Xinjiang Tianye (600075) Comment on Important Issues: Complement High-quality Tianneng Chemicals and Accelerate National Reform

Xinjiang Tianye (600075) Comment on Important Issues: Complement High-quality Tianneng Chemicals and Accelerate National Reform

The company announced that it will introduce M & A Group Tianneng Chemical 45 to introduce PVC and related integrated assets to accelerate national reform and optimize the industrial structure.

We are optimistic about the company’s long-term development and maintain the company’s 2019- / 21 EPS forecast at 0.

54/0.

68/0.

84 yuan / share, given a target price of 11 yuan (corresponding to 20 times PE in 2019), maintain “Buy” rating.

The company will include the Group’s 45 preliminary high-quality PVC production capacity.

This announcement of the company will purchase 100% equity of Tianneng Chemical held by Tianye Group and Jinfu Investment through issuing shares, convertible bonds and paying cash.

The price of the issued shares is intended to be.

94 yuan / share.

In addition, the company plans to raise matching funds from non-public issuance of shares and convertible bonds to no more than 10 specific shareholders to pay the cash consideration of the transaction, intermediary agency fees and related taxes, and supplement the listed company’s working capital.
Tianneng Chemical is part of the Group’s original 120 PVC project and is a quality asset of the Group.

The injection of assets is conducive to the Group’s continuous promotion of national reform and asset securitization, and is conducive to the long-term development of listed companies.

Expose non-main business assets and continuously optimize the industrial structure.

Military, the company continued to promote reforms in accordance with the strategy: 1) Passed Shihezi Tianye Tomato Products Co., Ltd. 62 in December 2018.

967% equity transfer plan; 2) In February 2019, the company publicly pre-listed and transferred 100% equity of Beijing Tianye Oasis Technology Development Co., Ltd. and 100% equity of Jinghe Xinshi Transportation Co., Ltd.

The above three companies have completed audits and evaluations and 杭州桑拿网 plan to formally list.

The company plans to speed up the progress of divestiture of non-main business assets and reorganization of assets. In accordance with the reform requirements of state-owned and state-owned enterprises, strengthen the ability and competitiveness to respond to market risks, fight reforms, and focus on the development of chemical and new materials.

The plasma project is advancing rapidly, and it is expected to significantly increase its performance after reaching production.

The company and the group established a joint venture, Tianye Huihe, to undertake the Group’s one million tons of butyl phase 60 additive project.

The core reactor production capacity currently used in the project, the scale of a single set of production lines, and product quality are at the internal leading level. The device is large, intensive, and large-scale competitive advantages will be fully realized.Realized sales income of 4.2 billion yuan and annual profit8.

4 trillion, a significant increase in performance.

Risk factors: market demand and product price risk; project progress is less than expected; restructuring is uncertain.

Investment suggestion: The company will accelerate the national reform and optimize the industrial structure.

Optimistic about the company’s long-term development and maintain the company’s EPS forecast for 2019/20/21 to 0.

54/0.

68/0.

84 yuan / share, given a target price of 11 yuan (corresponding to 20 times PE in 2019), maintain “Buy” rating.

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