China Merchants Holdings Pacific

With reference to following posting, I have sought further clarifications on when to mark short selling:

i) There is no need marking as long as they own underlying CBs, wrts with short selling with borrowed shares while waiting for conversion to take place...

ii) marking only required should they short sell borrowed underlying shares without longing convertible instruments

Sorry for the mistake
GG

(10-08-2014, 09:24 PM)greengiraffe Wrote: Had a review of short selling on CMP to see if riskless arbitrage indeed took place between CBs and underlying shares. If professional arbitragers indeed conducted riskless arbitrage, the borrowed shares that they shorted ahead of the delivery of converted shares will have to be marked "short sell" and captured under the SGX data.

i) There are hardly any evidence for the past few weeks

http://www.sgx.com/wps/wcm/connect/sgx_e...140613.txt - 0

http://www.sgx.com/wps/wcm/connect/sgx_e...140620.txt - 4k

http://www.sgx.com/wps/wcm/connect/sgx_e...140627.txt - 75k

http://www.sgx.com/wps/wcm/connect/sgx_e...140704.txt - 67k

http://www.sgx.com/wps/wcm/connect/sgx_e...140711.txt - 8k

http://www.sgx.com/wps/wcm/connect/sgx_e...140718.txt - 3k

http://www.sgx.com/wps/wcm/connect/sgx_e...140725.txt - 4k

http://www.sgx.com/wps/wcm/connect/sgx_e...140801.txt - 5k

That means to say that the rise in share price post the revival of the Jiurui deal is the result of genuine buying and the clearance of overhang of converted shares from earlier conversion.

However, interestingly there has been a marked increase on 7 & 8 August:

http://www.sgx.com/wps/wcm/connect/sgx_e...140807.txt - 384307 shares

http://www.sgx.com/wps/wcm/connect/sgx_e...140808.txt -189k

Perhaps finally some professionals are finally at work in the light of rising liquidity due to recent conversion of CBs.

The continued conversion of CBs will continue to pose an overhang of CMP. However, with management's decision to lift interim dividends to 3.5 cents, it is indicative that the management remains confident that CMP's underlying cash generation strength will be able to meet the rising absolute dividend outlays as a result of steady stream of CBs conversion.

Vested
GG

CIMB maintain ADD:

On the right road
At 55% of our full-year forecast, CMH’s 1H14 core earnings are broadly in line
with our expectation. In 2Q14, CMH completed the disposal of its New
Zealand property development business, booking a significant one-off gain.
Our FY14-16 core EPS estimates remain largely unchanged. We keep our Add
rating and target price of S$1.06, based on CY14 residual income value.
Future catalysts include stronger-than-expected organic growth of toll
revenue and further acquisition of toll assets.
1H14 results highlights
2Q14 revenue rose 3% yoy due to higher traffic volume on Yongtaiwen
Expressway, which was partially offset by lower revenue from Beilun
Expressway due to some traffic diversion to competing toll roads. The company
recognised a significant one-off fair value gain of HK68.3m from the disposal of
its New Zealand property development business. Adjusted for the one-off gain
and other non-recurring items, CMH's core earnings amounted to HK$155m in
2Q14, up 6.8% from HK145m in 2Q13. Traffic volume for the overall toll
portfolio stayed healthy in 2Q14. Having fully consolidated the impact of the
traffic diversion to competing toll roads in 2Q14, Beilun’s traffic volume is
expected to resume organic growth.
Strategic acquisition of Jiurui Expressway
Though there is likely to be EPS dilution in the near term due to the share
payment (c.11% new shares) to the vendor of Jiurui Expressway, we like the
acquisition because it will 1) further diversify CMH’s earnings base, 2) increase
the average remaining concession of CMH’s toll portfolio from 12.7 years to
15.3 years, 3) potentially improve CMH’s trading liquidity, and 4) improve
CMH’s long-term earnings growth (see our 21 July 2014 report for details).
CMH is in the right direction, stay invested
CMH announced an interim dividend of 3.5 Scts per share (FY13 full year DPS:
7 Scts). Even with dilution fully factored in, we estimate that CMH’s earnings
will be sufficient to sustain the dividend payout at the current level. We
continue to like CMH for its cheap financing cost (c.3% vs peers’ 4.5-6%), as
well as its strong SOE background.

Just wondering, does cmhp earn any revenue by placing billboard advertising on its toll road. I can't seems to find any information from the annual report on that.

(11-08-2014, 09:46 PM)D.L Wrote: Just wondering, does cmhp earn any revenue by placing billboard advertising on its toll road. I can't seems to find any information from the annual report on that.

I doubt they collect any reVenue for the advertisement. If there is advertisement probably the revenue goes to the government. Don't think it will goes to the toll operators. Government should still own the roads while toll operator owns the rights to collect toll fee i suppose. Anyway that's just what I think.

http://infopub.sgx.com/FileOpen/Cancella...eID=309667

HK$8m CB converted - about 1.263m new shares.

Since 2 April, about 26.662m shares been listed as a result of conversion, representing 3.71% increased on last FY's paid up and issued share capital.

Outstanding CBs represent another 195.498m new shares to be issued.

GG

Important nutrition for a healthy young Dragon...

China's July auto sales up by 6.7pc
AFP AUGUST 14, 2014 11:00AM

Auto sales in China, the world's biggest car market, accelerated in July, growing by 6.7 per cent to 1.62 million vehicles, an industry group says.

For the first seven months of 2014, auto sales reached 13.3 million vehicles, the China Association of Automobile Manufacturers said in a statement, up 8.2 per cent on the same period last year.

China has become critically important to foreign car makers, given the size of the market and weak sales elsewhere in the world.

