.
[SSN Selection]
○ China Securities Regulatory Commission (CSRC) approved the IPO applications of 14 enterprises, including Chongqing Construction Engineering Group CO., Ltd. They will raise a total of no more than 4.8 billion yuan.
○ Many manufacturers released hardware products based on the Alexa of Amazon at the CES opened on Jan. 5
○ The quoted price of cobaltosic oxide products rose by nearly 10 percent on Jan. 6. Statistics show that the output of cathode materials of lithium batteries surged 43 percent year on year in 2016.
○Chengdu city, Sichuan province recently released its government work report, proposing to perfect urban non-motorized traffic system and support healthy development of sharing traffic like bike-sharing.
○Shanghai Municipal Commission of Housing and Urban-Rural Development announced on Jan. 7 that it will join hands with relevant departments to clear up and exam commercial office projects. During this period, online signing of contracts for such projects will be suspended during this period.
TOP
[Industry Information]
○Renewable energy enjoys advantages in heating, geothermal energy to embrace great development
------
CCTV News on Jan. 7 reported typical cases about that some places in the north part of China use renewable energy for clean heating. A housing estate in Zibo city, Shandong province circularly displaces the heat of underground soil (around 13 ℃) through three terrestrial heat pumps and then gathers the heat together for heating. Qingfeng county, Henan province pumps water from underground 2,000 meters and then heats it up for heating. The geothermal water is poured back directly without pollution.
Comment: Coal-fired boilers are considered to be one of the main causes of haze in northern China in winter. Liang Zhipeng, deputy director of the New Energy Department of the National Energy Administration, said recently that in the process of the transformation of the energy structure and the mode of energy production and consumption, to promote heating supply may have more significant and direct impacts. Geothermal energy is the most important form of renewable energy heating. By 2020, geothermal heating should reach 1.6 billion square meters, with a net increase of 1.1 billion square meters. Among Listed companies, Zhejiang Kaishan Compressor Co., Ltd. (300257.SZ) owns a rich serious of advanced geothermal products and technologies. Yantai Moon Co., Ltd. (000811.SZ) can produce ground source heat pumps.
○ Major national science and technology project shifts to 5G, fully promote 5G R＆D
------
The Ministry of Science and Technology on Jan. 6 held a press conference on the major national science and technology project - "new generation of broadband wireless mobile communication network." It announced that the project will continue during the 13th Five-year Plan period, with its focus changing from 4G to 5G. The project will promote the formation of a unified 5G standard around the world, basically complete the research and development of 5G chips, terminals and system equipment and promote 5G to support the integrated and innovative development of mobile Internet and the Internet of Things, thus laying an industrial foundation for commercializing 5G in 2020 and making China one of the world leader in 5G.
Comment: China Securities expect that China will invest a total of 650 billion yuan in 5G network, up by over 60 percent from the investment in 4G. The main changes in 5G network will concentrate in base station, antenna on the terminal and RF and computing unit. It is bullish about main equipment leader ZTE Corporation (000063.SZ) and base station antenna leader Tongyu Communication Inc. (002792.SZ).
TOP
[Annoucement Interpretation]
○Bohai International Trust to get 15.13 pct. of equity of Longxing Chemical at RMB1.043 bln
------
Golden Eagle Fund Management Co., Ltd., second largest shareholder of Longxing Chemical Stock Co., Ltd. (002442.SZ), plans to transfer all of its 72,629,400 shares, accounting for 15.13 percent of the company's total share capital, to a capital trsut plan managed by Bohai International Trust Co., Ltd. at a price of 14.36 yuan per share (the latest closing price is 14.17 yuan per share). The transfer will be worth about 1.043 billion yuan. Bohai International Trust indicates that this transaction is financial investment.
○EVE Energy signed orders worth RMB1 bln with King Long Bus
------
EVE Energy Co., Ltd. (300014.SZ) recently signed strategic cooperation agreement with Nanjing King Long Bus Co., Ltd. According to the agreement, King Long Bus will buy power battery worth 1 billion yuan from the listed company in 2017. Operating revenues of EVE Energy recorded 1.349 billion yuan in 2015 and that in the first three quarters posted 1.448 billion yuan.
