[Today's Guide]
○ SASAC set tasks in SOEs reform, mixed ownership reform and overall listing to speed up
○ Plan on transformation and upgrading of ship industry released, construction of information infrastructure to embrace investment with RMB1 trln
○ Lingyun Industrial Corporation to buy military assets at RMB1.289 bln, actual controller of EGing Photovoltaic Technology to transfer equities
○ Shenzhen Metro to acquire equities of China Vanke held by China Resources with premiums, Dear-Hanyu Electrical Joint-Stock proposes high share conversion and dividend
[SSN Focus]
○ SASAC set tasks in SOEs reform, mixed ownership reform and overall listing to speed up
------
The meeting of responsible persons of central enterprises and local state-owned assets supervision and administration commissions (SASACs) was held on Jan. 12. It proposed to fully advance the classified reform of central enterprises, deeply promote the corporate and mixed ownership reform and actively explore diversified equity reform of groups. It will complete the corporate reform of SOEs, encourage cross-shareholding among central enterprises and local SOEs and advance the restructuring and listing to make breakthroughs in mixed ownership reform. It will make substantial progresses in power, oil, natural gas, railway, civil aviation, telecommunication and military engineering industries and focus on the pilot employee shareholding in 10 central enterprises with mixed ownership.
Comment: 2017 is crucial in SOEs reform and the mixed ownership reform will see breakthroughs. Many central enterprises in the key major industries proposed by the SASAC have initiated the mixed ownership reform. China National Petroleum Corporation and China North Industries Group Corporation (Norinco Group) have released the guidance on mixed ownership reform. It is reported that the classification of SOEs' functions has been completed and will be released soon. It means that the mixed ownership on the basis of classification will speed up. The meeting also highlighted the diversified equities and the restructuring for listing. The overall listing of central enterprises will speed up.
◆ The State Development ＆ Investment Corporation (SDIC) held the work conference for 2017 recently. It proposed to fully advance pilot reforms and grant classified authorizations to 11 subsidies, including SDIC Power Holdings Co., Ltd. (600886.SH). It also chose SDIC Power Holdings to conduct the pilot reform on professional managers. The asset management business of SDIC exceeded 1 trillion yuan last year. It will build a financial control platform.
○ SSF initiates bidding, basic pension insurance fund to invested in securities market around Spring Festival at the soonest
------
SSN learnt that substantial progress has been achieved again for the investment of basic pension insurance fund in the securities market. China's National Council for Social Security Fund (SSF) officially initiated the bidding process in early January and shortlisted institutions will be further selected from four directions, which are stock, bond, cash and quantification. Up to now, the bidding in some directions has nearly been completed. Industry insiders estimate that according to current progress, at the soonest, the account opening and fund appropriation for the securities investment and management accounts of some basic pension insurance fund can be done before the Spring Festival, while most of the basic pension insurance fund will be invested in the securities market after the Spring Festival.
[SSN Selection]
○ As indicated by the China Financial Futures Exchange (CFFEX) on Jan. 12, it noticed that some media reported that there will be some changes about the trading rules of the stock index futures. The CFFEX has always been working on the research and proof of relevant work, trying to make stock index futures play a positive role in the market.
○ Data from China's central bank shows that 1.04 trillion yuan was added to the RMB loans in December 2016, representing a year-on-year growth of 446.6 billion yuan.
○ An inspection team of the State Council focusing on obsoleting outdated capacity in iron ＆ steel and coal industries went to Shanxi province for supervision. It is required that the resurgence of outdated capacity must be completely walled up.
○ The General Office of the State Council recently released the Guidance on Constructing the Technology System of "Internet plus Government Affairs Services". Such move aims to build a unified data sharing and exchanging platform.
○ The national insurance regulation work conference held on Jan. 12 required advance three strategies and put the "prevention and control of risks" in the first place.
