20170725-兴业证券-A-Share_Daily_Express_12页_1mb

报告摘要

Summary of Industrial Securities Co., Ltd. Document

Core Content

This document provides an overview of the China A-Share Market and includes market indices, sector performance, daily headlines, company news, and investment recommendations. It also includes financial data, analyst insights, and investment strategies for the second half of 2017, focusing on the performance of Guangdong Haid Group (002311. SZ) and broader macroeconomic indicators.

Main Market Indices

Index	Close	Daily Change	% Change
SSE Composite	3243.69	↓6.91	↓0.21%
SZSE Component	10353.21	↓51.01	↓0.49%
CSI 300	3719.56	↓23.91	↓0.64%
ChiNext	1688.09	↑1.65	↑0.10%
HSI	26852.05	↑5.22	↑0.02%
HSCEI	10782.74	↓38.21	↓0.35%

Total Market Volume: CNY 434.25 billion, down 12% from Monday.
Market Performance: Losers outnumbered winners by 1856-to-1089.

Market Review

The A-share market ended a 5-day winning streak with a decline, indicating prudent investor behavior.
Financial, construction, and transportation sectors were the best performers in recent days, but profit-taking dragged the market down.
Small-cap tech names were relatively stronger, but lukewarm trading volume suggests limited rebound potential.
ChiNext Index rose slightly, while Shanghai and Shenzhen indices fell.

Sector Review

Winners:

Nonferrous metals and rare earth names outperformed due to positive expectations of 1H earnings.
- Chengdu Galaxy Magnets Co., Ltd. (300127): +7.53%
- Yunnan Copper Co., Ltd. (000878): +6.20%
Electronic sports and media names were strong due to the China Joy event.
- Huayi Brothers Media Corporation (300027): +7.02%
- Perfect World Co., Ltd. (002624): +5.36%

Losers:

Small-cap Banks and Brokerage names fell due to profit-taking.
- Bank of Shanghai Co., Ltd. (601229): -1.97%
- Founder Securities Co., Ltd. (601901): -3.08%
Expressway names saw a selloff after a surge.
- Fujian Expressway Development Co., Ltd. (600033): -5.03%
- Jiangxi Ganyue Expressway Co., Ltd. (600269): -3.33%
Paper makers underperformed due to market conditions.
- Minfeng Special Paper Co., Ltd. (600235): -2.83%
- Shandong Sun Paper Industry Joint Stock Co., Ltd. (002078): -2.63%

Daily Headlines

Proactive fiscal policy and prudent monetary policy will be implemented in H2 2017, with focus on local government debt and financial supervision.
Xi Jinping emphasized positive economic changes and policy stability ahead of the 19th Party Congress.
Offshore yuan stabilized near 6.75, with analysts debating potential FX intervention.
HNA Group disclosed its charitable ownership to address concerns.
Several banks are reducing financing for HNA due to risk concerns.
Sunac China raised HK$4.03 billion through share placement.
Hong Kong SFC is consulting on new financial rules to include mainland commodity exchanges.
China's liquidity may improve in early August.

Investment Strategy

Core assets and leading financial companies are emphasized.
Big Finance:
- Banks: stabilized NIM and reduced non-performing loans.
- Insurance companies: benefit from consumption upgrade.
- Security brokers: expected to bottom out.
Theme Investments:
- Electrical vehicle: rising sales and localization.
- SOE reform: focus on central and local SOEs.

China Macro Economy

Q2 2017 GDP growth reached 6.9%, exceeding expectations.
Industrial sector rebounded with 7.6% YoY growth in June, driven by overseas demand and supply-side reforms.
Fixed asset investment increased from 7.8% to 8.8% in June, with low base effect supporting growth.
Consumption rebounded in June to 11% YoY growth, likely due to sales promotion events like the 6.18 Festival.
Economic fundamentals remain strong, paving the way for intensified financial reform.

Guangdong Haid Group (002311. SZ)

Key Financial Indicators

FY	2016	2017E	2018E	2019E
Revenue (Mn/CNY)	27,185	31,588	36,239	43,853
YoY Growth (%)	6.3%	16.2%	14.7%	21.0%
Net Profit (Mn/CNY)	856	1,205	1,617	2,084
YoY Growth (%)	9.7%	40.8%	34.2%	28.9%
Net Profit Margin (%)	3.1%	3.8%	4.5%	4.8%
ROE (%)	15.1%	17.5%	19.7%	21.1%

Earnings Outlook

2017 Net Profit is expected to be between CNY 423 million and CNY 577 million, up 10-50% YoY.
Feed sales are projected to beat expectations, with a 22.92% increase in Q1 2017.
Gross margin improved by 1.31 percentage points, indicating better profitability.
Investment Recommendations: Strong Buy (Maintained), with earnings forecasts for 2017-2019 at CNY 1.2 billion, CNY 1.62 billion, and CNY 2.80 billion, implying PE ratios of 22.7x, 16.8x, and 13.1x.

Key Risks

Epidemics
Fish price fluctuations
Worse-than-expected weather conditions

Company Profile

Guangdong Haid Group is a public high-tech company primarily engaged in aquatic feed premix, feed, and animal feed.
The company has expanded into animal health products, large-scale animal farming, and high-quality aquatic animal seeds.
Feed sales grew by 16.4% YoY in 2016, with pig feed and aquatic feed showing significant increases.

Investment Rating

Industry Investment Rating:
- Overweight: if the industry outperforms the market.
- Neutral: if the industry performs about the same.
- Underweight: if the industry underperforms.
Company Investment Rating:
- Buy: stock price outperforms the market by more than 15%.
- Outperform: between 5% to 15%.
- Neutral: less than 5% deviation.
- Underperform: more than 5% worse than the market.

Financial Data Highlights

Cash and Cash Equivalent: RMB 122 million (2016), down to -308 million in 2017E.
Net Profit Attributable to Parent Company: RMB 94 million (2016), up to 193 million in 2017E.
EPS: RMB 0.12 (2016), RMB 0.25 (2017E), RMB 0.62 (2018E), RMB 0.88 (2019E).
PE Ratio: 114.59 (2016), 55.81 (2017E), 22.13 (2018E), 15.71 (2019E).
PB Ratio: 5.93 (2016), 5.36 (2017E), 4.32 (2018E), 3.39 (2019E).

Conclusion

The document highlights a mixed performance in the A-share market, with financials and industrial sectors showing resilience, while cyclical stocks underperformed. Guangdong Haid Group is highlighted as a strong performer in the feed sector, with positive earnings outlook and strong buy recommendation. Macro indicators suggest economic stability and support for financial reform. Investors are advised to focus on core assets and leading financial companies.