○Century Huatong Group expected to gain over 90 pct. equity of Shanda Games
------
Zhejiang Century Huatong Autotive Part Co., Ltd., controlling shareholder of Zhejiang Century Huatong Group Co., Ltd. (002602.SZ), plans to acquire 47.92 percent equity of Shanda Games Limited. This transaction will allow controlling shareholder and substantial shareholders of Century Huatong Group to hold 90.92 percent equity of Shanda Games indirectly. Century Huatong Group thinks that it has the rights to transfer 90.92 percent equity of Shanda Games to listed company. Shanda Games was delisted from Nasdaq Stock Market at the end of 2015.
○ Zhao Dongmei, spouse of the director of Sailun Jinyu Group Co., Ltd. (601058.SH), on Jan. 6 increased holding 6 million shares of the company at the consideration of 24.48 million yuan.
TOP
[Financial Reports Express]
○ Two companies proposes high share conversion and dividend
------
Loncin Motor Co., Ltd. (603766.SH) reported 13 percent growth in its annual report. The Board of directors has passed the distribution plan of 10-for-15 conversion of capital surplus into shares combined with 5 yuan divided for each 10 shares. Actual controller and controlling shareholder of Zhongzhu Healthcare Holding Co., Ltd. (600568.SH) propose 18-for-10 conversion of capital surplus into shares combined with 0.5 yuan dividend for each 10 shares in the annual report.
○ Several companies report performance growth
------
Guangdong Wen's Foodstuffs Group Co., Ltd. (300498.SZ) reported 83 percent to 104 percent growth in its annual report, primarily due to the growth of scale of its main business and the price hike of pork. Beijing Lanxum Technology Co., Ltd. (300010.SZ) reported 109 percent to 138 percent growth in its annual report, primarily due to consolidation of the financial statements of Kangbang Technology. Beijing Jetsen Technology Co., Ltd. (300182.SZ) reported 70 percent to 90 percent growth in its annual report, primarily due to the optimistic development of its main business. Beijing Miteno Communication Technology Co., Ltd. (300038.SZ) reported 90 percent to 120 percent growth in its annual report, primarily due to the consolidation of financial statements of Riyue Tongxing Information Technology (Beijing) Co., Ltd.
[Trading Alarm]
○ Three New shares offer for IPO on Jan. 9
------
Jack Sewing Machine Co., Ltd. (732337.SZ) will offer for subscription at 17.72 yuan per share. The upper limit for each applicant is 20,000 shares. The company is primarily engaged in sewing machine. Huakai Creative Co., ltd. (300592.SZ) will offer for subscription at 5.21 yuan per share. The upper limit for each applicant is 12,000 shares. The company is primarily involved in the design of exhibition hall. CVTE (002841.SZ) will offer for subscription at 19.06 yuan per share. The upper limit for each applicant is 11,500 shares. The company is primarily engaged in liquid crystal display (LCD) master card.
[Weekly Review]
○More information to provide based on main market trend
------
SSE index increased 1.63 percent last week, seeing a favorable performance at the beginning of 2017. But in terms of sector details, performance of individual stocks were very different, as stocks of state-owned enterprises reform (SOEs reform), increasing chemicals price, anti-inflation and other themes were continuously pursued by the market, but those related to sub-new shares and industrial chain of Apple Inc. were weak. Under this situation, it is undoubted to gain more yields from investment closely based on the main market trend.
It is lucky that we have gained some achievements for helping investors master the main market trend. In fact, "SOEs reform steps in deepening phase, and mixed ownership reform becomes a key direction for breakthroughs", [SSN Focus] of the last publication in 2016 pointed out; "China North Industries Group Corporation (CNIGC) releases opinions on mixed ownership reform", we also reported on Jan. 5 of this year. At the beginning of 2017, individual stocks related to railway mixed ownership reform and CNIGC subsidiaries become the main investment orientation for the market. Additionally, SSN will continue to closely follow up the information of the booming chemical industry. Besides repeatedly-stressed petrochemical industrial chain, we also reported on Jan. 3 that "price of sodium carbonate is raised in some regions", and related individual stocks, like Shandong Haihua Company Limited (000822.SZ), soared around 20 percent within one week.
Referring to recent attitude of regulatory authorities, the word "stability" will be constantly run through the whole year of 2017 for the capital market. With a premise that monetary policies are hard to ease and new shares are constantly supplied, structural trend may become a main market trend this year. In the future, SSN will consecutively report news closely related to the main market trend, and meanwhile, it will find potential market hotspots, and create bigger value for investors.
TOP
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