TOP
[Industry Information]
○ Plan on transformation and upgrading of ship industry released, supports conversion of civil and military technologies
------
The Ministry of Industry and Information Technology (MIIT) and the National Development and Reform Commission (NDRC) recently issued the action plan on deepening the structural adjustment and accelerating the transformation and upgrading of the ship industry (from 2016-2020). The plan proposes that by 2020, China should reach the world advanced level in high-tech ship and marine engineering equipment concepts/infrastructure and fully grasp core technologies in ship power, deck machinery, cabin equipment, communication and navigation and intelligent system and equipment. China should further strengthen researches on the conversion of military technology for civil use as well as the technology for both civil and military use and support two-way conversion of civil and military technologies.
Comment: Xin Guobin, vice-minister of the MIIT said that the conversion of mature and stable military technology for civil use will give powerful impetus to the economic and social development, cultivate new industrial form and form new economic growth point. Enterprises with military ship technologies are expected to open wider market by converting military technologies for civil use. Xiangtan Electric Manufacturing Co., Ltd. (600416.SH) plans to build a research system and production base for naval vessel power-driven system. CSSC Offshore ＆ Marine Engineering (Group) Company Limited (600685.SH; 00317.HK) has developed the military ship file by acquiring CSSC Guangzhou Huangpu Shipbuilding Co., Ltd.
○ Construction of information infrastructure to embrace investment with RMB1 trln, optical communication market to keep high prosperity
------
National Development and Reform Commission and Ministry of Industry and Information Technology issued 3-year action plan on major projects of information infrastructure. They put forward that by 2018, the length of fiber optic trunk cable will increase 90,000 kilometers and the number of terminal of fiber to the home will be added by 200 million; 2 million 4G base stations will be added so as to realize full coverage of 4G network in towns and densely populated administrative villages, and more than 75 percent of houses use mobile broadband. In order to ensure achievement of task and goal, 1.2 trillion yuan needs to be invested in construction of information infrastructure during 2016 and 2018.
Comment: Institutions think that driven by development and upgrading of fixed network broadband and demand for data center, optical communication market will keep high prosperity in 2017. Hengtong Optic-electric Co., Ltd. (600487.SH) has the ability to produce optical wand, optical fiber, optical cable and optical distribution network. Accelink Technologies Co., Ltd. (002281.SZ) is engaged in development and manufacturing of optoelectronic device of optical communication field.
TOP
[Announcement Interpretation]
○ Lingyun Industrial Corporation to buy military assets at RMB1.289 bln
------
Lingyun Industrial Corporation Limited (600480.SH) plans to purchase 100 percent equity of CNGG Hebei Taihang Machinery Industries Co., Ltd. held by North Lingyun Industrial Group Co., Ltd. by issuing 110 million stocks at a price of 11.63 yuan per share through private placement. It will also acquire 100 percent equity of OLinkStar Co., Ltd. held by several institutes and companies and 8 natural persons at a total cost of 1.289 billion yuan. The appreciation ratio is estimated to be 266.42 percent. Meanwhile, the company plans to raise 236 million yuan at most by issuing 18,055,900 shares to North Lingyun Industrial Group and North Industries Group Investment Management Company Ltd. at a price of 13.05 yuan per share through private placement. Via this acquisition, the company's new business will include parts and components of launcher of light rocket (missile) and rail transit cars, chips for Beidou Navigation and other military and civil products.
○ Actual controller of EGing Photovoltaic Technology to transfer 7.59 pct equities with great premiums
------
Xun Jianhua, actual controller of EGing Photovoltaic Technology Co., Ltd. (600537.SH), plans to transfer his held 89.28 million shares (7.59 percent equities) to Keenstar Investment Co., Ltd., and the transaction price totals at 1.5 billion yuan, including specialized compensation of 695 million yuan for Xun to make up the profit of the listed company. After equity transfer, Xun's shareholding proportion will reduce to 22.77 percent.
Based on calculation of 1.5 billion yuan, Keenstar Investment will cost around 16.8 yuan per share to invest in the listed company this time, with a premium of 126 percent compared to the stock price of 7.43 yuan per share before the trading suspension. Keenstar Investment indicated it is optimistic on PV industrial development prospect of China, and this move could help it step into new energy sector.
