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Weekly A-share Market Recommendations Summary

Core Content Overview

This document presents weekly stock recommendations from the Industrial Securities Research Institute dated November 23, 2015. It highlights key investment opportunities across various sectors, focusing on real estate, conglomerates, special steel, environmental protection, automobile, and media industries. The recommendations include EPS forecasts, ratings (BUY or OUTPERFORM), and investment highlights for each company, along with potential risks.

Top Stock Recommendations

Main Points and Key Information

1. Guoxing Rongda Real Estate (000838:SZ)

• Sector: Real Estate
• Investment Highlights:
  • Strong support from major shareholder Chongqing Casin Group with significant financial backing.
  • RNAV of real estate projects is CNY 10 per share, with current stock price close to this value.
  • Adjusted private placement offering price to CNY 8.02 per share with a 3-year lock-up period.
• Risks: Potential failure in private placement implementation.

2. Shenzhen Victor Onward Textile Industrial (000018:SZ)

• Sector: Conglomerates
• Investment Highlights:
  • Backdoor listing through Sino Great Wall International, with new shareholder Kunwu JD Capital.
  • Strong overseas expansion, with over CNY 10 billion in contracts.
  • Active development of 'One Belt One Road' projects.
• Risks: Overseas order fulfillment and currency exchange losses.

3. Macrolink Real Estate (000620:SZ)

• Sector: Real Estate
• Investment Highlights:
  • Rich land resources and high NAV of CNY 19.7 billion.
  • Acquired 50.41% stake in New Silk Road Cuturatainment Ltd. for cultural tourism transformation.
  • Continued investment in the financial sector.
• Risks: Systematic risks in the real estate industry.

4. Shanghai Ganglian E-Commerce Holdings (300226:SZ)

• Sector: Steel
• Investment Highlights:
  • Undervalued with a market cap of CNY 9 billion.
  • Strong growth in e-commerce sales and supply chain finance.
  • Plans for expansion and M&A.
• Risks: Sharp steel price volatility.

5. China Union Holdings (000036:SZ)

• Sector: Real Estate
• Investment Highlights:
  • High margin of safety with low valuation relative to RNAV.
  • Restructuring and business transformation initiatives.
  • Strong free cash flow and market cap.
• Risks: Slower-than-expected sales rebound and project progress.

6. Jiangling Motors (000550:SZ)

• Sector: Automobile
• Investment Highlights:
  • Strong earnings forecast due to stable growth in light truck and bus markets.
  • Upcoming product launches in 2016.
• Risks: SUV market underperformance and Everest project failure.

7. YongXing Special Stainless Steel (002756:SZ)

• Sector: Special Steel
• Investment Highlights:
  • Strong orders and promising growth through M&A and organic development.
  • Benefiting from the resumption of nuclear power construction.
• Risks: M&A failure and metal price drops.

8. Jincheng Paper (000820:SZ)

• Sector: Environmental Protection
• Investment Highlights:
  • Strong commitment to 'culture + sports' strategy, aligned with 2022 Winter Olympics.
  • Strategic partnerships and M&A fund for outdoor culture development.
• Risks: Project progress slower than expected.

9. Kaidi Ecological and Environmental Technology (000939:SZ)

• Sector: Environmental Protection
• Investment Highlights:
  • Raised CNY 4.9 billion for operations and secured a strategic acquisition.
  • Strong potential from biomass power plant operations.
• Risks: Delay in biomass power plant commissioning.

10. Shanghai Safbon Water Service (300262:SZ)

• Sector: Environmental Engineering and Service
• Investment Highlights:
  • Acquired leading DAF technology provider for overseas expansion.
  • Active participation in PPP projects.
• Risks: Unmet expectations from KWI acquisition.

11. Fujian Yuanli Active Carbon (300174:SZ)

• Sector: Other Chemical Products
• Investment Highlights:
  • Active in water treatment, pollution control, and thermal energy utilization.
  • Strong growth potential in high-end activated carbon products.
• Risks: Failure to meet expectations in high-end product development.

12. Changzhou Xingyu Automotive Lighting Systems (601799:SH)

• Sector: Automotive
• Investment Highlights:
  • Strong partnership with FAW, GAC, and Nissan.
  • Active in technological upgrades and production expansion.
• Risks: Slump in the car industry and slower business development.

Conclusion

The report outlines a diversified set of stock recommendations, emphasizing companies with strong financial backing, growth potential, and strategic initiatives in key sectors such as real estate, steel, environmental protection, and automotive. Each recommendation includes EPS forecasts, rating status, and potential risks. The BUY rating is given to companies with solid fundamentals and growth prospects, while OUTPERFORM is assigned to those with high upside potential and strategic advantages.