20151013-兴业证券-A-Share_Daily_Express_14页_775kb

Industrial Securities Co., Ltd. Summary

Core Content Overview

Industrial Securities Co., Ltd. provides a comprehensive market review and analysis for the Chinese financial market, including key stock indices, sector performance, daily headlines, company news, and investment strategies. The document also includes detailed financial data for specific companies such as Jiangsu Phoenix Publishing&Media and Juneyao Airlines, along with analyst insights and valuation metrics.

Market Indices

Market Volume: CNY 766.36 billion (USD 121.64 billion), the highest in two weeks.

Performance: 1653 tickers rose, 649 tickers fell, with winners outnumbering losers by 2.55 to 1.

Market Review

• The market started the day with a decline but ended slightly higher.
• Pressure to rise persisted during the day, with difficulty in reaching the 3300 level.
• Profit-taking by investors and sufficient market liquidity contributed to volatility.
• The Shanghai Composite increased by 0.17% to 3293.23.
• The Shenzhen Component rose by 0.74% to 11042.13.
• The ChiNext index increased by 1.09% to 2342.04.
• The financial sector underperformed, while electronic equipment, computers, and traffic and transportation sectors outperformed the index.

Daily Headlines

• Export Data: Chinese exports in September may have fallen 6% y/y in USD terms, down from 5.5% in August. Imports may have dropped 16%, vs. 13.8% in August. Trade surplus may have fallen to USD 48.21 billion from USD 60.24 billion.
• Economic Warning: PBOC academic warns of falling borrowing demand due to economic slowdown.
• Policy Meeting: The Communist Party will hold a key meeting on the 13th five-year plan from Oct. 26 to 29.
• Corporate Risk: Nanjing Yurun Foods faces financial and operational risks, including potential bond default.

Latest Company News

• Beijing Jingneng Power (600578.SH): An oil tank fire on Oct. 10 resulted in 3 deaths and 1 missing. Energy production in the first three quarters of 2015 dropped 3.35% yoy.
• Da An Gene (002030.SZ): Obtained one medical device license.
• JSTI Group (300284.SZ): Net profit in 2015 is expected to rise 15%-35% yoy.
• Tianjin FAW Xiali Auto (000927.SZ): Sept. vehicle sales dropped to 3,759 units from 5,242 in the same period last year.

Today's Research: Fixed Income Weekly

Key Points:

1. Long-term Bond Rates: Sharp decline since September, attributed to improved liquidity expectations.
2. Liquidity Expectations: Improved by forex rate stability and anticipated monetary policy easing.
3. Bond Price Trends: Prices increased before the National Day holiday due to overseas investor participation. Post-holiday, domestic banks drove the price increase.
4. Yield Curve: Expected to steepen temporarily due to liquidity loosening and reduced risk, but long-term rates may continue to trend downward.
5. Credit Bonds: Yields are expected to fall after risk-free interest rates decline. Investors should remain cautious about credit risks, especially with low-rating bonds.

Company Analysis: Jiangsu Phoenix Publishing&Media (601928: SH)

Outperform (Maintained)

• Strategic Move: Collaborated with Xueersi to invest USD 30 million and CNY 7 million in Phoenix Xue Yi, giving it 35.22% and 32% stakes respectively.
• Future Plans: Phoenix Xue Yi (Xue Ke Wang) is expected to go public independently.
• Earnings Forecast:
  • 2015: CNY 0.57 EPS (22x PE)
  • 2016: CNY 0.68 EPS (18x PE)
  • 2017: CNY 0.83 EPS (15x PE)
• Key Financials:
  • Revenue: CNY 9618 Mn (2014), CNY 11014 Mn (2015E), CNY 12597 Mn (2016E), CNY 14833 Mn (2017E)
  • Net Profit: CNY 1205 Mn (2014), CNY 1447 Mn (2015E), CNY 1742 Mn (2016E), CNY 2121 Mn (2017E)
  • Gross Margin: 36.8% (2014), 39.4% (2015E), 39.9% (2016E), 40.4% (2017E)
  • Net Profit Margin: 12.5% (2014), 13.1% (2015E), 13.8% (2016E), 14.3% (2017E)
• Potential Risks: Cooperation outcomes may be less than expected, and risks associated with SOE reform.

Company Analysis: Juneyao Airlines (603885: SH)

Buy (Maintained)

• Investment Strategy: As a private airline operator, Juneyao is expanding its fleet rapidly.
• Earnings Outlook:
  • 2015: CNY 2.11 EPS (24x PE)
  • 2016: CNY 3.36 EPS (15x PE)
  • 2017: CNY 4.62 EPS (11x PE)
• Key Drivers: Expected growth from the opening of Shanghai Disney Resort and a potential turnaround from loss to profit. Rising proportion of individual air travelers supports growth.
• Revenue Breakdown (June 30, 2015):
  • Total Revenue: CNY 384,209.91
  • Operating Revenue: CNY 382,229.58
  • Passenger Transport: 98.3% of total revenue

Analysts and Translators

• Analysts:
  • TANG Yue (tangyue@xyzq.com.cn)
  • ZHANG Heng (hengzhang@xyzq.com.cn)
  • ZHANG Xiaoyun (zhangxiaoyun@xyzq.com.cn)
• Translators:
  • PAN Mengchen (panmengchen@xyzq.com.cn)
  • LI Xing (lixingyj@xyzq.com.cn)

Key Financial Ratios (Jiangsu Phoenix Publishing&Media)

• Growth:
  • Business Revenue Increase Rate: 25.8% (2014), 14.5% (2015E), 14.4% (2016E), 17.7% (2017E)
  • Business Profit Increase Rate: 18.0% (2014), 28.8% (2015E), 23.5% (2016E), 24.1% (2017E)
  • Net Profit Growth Rate: 26.4% (2014), 20.0% (2015E), 20.4% (2016E), 21.8% (2017E)
• Profitability:
  • Gross Margin: 36.8% (2014), 39.4% (2015E), 39.9% (2016E), 40.4% (2017E)
  • Net Profit Margin: 12.5% (2014), 13.1% (2015E), 13.8% (2016E), 14.3% (2017E)
  • ROE: 12.0% (2014), 12.9% (2015E), 13.4% (2016E), 14.0% (2017E)
• Solvency:
  • Asset-liability Ratio: 36.6% (2014), 37.4% (2015E), 33.8% (2016E), 33.0% (2017E)
  • Current Ratio: 1.91 (2014), 1.88 (2015E), 2.24 (2016E), 2.42 (2017E)
  • Quick Ratio: 1.31 (2014), 1.35 (2015E), 1.61 (2016E), 1.77 (2017E)
• Valuation Ratios:
  • PE: 26.2 (2014), 21.8 (2015E), 18.1 (2016E), 14.9 (2017E)
  • PB: 3.1 (2014), 2.8 (2015E), 2.4 (2016E), 2.1 (2017E)

Conclusion

Industrial Securities provides a detailed analysis of the Chinese stock and bond markets, highlighting the mixed performance of key indices and the impact of economic and policy factors. The report emphasizes the potential for growth in emerging sectors like online education and air transportation, while cautioning against credit risks and corporate governance issues. It also includes specific insights and forecasts for Jiangsu Phoenix Publishing&Media and Juneyao Airlines, indicating a positive outlook for both companies.