China's full-year auto sales hit 21.98 million vehicles last year, when a recovery in Japanese brands offset the impact of slowing economic growth.

US auto maker General Motors said its sales increased by 12.7 per cent in July from the same period last year to 249,734 vehicles.

GM's China sales also rose 10.7 per cent to 1.98 million vehicles in the first seven months of the year, the company said.

It also said its annual sales in China, its biggest market, had reached two million vehicles for the year.

That marked "the fifth consecutive year and the earliest ever that GM has reached the milestone", it said.

"We will continue to expand our portfolio and introduce more product offerings in China to meet increasingly diverse demand in our largest market," GM China president Matt Tsien said.

US automaker Ford's China sales rose by 25 per cent to 90,775 vehicles in July from the same month last year, the company.

In the first seven months, sales rose 33 per cent from the same period last year. In July, Ford's China sales increased 33 per cent to 640,031 vehicles, it said.

http://infopub.sgx.com/FileOpen/Exercise...eID=309896

At the end of the financial year, details of the options granted under the Scheme on the unissued ordinary
shares of the Company are as follows:
Date of grant
Balance
as at
1 January
2013
Granted or
exercised
Lapsed or
expired
Balance
as at
31 December
2013
Exercise
price per
share (S$)
Exercisable
period
6 October 2006 9,528,000 (40,000) – 9,488,000 0.789 7 October 2007 to
6 October 2016

5. S hare options (cont’d)
The details of the options granted under the 2002 Scheme to persons who were directors of the Company
during the financial year are as follows:
Name of director
Aggregate options
granted since
commencement
of the Scheme
to the end of
financial year
Aggregate options
exercised since
commencement
of the Scheme
to the end of
financial year
Aggregate
options lapsed/
expired since
commencement
of the Scheme
to the end of
financial year
Aggregate options
outstanding as
at the end of
financial year
Jiang Yan Fei 1,200,000 – – 1,200,000
Lim Heng Kow 150,000 – (150,000) –
Hong Hai 150,000 – (150,000) –
Since the commencement of the Scheme, no options have been granted to the controlling shareholders of
the Company or their associates and no participant under the Scheme has been granted 5% or more of
the total number of options available under the Scheme.
The options granted by the Company do not entitle the holders of the options, by virtue of such holding,
to any rights to participate in any share issue of any other company.

Jiurui deal first revived on 21 Jul 14, they fast hand fast leg...

http://infopub.sgx.com/FileOpen/SGX-ST_A...eID=310319

ANNOUNCEMENT
PROPOSED ACQUISITION OF JIURUI EXPRESSWAY, PEOPLE’S REPUBLIC OF CHINA
SGX-ST APPROVAL IN-PRINCIPLE
The Board of Directors (the “Board”) of China Merchants Holdings (Pacific) Limited (the “Company”)
refers to the proposed acquisition by the Company from Liu Qiang and Gong Xiaoping (the “Sellers”)
of the entire issued share capital of Hong Kong Honest Queen International Investment Limited (the
“Target”) and a shareholder’s loan made by Liu Qiang to the Target (as reflected in the books of the
Target on the date of completion) (the “Acquisition”). The Target is the holding company of Honest
Queen International (Jiangxi) Jiurui Expressway Development Co., Ltd (诚坤国际(江西)九瑞高速公路
发展有限公司) (“Jiurui Expressway Co”). Jiurui Expressway Co owns the rights to operate the Jiurui
Expressway (Jiujiang - Ruichang Section) (江西省九江至瑞昌高速公路), an expressway located in
Jiangxi Province, People’s Republic of China.
All capitalised terms used and not defined herein shall have the same meanings given to them in the
announcement dated 21 July 2014 made by the Company in connection with the Acquisition.
The Board is pleased to announce that the Company has on 15 August 2014 received the in-principle
approval of the Singapore Exchange Securities Trading Limited (“SGX-ST”) for the listing and
quotation of up to 119,374,987 new ordinary shares in the capital of the Company (the
“Consideration Shares”) to be issued by the Company to the Sellers at an issue price of S$0.985 for
each Consideration Share as part of the Consideration for the Acquisition.
The SGX-ST’s approval in-principle for the listing and quotation of the Consideration Shares was
granted subject to, inter alia, compliance with the SGX-ST’s listing requirements and the approval of
the shareholders of the Company (“Shareholders”) for the issue of the Consideration Shares. The
SGX-ST’s approval in principle for the listing and quotation of the Consideration Shares is not to be
taken as an indication of the merits of the Acquisition, the Consideration Shares, the Company and/or
its subsidiaries.
A circular to Shareholders (the "Circular") setting out information on the Acquisition (including, inter
alia, the proposed issue of the Consideration Shares), together with a notice of an extraordinary
general meeting to be convened to approve the Acquisition (including, inter alia, the issue of the
Consideration Shares), will be despatched to Shareholders in due course. In the meantime,
Shareholders are advised to refrain from taking any action in relation to their Shares which may be
prejudicial to their interests until they or their advisers have considered the information and the
recommendations to be set out in the Circular.
BY ORDER OF THE BOARD
Lim Lay Hoon
Company Secretary
Singapore, 15 August 2014

http://infopub.sgx.com/FileOpen/Cancella...eID=310643

HK$10m CB converted - about 1.911m new shares.

Since 2 April, about 28.573m shares been listed as a result of conversion, representing 3.97% increased on last FY's paid up and issued share capital.

Outstanding CBs represent another 193.587m new shares to be issued.

GG

CIMB wrote a report about its small cap recommendation and CM Pacific made it on the list - https://brokingrfs.cimb.com/9ZUmaKBDzw9w...p0t1M1.pdf

No new information. I intend to just sit still and enjoy the 7% yield.

(Vested)