[Today's Guide]
○ Policies support dairy supply-side reform, powder registration to improve supply and demand
○ Chenming Paper expects earnings to double, paper in short supply
○ Controlling shareholder of Maoye Communication and Network transfer equity at premium, Sichuan Langsha bought by Tibet Julang Technology to 5 pct again through secondary market acquisition
○ Zhongtai Chemical, Guangji Pharmaceutical and others announce great growth forecasts, Haili Metal One proposes high share conversion and dividend
[SSN Focus]
○ Policies support dairy supply-side reform, powder registration to improve supply and demand
------
The Ministry of Agriculture and the National Development and Reform Commission (NDRC) released the Plan on the Development of the Dairy Industry (2016-2020), proposing to make significant progresses in the modernization of the dairy industry and make substantial results in the supply-side structural reform in the dairy industry. It also proposed to implement the system on the administration of the registration of formula for powder products for infants and babies and promote the merger and reorganization of relevant enterprises. It will establish domestic brands of powder products for infants and babies with international influence and competitiveness.
Comment: Institutes pointed out that it is expected that the first batch of list in the powder registration system will be released in the second quarter. It will bring another 15 to 20 percent of market share with the elimination of inferior brands. Besides, the currently low inventory will bring a wave of demand for supplementing the inventory. Beingmate Baby ＆ Child Food Co., Ltd. (002570.SZ) is a leader in the domestic powder industry and institutes are rosy that its performance will recover. Inner Mongolia Yili Industrial Group Co., Ltd. (600887.SH) enjoys the biggest market share in the domestic powder market and competitive advantages in channels.
○ Xinjiang to promote state-owned assets reform through mixed ownership reform
------
The fifth meeting of the 12th session of the people's congress of Xinjiang Uygur Autonomous Region was held on Jan. 9. It is disclosed that the mixed ownership reform in state-owned assets reform was under hot discussion. It is reported that Xinjiang will make breakthroughs in mixed ownership reform and promote the state-owned enterprises and assets reform in 2017. It will further loosen the market entry of non-public ownership economies and eliminate all hidden barriers. It will focus on the modern enterprise system and make breakthroughs in the corporate governance structure, the pilot employee shareholding and classified reforms.
[SSN Selection]
○ The State Council recently released a circular in a recent effort to enhance medical reform during the 13th Five-Year Plan period (2016-2020), proposing to achieve new breakthroughs in the establishment of five systems which are hierarchical diagnosis and treatment, modern hospital management, national medical insurance, medicine supply guarantee and comprehensive supervision.
○ China's central bank on Jan. 9 conducted a net input of 70 billion yuan in the open market to support capital supply before the Spring Festival, ending the net withdrawal in previous four consecutive trading days.
○ The Ministry of Industry and Information Technology (MIIT) and the Ministry of Housing and Urban-Rural Development (MOHURD) released the interim standards and conditions for construction waste resource utilization industries, encouraging key industries to integrate industrial chain.
○ The rocket Kuaizhou-1A (KZ-1A) has successfully sent three satellites into space in its first commercial mission on Jan. 9.
○ Aero Engine Corporation of China held its 2017 annual meeting on Jan. 9, proposing to make great efforts in the development of key types of engines and the implementation of special plans for aero-engine and gas turbine.
TOP
[Industry Information]
○ Chenming Paper expects earnings to double, paper in short supply
------
Shandong Chenming Paper Holdings Limited (000488.SZ; 01812.HK) announced on Jan. 9 night that it expects its net profit to grow 90 to 110 percent year on year in 2016. It explains that it is because continuously rising prices of coated paper and ivory board benefiting from the supply side reform. Records of investors' relationship activities show that a great number of institutions investigated Shandong Sun Paper Industry Joint Stock Co., Ltd. (002078.SZ) and Zhejiang Jingxing Paper Joint Stock Co., Ltd. (002067.SZ). The two companies said that their products are now in short supply and inventories are low, and that their product prices will rise further at a faster pace than cost rise.
