Handan Iron and Steel JTB1: Industry M&A Triggered Warrant Blowout

The news of Baosteel Group's restructuring of Baotou Iron and Steel Group has been officially confirmed. Liang Tiecheng, director of the Inner Mongolia Development and Reform Commission, said in an interview that Baosteel Group is currently in contact with relevant departments of the Inner Mongolia Autonomous Region and Baotou Iron and Steel Group on restructuring matters, and the prospect of achieving strong alliance is optimistic, which comes after Baosteel announced the restructuring Bayi Steel In less than three months, it shows that China's steel industry has entered the fast lane of large-scale mergers and acquisitions, which will stimulate the repeated activity of steel stocks. Handan Iron and Steel was once the key acquisition target of Baosteel Group in the secondary market. At present, there are still three Baosteel related enterprises among the top ten shareholders of Handan Iron and Steel Group, holding more than 140 million shares jointly. The potential restructuring theme will drive the stock to continue to rise Hangang JTB1 (580003) deserves more attention from investors.

Hot topic 1: industry mergers and acquisitions are surging, and the market continues to pursue.

At the end of May 2006, Handan Steel It has acquired 138 million outstanding shares by Baosteel Group and its subsidiaries, becoming the first steel company to be listed by Baosteel Group due to its shareholding exceeding 5% since the share reform. By the end of September 2006, three institutional accounts of Baosteel Group still appeared in the list of top ten shareholders of Handan Iron&Steel, holding more than 140 million shares jointly, one step away from the 5% listing line, which fully shows that Baosteel Group has a strong preference for Handan Iron&Steel. Baosteel announced the restructuring of Bayi Iron&Steel at the beginning of the year. Recently, Liang Tiecheng, director of the Inner Mongolia Development and Reform Commission, said in an interview that Baosteel Group is currently in contact with the relevant departments of the Inner Mongolia Autonomous Region and Baotou Iron&Steel Group about the restructuring, which indicates that Baosteel Group is accelerating the pace of M&A, and Handan Iron&Steel, as its key M&A target, is expected to continue to be sought after by market funds in the future.

Hot topic 2: With the theme of participating in securities companies, warrants are of extraordinary value.

Handan Iron and Steel Co., Ltd. owns 20% of the equity of Huaxin Securities, a comprehensive securities company, which makes Handan Iron and Steel JTB1 a very rare warrant with brokerage themes in the current market. With the deepening of the bull market in China's securities market, the concept stocks of securities companies have been continuously sought after by the market, citic securities And constantly set new historical highs, TEDA 、 Yatai Group The subject stocks of participating securities companies such as Huaxin Securities have doubled. Once Huaxin Securities is backdoor listed, it will bring strong explosive power to Hangang.

Hot topic 3: extremely low premium rate, short-term profiteering varieties.

Handan Iron and Steel JTB1 is one of the lowest price warrants in the market at present. With the rising price of the regular shares of Handan Iron and Steel, its intrinsic value has increased significantly. At present, the premium rate is only about 5%, and the investment risk is extremely low. At the same time, the warrant currently has a leverage of about 1.7 times. Once the market starts, the theoretical rise of the warrant will be about 1.7 times that of the regular stock. It is estimated that if Handan Iron&Steel increases by 30% on the current basis, the warrants will increase by more than 50% in theory. Once the impact of T+0 trading system is taken into account, the actual profit space of warrants will multiply, which is one of the most profitable short-term varieties.

Hot topic 4: large-scale cancellation, and the main organizations are all optimistic.

Since the end of last year, the main force of securities companies has appeared the phenomenon of centralized cancellation of Hangang JTB1. According to the latest statistics, CITIC Securities and other securities companies have created 220 million copies of Hangang JTB1, of which 205 million have been written off. This shows that the main institutions are optimistic about the future development of Hangang and are unwilling to lose their chips. At the same time, due to the extremely low premium rate of Handan Iron and Steel JTB1, new funds and other large institutions are also very likely to buy and lock the warrant for the purpose of building a warehouse in Handan Iron and Steel. As the exercise period approaches, large-scale scramble for the market is imminent.

Hot topic 5: strong short-term power, and continuous outbreak is imminent.

In the secondary market, recently Baotou Steel 、 Masteel The market was significantly boosted due to M&A theme, but Handan Iron&Steel's trend was relatively backward. With the news of Baotou Iron&Steel's restructuring becoming clear, Handan Iron&Steel and other stocks are expected to usher in a strong outbreak of market again, which provides a strong impetus for Handan Iron&Steel JTB1's upward movement. The warrant has been consolidated strongly near the high point recently. At present, the 5-day and 10 day moving averages are again bonded, and the short-term accelerated blowout situation has been formed. It is recommended that investors focus on it.

Huizheng Finance Zhu Guozheng