Category: Money tips Release Date: 2006-05-02
Source: Hantang Securities Author: Chan Chi-kwong
The market continued to rack up multi-year high, but also because investors have begun to worry about market risks began to gather. Therefore, various types of funds were inclined to adopt a defensive investment strategy, has also led to the recent iron and steel, electric power and its defense industry strong, low-cost Tuesday Shantou Electric Power shares hit daily limit even more. In the iron and steel, nonferrous metal stocks broke out at the same time, the power plate leading stocks such as China Yangtze Power, Huaneng Power International, also show very conspicuous. From the sector-specific point of view, iron and steel, electric power industry is typical of the defense industry, which is characterized by a good and stable profitability, and generally low market valuation, stock prices fell up little space, while the price has been in a rising cycle, the profit status of electric power enterprises are also expected to increase steadily. This feature is also variety in the market for these industries into a more defensive strategy during the train of thought favored by the market.
According to statistics, the total equity weighted power plate (excluding loss-making shares) trades at 15.81 times earnings optimization, and iron and steel, transportation and other plates at a relatively low price-earnings ratio with the level of the ranks. Comparison of the international market, the U.S. market, the level of the power plate price-earnings ratio of 20 times, and from the net capital gains rates, gross margin and dividend payout ratio and other indicators, the domestic electric plates are stronger than the U.S. market. Thus, from the perspective of international comparisons more, it is easy to see the current value of the domestic focus of power companies, there is clearly underestimated. It also started a section for electrical continuity of the value of the revaluation Quotes foreshadowed.
By the recently established National Electricity reform is the development direction of the next five years, as well as domestic power industry restructuring and other upcoming big good news of the stimulus, the power unit is expected to become the iron and steel stocks after the outbreak of a potentially dynamic plate. As in recent years, high coal prices have continued to run enterprises in the power comparison, the hydro power plant was significantly higher than the cost advantage.
In this context, we are concerned Chuantou energy (600,674) of such enterprises started to increase transformation into the hydro-electric power will replace thermal power generation assets, the performance is expected to be significantly improved. At the same time the majority shareholder with Sichuan Investment Group is likely to continue into the good assets of listed companies to improve business performance and strengthen its financing capacity of capital markets, making it the flagship group of resources and platforms, while it possesses the railway equipment, and potential subjects of silicon assets of the estate into the subject, may wish to focus on.
Chuantou Energy (600,674): The valuation is obviously low and the market entered the defense phase of the background characteristics of the power section will receive a new awareness of the market opportunities. Sideways on a disk in a long-term low-cost power plate should be adequate attention. For example, there are cross-cutting Tuesday finishing more than three months of Shantou Electric Power shocks daily limit, but the whole power section is worth digging there are many varieties of existence of investment opportunities is expected in the next stage of the outbreak, Sichuan is also a vote in the energy area around the 4 yuan shock up to 3 months of low-cost electric power unit, and from the performance and shareholder background, Chuantou energy than the Shantou Power are obviously superior.
At the same time the assets of the unit into the subject matter with concern, particularly the parent company of Sichuan Investment Group in Sichuan Xinguang Silicon Industry Technology, Inc. is a solar cell industry chain, the upstream business, with prominent solar theme, once held by the company equity into the listed company, will bring a huge room for imagination. Additionally, the company holds 50% of the National Chiao Tung University, Chengdu light Industrial Co., Ltd., the main development and production of industrial, rail automation control equipment, in 2005 sales revenue of 1.144 billion yuan, the railway equipment, with good growth prospects. Sichuan Investment Group took over the company after a series of asset restructuring, has high quality assets into the main electric power up to 8 million yuan, to enable listed companies to transition to a bright future of clean power energy industry. Sichuan Investment Group issued a statement: will continue to support Chuantou energy to do good, stronger, bigger, and when conditions are ripe, in an appropriate manner in accordance with statutory procedures to Chuantou energy into quality assets.
A major shareholder of Sichuan Sichuan Investment Group Xinguang Silicon Technology Inc., is the group's leader, one of the industry. The company assumed "an annual output of 1,000 tons of polysilicon Demonstration Project" national high-tech industrialization projects, were classified as Sichuan Province One western development projects, production capacity will be used exclusively for production of solar polysilicon. while the G Chuantou (600,674) as the group's only one listed company, the Group will try its them. According to Sichuan Investment Group chairman, Chuantou Energy Chairman said that the listed companies Chuantou energy will be voted in accordance with Tuochuan Group, bigger and stronger the main energy and electricity supply industry, and did not rule out the market in due course, of common concern to polysilicon project into the listed company.
Chuantou Chuantou Group energy is the only listed company, Sichuan Investment Group is also a link with an effective channel for capital markets. In fact, the support group of listed companies has been ongoing, in the "West", "West Dian-dong send "and the larger environment, as the energy giant Sichuan Investment Group in Sichuan's capital market window Chuantou energy, strategic positioning will be the Sichuan Investment Group as a development strategy to achieve the capital financing platform and development platform.
It is understood that, as at the end of 2005, Sichuan Investment Group, the parent company with total assets of 55.6 billion and net assets of 15.5 billion, is an asset in Sichuan's largest enterprises, among which 51.7 billion energy electricity asset class, accounting for total assets of 93%, the Senate, holding the total power installed capacity of 9.35 million kilowatts, accounting for Sichuan Province, the total installed capacity of the existing electricity 40%.