Comment: After years of eliminating capacity, those paper companies have become leaders with absolute right of speech. In recent years, the paper industry has seen limited new capacity and environmental factor has reduced market supply. Paper leaders are expected to see their profit improve in an upward cycle due to scale effect and pricing right.
○ Zhao Zhongxian and Tu Youyou win State Supreme Science and Technology Award
------
The National Science and Technology Award Conference was held in Beijing on Jan. 9. Zhao Zhongxian from the Institute of Physics, Chinese Academy of Sciences and Tu Youyou from China Academy of Chinese Medicine Sciences w0n the top Science and Technology Awards. The first prize of the State Natural Science Award falls on the new neutrino oscillation model discovered in a neutrino experiment in Daya Bay rector. The second prize of the State Natural Science Award falls on 41 results, including the "connection between the monsoon changes in Asia and the global climate". The first prize of the State Technical Invention Award falls on three results, including the "high-/super high-temperature coating materials technology and application".
◆The Beidou Navigation Satellite System (Beidou-2) was the outstanding winner of National Prize for Progress in Science and Technology. It is learnt from Test and Assessment Research Center of China Satellite Navigation Office by China News Service that China will finish launching about 18 global networking satellites around 2018, including 6-8 Beidou Navigation Satellites in 2017.
TOP
[Announcement Interpretation]
○ Controlling shareholder of Maoye Communication And Network transfers equity
------
Zhongzhao Investment Management Co., Ltd., controlling shareholder of Maoye Communication And Network Co., Ltd. (000889.SZ), singed agreement with Shenzhen Tongtaida Invesment Center (Limited Partnership) on Jan. 9 to transfer its 70 million shares of Maoye Communication and Network (accounting for 11.26 percent of the company's total share capital) at a price of 20 yuan per share. The deal will totally cost 1.4 billion yuan. The latest stock price closes at 15.59 yuan per share.
With the transaction done, shareholdings of Zhongzhao Investment Management and its persons acting in concert in Maoye Communication and Network decrease to 24.20 percent, lower than 28.35 percent equity held by Xiaochang Yingxigu Investment Center (Limited Partnership) and its persons in concert. So Zhongzhao Investment Management is no longer controlling shareholder of the listed company, and Xiaochang Yingxigu Investment Center becomes the company's biggest shareholder with 23.86 percent equity.
○ Sichuan Langsha bought by Tibet Julang Technology to 5 pct again through secondary market acquisition
------
Sichuan Langsha Holding Ltd. (600137.SH) bought by Tibet Julang Technology again through secondary acquisition in just a month. Information disclosure shows that Tibet Julang Technology has bought in 5 percent equities of the listed company from Dec. 19 2016 to Jan. 9, 2017. Previously from Nov. 3 to Dec. 13, 2016, Tibet Julang had bought in 4,861,900 shares of the company. So far, Tibet Julang Technology in total holds 9,721,800 shares of the company, representing 10 percent of its total share capital. Tibet Julang indicates that the acquisitions are financial investments, and it has no intention to obtain the actual controlling right of the company.
○ Ready Health Industry repurchases shares to launch ESOP
------
Xin Jiang Ready Health Industry Co., Ltd. (600090.SH) proposes to repurchase an estimated 6,666,700 shares (representing 0.46 percent of the total share capital) of the company at no more than 15 yuan per share with a total of 100 million yuan, which will be used as subject shares for its employee stock ownership plan (ESOP). The above repurchase price has a premium of 27.7 percent compared with the price before suspension of trading. The repurchasing period will last from the approval at the general meeting to June 30.
○ Largest shareholder of Nbtm New Materials decrease shareholding to motivate senior management team
------
Nbtm Metal, largest shareholder of Nbtm New Materials Group Co., Ltd. (600114.SH), proposes to transfer 22.3 million shares (representing 5.24 percent of the total share capital) of the company held by it to the senior management shareholding platform, to motivate the management team. The transfer price is 15.42 yuan per share, 90 percent of the company's price before suspension of trading. Upon completion of the transaction, the shareholding percentage of Nbtm Metal in the listed company will be reduced to 14.21 percent. The listed company still has no sole controller.
