20150731-兴业证券-A-Share_Daily_Express_14页_2mb

Summary of Document Content

Core Content Overview

This document provides a detailed analysis of the Chinese stock market performance on July 27, 2015, and includes sector-specific insights, company updates, and investment recommendations. It also outlines key financial indicators and market trends for two major listed companies: Shenzhen Victor Onward Textile Industrial (000018: SZ) and Lianhe Chemical Technology (002250: SZ). The document highlights the overall market decline, the approval of backdoor listing for Shenzhen Victor Onward Textile Industrial, and the strong performance of Lianhe Chemical Technology in the first half of 2015.

Market Overview

• Market Indices:
  • SSE Composite: Closed at 3663.73, down 1.13% for the day and 14.34% in July.
  • SZSE Component: Closed at 12374.25, down 0.17% for the day and 13.70% in July.
  • ChiNext Index: Closed at 2539.84, down 0.83% for the day and 11.15% in July.
  • HSI: Closed at 24636.28, up 0.56% for the day.
  • HSCEI: Closed at 11131.68, down 0.05% for the day.
• Market Volume: Total market volume was CNY 878.08 billion, a 24% decrease from the previous day.
• Market Sentiment: Investor sentiment weakened, with losers outnumbering winners by around 2.15 to 1.
• Key Drivers: Financial sector and consumer stocks showed resilience, while sectors like military equipment and IT experienced heavy selloffs.

Sector Review Highlights

• Financial Sector:

  • China Merchants Bank (600036): Rose 1.88%.
  • Bank Of Nanjing (601009): Rose 1.98%.
  • Guosen Securities (002736): Rose 3.56%.
  • Sealand Securities (000750): Rose 3.64%.

• Consumer Stocks:

  • Midea Group (000333): Rose 2.79%.
  • Gree Electric Appliances (000651): Rose 1.78%.

• Liquor Makers:

  • Anhui Gujing Distillery (000596): Rose 5.65%.
  • Jiangsu Yanghe Brewery (002304): Rose 4.20%.

• Sectors Under Pressure:

  • Military Equipment Manufacturers:
    • Avic Aviation Engine (600893): Fell 10.01%.
    • China Spacesat (600118): Fell 10.00%.
  • IT Sector:
    • Digiwin Software (300378): Fell 10.01%.
    • Newcapec Electronics (300248): Fell 10.01%.

Daily Headlines

• Macro Policy: The Chinese government will implement targeted macroeconomic policies to support the economy and counter downward pressure.
• Regulatory Actions:
  • The China Insurance Regulatory Commission advised insurers to avoid selling equities in the near future.
  • Chinese regulators dismissed accusations of foreign short selling as overblown.
• Informal Financing: About 60% of informal financing on HOMS may have disappeared since July 12.
• Political Development: A retired top general of the People's Liberation Army was expelled from the Communist Party for corruption.

Latest Company Events

• BlueFocus (300058.SZ): Invested 35 million yuan in Jiemian.
• BYD (002594.SZ): Sold electric vehicles in London.
• China Cosco (601919.SH): Expected 1H net income of about CNY 1.9 billion, compared to a loss in the same period last year.
• China Merchants Bank (600036.SH): Group bought 58.8 million A-shares.
• China Merchants Energy (601872.SH): To purchase 4 vessels from Vale unit for $448 million.
• China Railway Const (601186.SH): Won projects valued at approximately CNY 26.7 billion.
• China St Const Eng (601668.SH): Controlling shareholder bought 10 million shares between July 9 and 30.
• Wanda Cinema Line (002739.SZ): 1H net income rose 51% year-on-year to CNY 628.5 million.
• Zoomlion (000157.SZ): Repurchased H-shares.

Investment Recommendations

Shenzhen Victor Onward Textile Industrial (000018: SZ)

• Backdoor Listing Approved: The company received regulatory approval for its assets restructuring plan.
• Strategic Focus: Shifted to overseas markets, with significant overseas contracts and growth.
• Financial Outlook:
  • EPS Forecast: CNY 0.88 (2015), CNY 1.40 (2016), CNY 1.84 (2017).
  • Valuation Ratios:
    • PE: 35.2 (2015E), 22.2 (2016E), 16.9 (2017E).
    • PB: 12.0 (2015E), 7.8 (2016E), 5.3 (2017E).
• Investment Rating: Buy (Maintained).
• Potential Risks: Overseas order fulfillment and currency exchange losses.

Lianhe Chemical Technology (002250: SZ)

• Performance in 15H1:
  • Revenue: CNY 1.922 billion (up 8.0% YoY).
  • Operating Profit: CNY 359 million (up 23.6% YoY).
  • Net Profit: CNY 302 million (up 25.4% YoY).
• Segment Performance:
  • Industrial Business: Increased by 24.3% YoY, contributing CNY 1.763 billion.
  • Trade Business: Declined by 57.8% YoY due to risk control.
• Geographic Growth:
  • Domestic Sales: Rose 32.5%.
  • Overseas Sales: Rose 20.7%.
• Financial Outlook:
  • EPS Forecast: CNY 0.84 (2015), CNY 1.10 (2016), CNY 1.43 (2017).
  • Valuation Ratios:
    • PE: 35.2 (2015E), 22.2 (2016E), 16.9 (2017E).
    • PB: 12.0 (2015E), 7.8 (2016E), 5.3 (2017E).
• Investment Rating: Buy (Maintained).
• Potential Risks: Surge in raw material prices and slower-than-expected business expansion.

Key Financial Data

Shenzhen Victor Onward Textile Industrial (000018: SZ)

• Closing Price: CNY 31.05
• Total Shares (Mn): 169.14
• Shares Outstanding (Mn): 169.14
• Market Cap (CNY/Mn): 5251.87
• Market Float (CNY/Mn): 3096.32
• Net Assets (CNY/Mn): 130.95
• Total Assets (CNY/Mn): 185.08
• BVPS: 0.77

Lianhe Chemical Technology (002250: SZ)

• Closing Price: CNY 22.07
• Total Shares (Mn): 835.11
• Shares Outstanding (Mn): 550.55
• Market Cap (CNY/Mn): 18430.95
• Market Float (CNY/Mn): 12150.55
• Net Assets (CNY/Mn): 3962.86
• Total Assets (CNY/Mn): 6002.23
• BVPS: 4.75

Analysts and Translators

• Analysts:
  • MENG Jie: mengjie@xyzq.com.cn, S0190513080002
  • ZHENG Fangbiao: zhengfb@xyzq.com.cn, S0190510120005
  • TANG Jie: tangjie87@xyzq.com.cn
• Translators:
  • PAN Mengchen: panmengchen@xyzq.com.cn
  • LI Xing: lixingyj@xyzq.com.cn

Conclusion

The document outlines the performance of the Chinese stock market, emphasizing the downward trend in July and the impact on investor sentiment. It highlights the performance of key sectors and individual stocks, with a focus on financials and consumer stocks showing strength, while others like military equipment and IT faced selling pressure. Two companies, Shenzhen Victor Onward Textile Industrial and Lianhe Chemical Technology, are analyzed in depth, with both showing positive growth and strong investment potential. The report concludes with a Buy recommendation for both companies, suggesting that they are well-positioned for future growth and have a high margin of safety.