TOP
○ Shenzhen Metro to acquire equities of China Vanke held by China Resources with premiums
------
China Resources (Holdings) Co., Ltd. proposes to transfer its held 15.31 percent equities of China Vanke Co., Ltd. (000002.SZ) to Shenzhen Metro Group Co., Ltd., and the transaction price is 22 yuan per share, higher than China Vanke's stock price of 20.4 yuan per share before the trading suspension. After the transaction, State-owned Assets Supervision and Administration Commission of Shenzhen Municipality and its "allies" (management of China Vanke, Evergrande Group and etc.) will hold a total shareholdings more than those held by Baoneng Group.
○ Controlling shareholder of Changjiu Biochemical Industry to publically transfer equities
------
Jiangxi Changjiu Chemical Group Co., Ltd., controlling shareholder of Jiangxi Changjiu Biochemical Industry Co., Ltd. (600228.SH), plans to transfer its held 99.58 percent equities through Jiangxi Assets and Equity Exchange. Currently, the system reform of Changjiu Chemical Group has not been fully finished yet, Changjiu Biochemical Industry indicated.
○ Mizuda Printing＆ Dyeing Group proposes to acquire Wangneng Energy with RMB4.25 bln
------
Zhejiang Mizuda Printing＆ Dyeing Group Co., Ltd. (002034.SZ) proposes to acquire the entire equities of Zhejiang Wangneng Energy Co., Ltd. at the valuation of 4.25 billion yuan. It plans to purchase the assets by issuing shares at 31.34 yuan per share through private placement. At the same time, the company proposes to raise supporting fund of 1.5 billion yuan at no less than 31.6 yuan per share. Wangneng Energy is a leading player in the waste to energy (WTE) industry. Its committed net profits deducted of non-recurring profit or loss for 2017, 2018 and 2019 will be no less than 240 million yuan, 300 million yuan and 400 million yuan respectively.
[Financial Reports Express]
○ Dear-Hanyu Electrical Joint-Stock proposes high share conversion and dividend
------
Jiangmen iDear-Hanyu Electrical Joint-Stock Co., Ltd. (300403.SZ) expects 26 percent to 36 percent growth in the annual report. Its actual controller proposes 15-for-10 conversion of capital surplus into shares. Shenzhen Ysstech Info-Tech Co., Ltd. (300377.SZ) expects its results to double in the annual report. Its actual controller proposes 30-for-10 conversion of capital surplus in to shares combined with 2 yuan dividend for each 10 shares. Its shareholder will reduce shareholding.
○ Nanshan Power turns losses into gains
------
Shenzhen Nanshan Power Co., Ltd. (000037.SZ) reports profit of 1.3 billion yuan in the annual report and turned losses into gains, primarily due to disposal of the equity rights of its subsidiary. Hisense Kelon Electrical Holdings Co., Ltd. (000921.SZ) forecasts 80 percent to 100 percent growth in its annual report, primarily due to revenue growth. Shenzhen Yinghe Technology Co., Ltd. (300457.SZ) forecasts 86 percent to 116 percent growth in the annual report, primarily due to the rapid development of composite quartz business.
[Trading Alarm]
○ Three new shares offer for subscription on Jan. 13
------
Huada Automotive Technology Co., Ltd. (732358.SZ) will offer subscription at 31.18 yuan per share. The upper limit for each applicant is 16,000 shares. The company is primarily engaged in auto parts. Eurocrane Co., Ltd. (732966.SZ) will offer for subscription at 7.32 yuan per share. The upper limit for each applicant is 16,000 shares. The company is primarily engaged in hoisting machinery. Shenzhen Tongxingda Technology Co., Ltd. (002845.SZ) will offer for subscription at 15.99 yuan per share. The upper limit for each applicant is 9,500 shares. The company is primarily involved in LCD module.