TOP
[Financial Reports Express]
○ Zhongtai Chemical, Guangji Pharmaceutical and others announce great growth forecasts
------
Xinjiang Zhongtai Chemical Co., Ltd. (002092.SZ) increases its performance growth forecast to 22,697 percent to 24,651 percent according to annual report, mainly due to market price uptrend of its main products, such as PVC, viscose and yarn; growth forecast of 593 percent to 641 percent for Hubei Guangji Pharmaceutical Co., Ltd. (000952.SZ), mainly due to increase of product sales price and decline of raw materials cost; that for Sinosteel Anhui Tianyuan Technology Co., Ltd. (002057.SZ) is raised to 80 percent to 130 percent, mainly due to massive compensations for demolition; 179 percent to 263 percent for Guangdong Sky Dragon Printing Ink Group Co., Ltd. (300063.SZ), mainly due to combined financial statement with Beijing Unique Advertisement Co., Ltd.
○ Haili Metal One proposes high share conversion and dividend
------
The controlling shareholder of Qingdao Haili Metal One Co., Ltd. (002537.SZ) proposes a pre-scheme of 12-for-10 conversion of capital surplus into shares combined with 0.5 yuan dividend for every 10 shares according to its annual report.
[Trading Alarms]
○ IPOs of Carthane, Eddie Precision Machinery and Bichamp Cutting Technology on Jan. 10
------
Shanghai Carthane Co., Ltd. (732037.SH) is mainly engaged in car damping components, with an offering price of 16.01 yuan per share and upper subscription limit of 20,000 shares; hydraulic pressure products, 6.58 yuan per share and 17,000 shares for Yantai Eddie Precision Machinery Co., Ltd. (732638.SH); double-metal-strap saw, 6.08 yuan per share and 14,000 shares for Bichamp Cutting Technology (Hunan) Co., Ltd. (002843.SZ).
TOP
○ Policies support dairy supply-side reform, powder registration to improve supply and demand
○ Chenming Paper expects earnings to double, paper in short supply
○ Controlling shareholder of Maoye Communication and Network transfer equity at premium, Sichuan Langsha bought by Tibet Julang Technology to 5 pct again through secondary market acquisition
○ Zhongtai Chemical, Guangji Pharmaceutical and others announce great growth forecasts, Haili Metal One proposes high share conversion and dividend
[SSN Focus]
○ Policies support dairy supply-side reform, powder registration to improve supply and demand
------
The Ministry of Agriculture and the National Development and Reform Commission (NDRC) released the Plan on the Development of the Dairy Industry (2016-2020), proposing to make significant progresses in the modernization of the dairy industry and make substantial results in the supply-side structural reform in the dairy industry. It also proposed to implement the system on the administration of the registration of formula for powder products for infants and babies and promote the merger and reorganization of relevant enterprises. It will establish domestic brands of powder products for infants and babies with international influence and competitiveness.
Comment: Institutes pointed out that it is expected that the first batch of list in the powder registration system will be released in the second quarter. It will bring another 15 to 20 percent of market share with the elimination of inferior brands. Besides, the currently low inventory will bring a wave of demand for supplementing the inventory. Beingmate Baby ＆ Child Food Co., Ltd. (002570.SZ) is a leader in the domestic powder industry and institutes are rosy that its performance will recover. Inner Mongolia Yili Industrial Group Co., Ltd. (600887.SH) enjoys the biggest market share in the domestic powder market and competitive advantages in channels.
○ Xinjiang to promote state-owned assets reform through mixed ownership reform
------
The fifth meeting of the 12th session of the people's congress of Xinjiang Uygur Autonomous Region was held on Jan. 9. It is disclosed that the mixed ownership reform in state-owned assets reform was under hot discussion. It is reported that Xinjiang will make breakthroughs in mixed ownership reform and promote the state-owned enterprises and assets reform in 2017. It will further loosen the market entry of non-public ownership economies and eliminate all hidden barriers. It will focus on the modern enterprise system and make breakthroughs in the corporate governance structure, the pilot employee shareholding and classified reforms.
