20151008-兴业证券-Weekly_A-share_Market_Recommendations_Industrial_Securities_Research_Institute_19页_437kb

Weekly A-share Market Recommendations Summary

Core Content Overview

This report provides weekly investment recommendations for several A-share companies across different sectors, focusing on earnings forecasts, growth potential, and potential risks. The recommendations are categorized as BUY and OUTPERFORM, with specific EPS projections and valuation analyses.

Top Stock Recommendations

Main Investment Highlights

China Southern Air (600029: SH)

• Sector: Aviation
• Key Points:
  • Strong demand for air transport driven by tourism and relaxed fiscal and monetary policies.
  • Expected to generate CNY 8 billion in profit for 2015, with upward earnings trend.
  • High-beta airline stocks are currently undervalued with strong upside potential.
  • Earnings are projected to increase from CNY 0.80 in 2015 to CNY 0.95 in 2016.
• Market Data:
  • Closing Price: CNY 7.68
  • Market Cap: CNY 75,398.91 Mn
  • BVPS: 3.94

Kingfa Sci. & Tech (600143: SH)

• Sector: Chemical Engineering
• Key Points:
  • Focus on modified plastics and new chemical materials.
  • Expected to see fast growth in both sales and profits.
  • Biodegradable plastics and carbon fiber composites offer growth opportunities.
  • Earnings forecast: CNY 0.36 in 2015, CNY 0.46 in 2016, CNY 0.60 in 2017.
• Market Data:
  • Closing Price: CNY 7.26
  • Market Cap: CNY 18,585.60 Mn
  • BVPS: 3.19

Guoxing Rongda Real Estate (000838: SZ)

• Sector: Real Estate
• Key Points:
  • Strong support from major shareholder Chongqing Casin Group.
  • RNAV of CNY 10 per share, current stock price close to this.
  • Plans to raise CNY 1.05 billion in follow-on offering.
• Market Data:
  • Closing Price: CNY 17.02
  • Market Cap: CNY 5,351.39 Mn
  • BVPS: 1.53

Shenzhen Victor Onward Textile Industrial (000018: SZ)

• Sector: Conglomerates
• Key Points:
  • Sino Great Wall International is seeking to expand overseas.
  • Post-asset injection, the company's share capital will increase significantly.
  • Overseas contracts and M&A activities are key growth drivers.
• Market Data:
  • Closing Price: CNY 27.50
  • Market Cap: CNY 4,651.41 Mn
  • BVPS: 0.77

Lander Sports Development (000558: SZ)

• Sector: Real Estate
• Key Points:
  • Active expansion in sports industry and online platform development.
  • Market cap of CNY 16.4 billion.
  • Potential for faster business expansion.
• Market Data:
  • Closing Price: CNY 17.88
  • Market Cap: CNY 15,367.55 Mn
  • BVPS: 1.86

Macrolink Real Estate (000620: SZ)

• Sector: Real Estate
• Key Points:
  • Rich land resources and high NAV.
  • Transformation into a cultural tourism company.
  • Active investment in financial industry.
• Market Data:
  • Closing Price: CNY 9.32
  • Market Cap: CNY 17,677.15 Mn
  • BVPS: 2.97

Shanghai Ganglian E-Commerce Holdings (300226: SZ)

• Sector: Steel
• Key Points:
  • Undervalued with strong growth potential.
  • Commitment to digital marketing and e-commerce ecosystem.
  • Expected to benefit from increased consignment sales and supply chain finance.
• Market Data:
  • Closing Price: CNY 55.33
  • Market Cap: CNY 8,631.48 Mn
  • BVPS: 1.40

Zhejiang Kaier New Materials (300234: SZ)

• Sector: Construction Material
• Key Points:
  • Key player in vitreous enamel cladding panel market.
  • Clear business plan targeting energy-saving and environmental protection.
  • Earnings forecast: CNY 0.53 in 2015, CNY 0.70 in 2016, CNY 0.92 in 2017.
• Market Data:
  • Closing Price: CNY 15.79
  • Market Cap: CNY 4,168.56 Mn
  • BVPS: 2.17

Zhangjiagang Furui Special Equipment (300228: SZ)

• Sector: SME Board
• Key Points:
  • Active expansion into overseas markets.
  • New profit drivers include LNG-related products and hydrogen storage.
  • Earnings forecast: CNY 1.92 in 2015, CNY 2.47 in 2016, CNY 3.32 in 2017.
• Market Data:
  • Closing Price: CNY 19.00
  • Market Cap: CNY 5,539.18 Mn
  • BVPS: 4.42

Guangdong Dahuanong Animal Health Products (300186: SZ)

• Sector: Agriculture
• Key Points:
  • Strong growth expected from poultry farming.
  • High valuation discount with potential for 20x 15E PE and 12x 16E PE.
  • Expected profit of CNY 7 billion in 2015 and CNY 12 billion in 2016.
• Market Data:
  • Closing Price: CNY 38.06
  • Market Cap: CNY 20,527.28 Mn
  • BVPS: 3.82

China Union Holdings (000036: SZ)

• Sector: Real Estate
• Key Points:
  • Undervalued with high margin of safety.
  • Recent private placement and business transformation initiatives.
  • Earnings forecast: CNY 0.07 in 2015, CNY 0.90 in 2016, CNY 1.26 in 2017.
• Market Data:
  • Closing Price: CNY 6.46
  • Market Cap: CNY 7,367.55 Mn
  • BVPS: 1.67

Jiangsu Alcha Aluminum (002160: SZ)

• Sector: Non-ferrous Metal
• Key Points:
  • Accelerated business transformation into healthcare.
  • Acquired cleansing technology from Macroprocess.
  • Earnings forecast: CNY 0.18 in 2015, CNY 0.32 in 2016, CNY 0.39 in 2017.
• Market Data:
  • Closing Price: CNY 8.43
  • Market Cap: CNY 5,363.55 Mn
  • BVPS: 3.59

Key Risks Across Companies

• China Southern Air: Potential macroeconomic downturn, oil price surge, exchange rate depreciation, and competition from high-speed trains.
• Kingfa Sci. & Tech: Slower-than-expected project progress and marketing results.
• Guoxing Rongda Real Estate: Failure in private placement implementation.
• Shenzhen Victor Onward Textile Industrial: Delays in overseas orders and currency exchange losses.
• Lander Sports Development: Slower-than-expected project progress.
• Macrolink Real Estate: Systematic real estate risks.
• Shanghai Ganglian E-Commerce Holdings: Steel price volatility.
• Zhejiang Kaier New Materials: Postponement of urban rail construction and new product marketing.
• Zhangjiagang Furui Special Equipment: LNG economic performance and industrialization challenges.
• Guangdong Dahuanong Animal Health Products: Pork price fluctuations.
• China Union Holdings: Uncertainty in private placement and slower transformation.
• Jiangsu Alcha Aluminum: Slow processing fee growth and private placement delays.