TOP
○ SASAC set tasks in SOEs reform, mixed ownership reform and overall listing to speed up
○ Plan on transformation and upgrading of ship industry released, construction of information infrastructure to embrace investment with RMB1 trln
○ Lingyun Industrial Corporation to buy military assets at RMB1.289 bln, actual controller of EGing Photovoltaic Technology to transfer equities
○ Shenzhen Metro to acquire equities of China Vanke held by China Resources with premiums, Dear-Hanyu Electrical Joint-Stock proposes high share conversion and dividend
[SSN Focus]
○ SASAC set tasks in SOEs reform, mixed ownership reform and overall listing to speed up
------
The meeting of responsible persons of central enterprises and local state-owned assets supervision and administration commissions (SASACs) was held on Jan. 12. It proposed to fully advance the classified reform of central enterprises, deeply promote the corporate and mixed ownership reform and actively explore diversified equity reform of groups. It will complete the corporate reform of SOEs, encourage cross-shareholding among central enterprises and local SOEs and advance the restructuring and listing to make breakthroughs in mixed ownership reform. It will make substantial progresses in power, oil, natural gas, railway, civil aviation, telecommunication and military engineering industries and focus on the pilot employee shareholding in 10 central enterprises with mixed ownership.
Comment: 2017 is crucial in SOEs reform and the mixed ownership reform will see breakthroughs. Many central enterprises in the key major industries proposed by the SASAC have initiated the mixed ownership reform. China National Petroleum Corporation and China North Industries Group Corporation (Norinco Group) have released the guidance on mixed ownership reform. It is reported that the classification of SOEs' functions has been completed and will be released soon. It means that the mixed ownership on the basis of classification will speed up. The meeting also highlighted the diversified equities and the restructuring for listing. The overall listing of central enterprises will speed up.
◆ The State Development ＆ Investment Corporation (SDIC) held the work conference for 2017 recently. It proposed to fully advance pilot reforms and grant classified authorizations to 11 subsidies, including SDIC Power Holdings Co., Ltd. (600886.SH). It also chose SDIC Power Holdings to conduct the pilot reform on professional managers. The asset management business of SDIC exceeded 1 trillion yuan last year. It will build a financial control platform.
○ SSF initiates bidding, basic pension insurance fund to invested in securities market around Spring Festival at the soonest
------
SSN learnt that substantial progress has been achieved again for the investment of basic pension insurance fund in the securities market. China's National Council for Social Security Fund (SSF) officially initiated the bidding process in early January and shortlisted institutions will be further selected from four directions, which are stock, bond, cash and quantification. Up to now, the bidding in some directions has nearly been completed. Industry insiders estimate that according to current progress, at the soonest, the account opening and fund appropriation for the securities investment and management accounts of some basic pension insurance fund can be done before the Spring Festival, while most of the basic pension insurance fund will be invested in the securities market after the Spring Festival.
[SSN Selection]
○ As indicated by the China Financial Futures Exchange (CFFEX) on Jan. 12, it noticed that some media reported that there will be some changes about the trading rules of the stock index futures. The CFFEX has always been working on the research and proof of relevant work, trying to make stock index futures play a positive role in the market.
○ Data from China's central bank shows that 1.04 trillion yuan was added to the RMB loans in December 2016, representing a year-on-year growth of 446.6 billion yuan.
○ An inspection team of the State Council focusing on obsoleting outdated capacity in iron ＆ steel and coal industries went to Shanxi province for supervision. It is required that the resurgence of outdated capacity must be completely walled up.
○ The General Office of the State Council recently released the Guidance on Constructing the Technology System of "Internet plus Government Affairs Services". Such move aims to build a unified data sharing and exchanging platform.
○ The national insurance regulation work conference held on Jan. 12 required advance three strategies and put the "prevention and control of risks" in the first place.