[SSN Selection]
○ The State Council recently released a circular in a recent effort to enhance medical reform during the 13th Five-Year Plan period (2016-2020), proposing to achieve new breakthroughs in the establishment of five systems which are hierarchical diagnosis and treatment, modern hospital management, national medical insurance, medicine supply guarantee and comprehensive supervision.
○ China's central bank on Jan. 9 conducted a net input of 70 billion yuan in the open market to support capital supply before the Spring Festival, ending the net withdrawal in previous four consecutive trading days.
○ The Ministry of Industry and Information Technology (MIIT) and the Ministry of Housing and Urban-Rural Development (MOHURD) released the interim standards and conditions for construction waste resource utilization industries, encouraging key industries to integrate industrial chain.
○ The rocket Kuaizhou-1A (KZ-1A) has successfully sent three satellites into space in its first commercial mission on Jan. 9.
○ Aero Engine Corporation of China held its 2017 annual meeting on Jan. 9, proposing to make great efforts in the development of key types of engines and the implementation of special plans for aero-engine and gas turbine.
TOP
[Industry Information]
○ Chenming Paper expects earnings to double, paper in short supply
------
Shandong Chenming Paper Holdings Limited (000488.SZ; 01812.HK) announced on Jan. 9 night that it expects its net profit to grow 90 to 110 percent year on year in 2016. It explains that it is because continuously rising prices of coated paper and ivory board benefiting from the supply side reform. Records of investors' relationship activities show that a great number of institutions investigated Shandong Sun Paper Industry Joint Stock Co., Ltd. (002078.SZ) and Zhejiang Jingxing Paper Joint Stock Co., Ltd. (002067.SZ). The two companies said that their products are now in short supply and inventories are low, and that their product prices will rise further at a faster pace than cost rise.
Comment: After years of eliminating capacity, those paper companies have become leaders with absolute right of speech. In recent years, the paper industry has seen limited new capacity and environmental factor has reduced market supply. Paper leaders are expected to see their profit improve in an upward cycle due to scale effect and pricing right.
○ Zhao Zhongxian and Tu Youyou win State Supreme Science and Technology Award
------
The National Science and Technology Award Conference was held in Beijing on Jan. 9. Zhao Zhongxian from the Institute of Physics, Chinese Academy of Sciences and Tu Youyou from China Academy of Chinese Medicine Sciences w0n the top Science and Technology Awards. The first prize of the State Natural Science Award falls on the new neutrino oscillation model discovered in a neutrino experiment in Daya Bay rector. The second prize of the State Natural Science Award falls on 41 results, including the "connection between the monsoon changes in Asia and the global climate". The first prize of the State Technical Invention Award falls on three results, including the "high-/super high-temperature coating materials technology and application".
◆The Beidou Navigation Satellite System (Beidou-2) was the outstanding winner of National Prize for Progress in Science and Technology. It is learnt from Test and Assessment Research Center of China Satellite Navigation Office by China News Service that China will finish launching about 18 global networking satellites around 2018, including 6-8 Beidou Navigation Satellites in 2017.
TOP
[Announcement Interpretation]
○ Controlling shareholder of Maoye Communication And Network transfers equity
------
Zhongzhao Investment Management Co., Ltd., controlling shareholder of Maoye Communication And Network Co., Ltd. (000889.SZ), singed agreement with Shenzhen Tongtaida Invesment Center (Limited Partnership) on Jan. 9 to transfer its 70 million shares of Maoye Communication and Network (accounting for 11.26 percent of the company's total share capital) at a price of 20 yuan per share. The deal will totally cost 1.4 billion yuan. The latest stock price closes at 15.59 yuan per share.
