A-Share Corporate Day:A taste of Shenzhen Connect

Event

Connect-eligible A-shares have increased significantly, particularly in neweconomysectors, since the launch of Shanghai stock connect on 5 December2016. Our Corporate Day, in collaboration with Shanghai Listed CompaniesAssociation, will feature one-on-one and group meetings with A-sharecompanies (Shenzhen connect-eligible) in technology and high-endmanufacturing. These companies have leading positions in their sectors andliquid shares to trade, and most importantly, have overseas investors alreadyowning up to 65% of the free float through QFII. Here are brief profiles of ourcorporate attendees.

Why investors should meet these companies

Shanghai 2345 Network - The company generates revenues mainly from twodivisions: 1) Internet Services, i.e., operation of 2345.com, its PC and mobilenavigation site; and, 2) Software Outsourcing Services, with Japaneseenterprises as main target clients. 2345.com is the No.3 online navigation sitein China after Hao123.com (owned by Baidu) and 360.com (owned by Qihoo),according to iResearch.

GCL System - GCL System Integration (002506 CH), market cap: US$4bn,6-month average turnover: US$25m. GCL System Integration is currentlyglobal top 3 module manufacturer with cumulative module capacity of 6GW asat end-2016. It’s a subsidiary of GCL Group’s, which owns 50% of its shares.

GCL System Integration should offer investors a good opportunity to conductsupply chain checks on the China solar sector.

Shanghai Kinlita Chemical – Kinlita specializes in production and sales ofelectrophoretic coatings and automotive painting. The company mainlyfocuses on the commercial-vehicle (CV) market and sells its products via twochannels: direct sales to auto OEMs, and distribution through dealers, i.e. thenon-OEM channel. It was established in Shanghai in 2000 and listed at theShenzhen Stock Exchange in 2011.

Shanghai SMI - SMI is an integrated company that is principally engaged inproperty development and distribution, supply of raw water and tap water, andprovision of sewage treatment services. Both of the gross asset and net assetscale, as well as the market value list top 10 among all the listing companiesowned by SASAC. The latest acquisition, spin-off and IPO are a goodexample of SOE reforms.

Shanghai Step – This company leverages motion-control technology ofelevator control systems to develop industrial robots and key robotcomponents. According to management, the company has also acquiredmultiple robot subsidiaries, strengthening its exposure in the value chain suchas SCARA robots, integrated solutions and sales channels.

Songz Automobile - Songz is one of the leading bus air-conditioning system(ACS) suppliers in China. It covers most bus OEMs, including King LongMotor, Yutong, and BYD. It is also expanding business in the passengervehicle (PV) segment, and key clients include JAC, Changan, SAIC. SAICVW,from which Songz won a contract in 2016, is its most recent client,according to Songz’s management.