20160118-兴业证券-Weekly_A-share_Market_Recommendations_13页_384kb

Weekly A-share Market Recommendations Summary

Core Content Overview

This document provides weekly stock recommendations from the Industrial Securities Research Institute, dated January 18, 2016. It highlights key investment opportunities across various sectors, including Tourism, Pharmaceuticals, Real Estate, Construction Decoration, and Rail, with detailed EPS forecasts, market data, and potential risks for each company.

Top Stock Recommendations

Main Points and Key Information

Lijiang Yulong Tourism (002033.SZ)

• Sector: Tourism
• Rating: BUY
• Key Highlights:
  • Low valuation and small market cap.
  • Abundant cash reserves (CNY 1.3 billion).
  • Rich tourism resources and dispersed equity structure.
  • Expected EPS of CNY 0.81 in 2016 and CNY 0.95 in 2017.
  • Potential risks: decline in tourist numbers, prolonged project development.

Han's Laser Technology Industry Group (002008.SZ)

• Sector: Other Electronics
• Rating: BUY
• Key Highlights:
  • Expected peak year in 2016 due to iPhone 7 sapphire crystal demand.
  • New projects expected to generate additional CNY 300 million earnings annually.
  • Potential risks: lower iPhone 7 sales, slow adoption of sapphire crystal, weakening industrial demand.

China National Medicines Corporation (600511.SH)

• Sector: Pharmaceuticals
• Rating: OUTPERFORM
• Key Highlights:
  • Part of Sinopharm Group's restructuring.
  • Low valuation and moderate growth.
  • Plans to resolve peer competition issues by end of March 2016.
  • Potential risks: SOE reform progress not meeting expectations.

Shanghai M&G Stationery (603899.SH)

• Sector: Light Manufacturing
• Rating: OUTPERFORM
• Key Highlights:
  • Recognized long-term investment value.
  • Institutional investors hold large positions.
  • Earnings growth projected at over 20%.
  • Focus on expanding stationery business and upgrading technology.
  • Potential risks: management issues, slowdown in office supplies market expansion.

Jiangsu Linyang Energy (601222.SH)

• Sector: Meters
• Rating: OUTPERFORM
• Key Highlights:
  • Strong CAGR of over 25% due to power plant operations.
  • Internet of Energy strategy is yielding results.
  • Potential risks: earnings not meeting expectations, new business challenges.

Bank of Nanjing (601009.SH)

• Sector: Banking
• Rating: OUTPERFORM
• Key Highlights:
  • Focus on fixed-income products, which may benefit from interest rate cuts.
  • Low bad credit risk due to local government clients.
  • Potential risks: systematic banking industry risks.

China Union Holdings (000036.SZ)

• Sector: Real Estate
• Rating: BUY
• Key Highlights:
  • High margin of safety with RNAV of CNY 11.2.
  • Benefited from previous property price surge.
  • Business transformation expected to accelerate.
  • Potential risks: weaker industry recovery, slow project progress.

Nanjing Xinlian Electronics (002546.SZ)

• Sector: Meter
• Rating: OUTPERFORM
• Key Highlights:
  • Building electricity services cloud platform.
  • Earnings growth expected.
  • Potential risks: slower platform development, client payment delays.

Sino Great Wall (000018.SZ)

• Sector: Construction Decoration
• Rating: BUY
• Key Highlights:
  • Expanding into healthcare via PPP and BOT.
  • Expected overseas EPS CAGR over 50%.
  • Potential risks: fewer contracts, slow overseas growth, payment issues.

Guangshen Railway (601333.SH)

• Sector: Rail
• Rating: OUTPERFORM
• Key Highlights:
  • Expected to benefit from rail fare hikes and land development.
  • Potential EPS boost from fare increases.
  • Market concerns about Futian Railway Station's impact on passenger flow.
  • Potential risks: rail fare hike, land reform, uncertainty in asset injection.

Summary of Investment Highlights

• Lijiang Yulong Tourism is recommended for its low valuation, strong cash reserves, and tourism potential.
• Han's Laser Technology benefits from the iPhone 7 sapphire crystal demand and project payoffs.
• China National Medicines is part of a major restructuring and has low valuation.
• Shanghai M&G Stationery has strong institutional backing and growth potential in stationery and technology.
• Jiangsu Linyang Energy is growing rapidly with a sound power plant strategy.
• Bank of Nanjing has a low bad credit risk and may outperform due to interest rate cuts.
• China Union Holdings has a high margin of safety and is transforming its business.
• Nanjing Xinlian Electronics is building a cloud platform and expanding its business.
• Sino Great Wall is expanding into healthcare and overseas markets.
• Guangshen Railway is expected to benefit from rail reforms and land development.

Potential Risks Across All Companies

• Lijiang Yulong Tourism: Decline in tourists, slow project development.
• Han's Laser Technology: Lower iPhone 7 sales, slow adoption of sapphire crystal, weak industrial demand.
• China National Medicines: SOE reform not meeting expectations.
• Shanghai M&G Stationery: Management risk, office supplies market slowdown.
• Jiangsu Linyang Energy: Earnings slipping, new business challenges.
• Bank of Nanjing: Systematic banking risks.
• China Union Holdings: Weak industry recovery, slow project progress.
• Nanjing Xinlian Electronics: Slow platform development, client payment delays.
• Sino Great Wall: Fewer contracts, slow overseas growth, payment issues.
• Guangshen Railway: Rail fare hike uncertainty, land reform delays, asset injection uncertainty.

Disclaimer and Information Disclosure

• The report is issued by Industrial Securities Research Institute.
• The views in the report are based on due diligence and professional research.
• The report is for the use of the Company's clients only.
• The Company reserves all rights to the report and prohibits unauthorized copying or redistribution.
• The report is based on public information, and the Company does not guarantee its accuracy or completeness.