With the transaction done, shareholdings of Zhongzhao Investment Management and its persons acting in concert in Maoye Communication and Network decrease to 24.20 percent, lower than 28.35 percent equity held by Xiaochang Yingxigu Investment Center (Limited Partnership) and its persons in concert. So Zhongzhao Investment Management is no longer controlling shareholder of the listed company, and Xiaochang Yingxigu Investment Center becomes the company's biggest shareholder with 23.86 percent equity.
○ Sichuan Langsha bought by Tibet Julang Technology to 5 pct again through secondary market acquisition
------
Sichuan Langsha Holding Ltd. (600137.SH) bought by Tibet Julang Technology again through secondary acquisition in just a month. Information disclosure shows that Tibet Julang Technology has bought in 5 percent equities of the listed company from Dec. 19 2016 to Jan. 9, 2017. Previously from Nov. 3 to Dec. 13, 2016, Tibet Julang had bought in 4,861,900 shares of the company. So far, Tibet Julang Technology in total holds 9,721,800 shares of the company, representing 10 percent of its total share capital. Tibet Julang indicates that the acquisitions are financial investments, and it has no intention to obtain the actual controlling right of the company.
○ Ready Health Industry repurchases shares to launch ESOP
------
Xin Jiang Ready Health Industry Co., Ltd. (600090.SH) proposes to repurchase an estimated 6,666,700 shares (representing 0.46 percent of the total share capital) of the company at no more than 15 yuan per share with a total of 100 million yuan, which will be used as subject shares for its employee stock ownership plan (ESOP). The above repurchase price has a premium of 27.7 percent compared with the price before suspension of trading. The repurchasing period will last from the approval at the general meeting to June 30.
○ Largest shareholder of Nbtm New Materials decrease shareholding to motivate senior management team
------
Nbtm Metal, largest shareholder of Nbtm New Materials Group Co., Ltd. (600114.SH), proposes to transfer 22.3 million shares (representing 5.24 percent of the total share capital) of the company held by it to the senior management shareholding platform, to motivate the management team. The transfer price is 15.42 yuan per share, 90 percent of the company's price before suspension of trading. Upon completion of the transaction, the shareholding percentage of Nbtm Metal in the listed company will be reduced to 14.21 percent. The listed company still has no sole controller.
TOP
[Financial Reports Express]
○ Zhongtai Chemical, Guangji Pharmaceutical and others announce great growth forecasts
------
Xinjiang Zhongtai Chemical Co., Ltd. (002092.SZ) increases its performance growth forecast to 22,697 percent to 24,651 percent according to annual report, mainly due to market price uptrend of its main products, such as PVC, viscose and yarn; growth forecast of 593 percent to 641 percent for Hubei Guangji Pharmaceutical Co., Ltd. (000952.SZ), mainly due to increase of product sales price and decline of raw materials cost; that for Sinosteel Anhui Tianyuan Technology Co., Ltd. (002057.SZ) is raised to 80 percent to 130 percent, mainly due to massive compensations for demolition; 179 percent to 263 percent for Guangdong Sky Dragon Printing Ink Group Co., Ltd. (300063.SZ), mainly due to combined financial statement with Beijing Unique Advertisement Co., Ltd.
○ Haili Metal One proposes high share conversion and dividend
------
The controlling shareholder of Qingdao Haili Metal One Co., Ltd. (002537.SZ) proposes a pre-scheme of 12-for-10 conversion of capital surplus into shares combined with 0.5 yuan dividend for every 10 shares according to its annual report.
[Trading Alarms]
○ IPOs of Carthane, Eddie Precision Machinery and Bichamp Cutting Technology on Jan. 10
------
Shanghai Carthane Co., Ltd. (732037.SH) is mainly engaged in car damping components, with an offering price of 16.01 yuan per share and upper subscription limit of 20,000 shares; hydraulic pressure products, 6.58 yuan per share and 17,000 shares for Yantai Eddie Precision Machinery Co., Ltd. (732638.SH); double-metal-strap saw, 6.08 yuan per share and 14,000 shares for Bichamp Cutting Technology (Hunan) Co., Ltd. (002843.SZ).
TOP
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