TOP
[Industry Information]
○ Plan on transformation and upgrading of ship industry released, supports conversion of civil and military technologies
------
The Ministry of Industry and Information Technology (MIIT) and the National Development and Reform Commission (NDRC) recently issued the action plan on deepening the structural adjustment and accelerating the transformation and upgrading of the ship industry (from 2016-2020). The plan proposes that by 2020, China should reach the world advanced level in high-tech ship and marine engineering equipment concepts/infrastructure and fully grasp core technologies in ship power, deck machinery, cabin equipment, communication and navigation and intelligent system and equipment. China should further strengthen researches on the conversion of military technology for civil use as well as the technology for both civil and military use and support two-way conversion of civil and military technologies.
Comment: Xin Guobin, vice-minister of the MIIT said that the conversion of mature and stable military technology for civil use will give powerful impetus to the economic and social development, cultivate new industrial form and form new economic growth point. Enterprises with military ship technologies are expected to open wider market by converting military technologies for civil use. Xiangtan Electric Manufacturing Co., Ltd. (600416.SH) plans to build a research system and production base for naval vessel power-driven system. CSSC Offshore ＆ Marine Engineering (Group) Company Limited (600685.SH; 00317.HK) has developed the military ship file by acquiring CSSC Guangzhou Huangpu Shipbuilding Co., Ltd.
○ Construction of information infrastructure to embrace investment with RMB1 trln, optical communication market to keep high prosperity
------
National Development and Reform Commission and Ministry of Industry and Information Technology issued 3-year action plan on major projects of information infrastructure. They put forward that by 2018, the length of fiber optic trunk cable will increase 90,000 kilometers and the number of terminal of fiber to the home will be added by 200 million; 2 million 4G base stations will be added so as to realize full coverage of 4G network in towns and densely populated administrative villages, and more than 75 percent of houses use mobile broadband. In order to ensure achievement of task and goal, 1.2 trillion yuan needs to be invested in construction of information infrastructure during 2016 and 2018.
Comment: Institutions think that driven by development and upgrading of fixed network broadband and demand for data center, optical communication market will keep high prosperity in 2017. Hengtong Optic-electric Co., Ltd. (600487.SH) has the ability to produce optical wand, optical fiber, optical cable and optical distribution network. Accelink Technologies Co., Ltd. (002281.SZ) is engaged in development and manufacturing of optoelectronic device of optical communication field.
TOP
[Announcement Interpretation]
○ Lingyun Industrial Corporation to buy military assets at RMB1.289 bln
------
Lingyun Industrial Corporation Limited (600480.SH) plans to purchase 100 percent equity of CNGG Hebei Taihang Machinery Industries Co., Ltd. held by North Lingyun Industrial Group Co., Ltd. by issuing 110 million stocks at a price of 11.63 yuan per share through private placement. It will also acquire 100 percent equity of OLinkStar Co., Ltd. held by several institutes and companies and 8 natural persons at a total cost of 1.289 billion yuan. The appreciation ratio is estimated to be 266.42 percent. Meanwhile, the company plans to raise 236 million yuan at most by issuing 18,055,900 shares to North Lingyun Industrial Group and North Industries Group Investment Management Company Ltd. at a price of 13.05 yuan per share through private placement. Via this acquisition, the company's new business will include parts and components of launcher of light rocket (missile) and rail transit cars, chips for Beidou Navigation and other military and civil products.
○ Actual controller of EGing Photovoltaic Technology to transfer 7.59 pct equities with great premiums
------
Xun Jianhua, actual controller of EGing Photovoltaic Technology Co., Ltd. (600537.SH), plans to transfer his held 89.28 million shares (7.59 percent equities) to Keenstar Investment Co., Ltd., and the transaction price totals at 1.5 billion yuan, including specialized compensation of 695 million yuan for Xun to make up the profit of the listed company. After equity transfer, Xun's shareholding proportion will reduce to 22.77 percent.
Based on calculation of 1.5 billion yuan, Keenstar Investment will cost around 16.8 yuan per share to invest in the listed company this time, with a premium of 126 percent compared to the stock price of 7.43 yuan per share before the trading suspension. Keenstar Investment indicated it is optimistic on PV industrial development prospect of China, and this move could help it step into new energy sector.
TOP
○ Shenzhen Metro to acquire equities of China Vanke held by China Resources with premiums
------
China Resources (Holdings) Co., Ltd. proposes to transfer its held 15.31 percent equities of China Vanke Co., Ltd. (000002.SZ) to Shenzhen Metro Group Co., Ltd., and the transaction price is 22 yuan per share, higher than China Vanke's stock price of 20.4 yuan per share before the trading suspension. After the transaction, State-owned Assets Supervision and Administration Commission of Shenzhen Municipality and its "allies" (management of China Vanke, Evergrande Group and etc.) will hold a total shareholdings more than those held by Baoneng Group.
○ Controlling shareholder of Changjiu Biochemical Industry to publically transfer equities
------
Jiangxi Changjiu Chemical Group Co., Ltd., controlling shareholder of Jiangxi Changjiu Biochemical Industry Co., Ltd. (600228.SH), plans to transfer its held 99.58 percent equities through Jiangxi Assets and Equity Exchange. Currently, the system reform of Changjiu Chemical Group has not been fully finished yet, Changjiu Biochemical Industry indicated.
○ Mizuda Printing＆ Dyeing Group proposes to acquire Wangneng Energy with RMB4.25 bln
------
Zhejiang Mizuda Printing＆ Dyeing Group Co., Ltd. (002034.SZ) proposes to acquire the entire equities of Zhejiang Wangneng Energy Co., Ltd. at the valuation of 4.25 billion yuan. It plans to purchase the assets by issuing shares at 31.34 yuan per share through private placement. At the same time, the company proposes to raise supporting fund of 1.5 billion yuan at no less than 31.6 yuan per share. Wangneng Energy is a leading player in the waste to energy (WTE) industry. Its committed net profits deducted of non-recurring profit or loss for 2017, 2018 and 2019 will be no less than 240 million yuan, 300 million yuan and 400 million yuan respectively.
[Financial Reports Express]
○ Dear-Hanyu Electrical Joint-Stock proposes high share conversion and dividend
------
Jiangmen iDear-Hanyu Electrical Joint-Stock Co., Ltd. (300403.SZ) expects 26 percent to 36 percent growth in the annual report. Its actual controller proposes 15-for-10 conversion of capital surplus into shares. Shenzhen Ysstech Info-Tech Co., Ltd. (300377.SZ) expects its results to double in the annual report. Its actual controller proposes 30-for-10 conversion of capital surplus in to shares combined with 2 yuan dividend for each 10 shares. Its shareholder will reduce shareholding.
○ Nanshan Power turns losses into gains
------
Shenzhen Nanshan Power Co., Ltd. (000037.SZ) reports profit of 1.3 billion yuan in the annual report and turned losses into gains, primarily due to disposal of the equity rights of its subsidiary. Hisense Kelon Electrical Holdings Co., Ltd. (000921.SZ) forecasts 80 percent to 100 percent growth in its annual report, primarily due to revenue growth. Shenzhen Yinghe Technology Co., Ltd. (300457.SZ) forecasts 86 percent to 116 percent growth in the annual report, primarily due to the rapid development of composite quartz business.
[Trading Alarm]
○ Three new shares offer for subscription on Jan. 13
------
Huada Automotive Technology Co., Ltd. (732358.SZ) will offer subscription at 31.18 yuan per share. The upper limit for each applicant is 16,000 shares. The company is primarily engaged in auto parts. Eurocrane Co., Ltd. (732966.SZ) will offer for subscription at 7.32 yuan per share. The upper limit for each applicant is 16,000 shares. The company is primarily engaged in hoisting machinery. Shenzhen Tongxingda Technology Co., Ltd. (002845.SZ) will offer for subscription at 15.99 yuan per share. The upper limit for each applicant is 9,500 shares. The company is primarily involved in LCD module.
TOP
Latest comments