2012-02-07

Chinese nuclear power plays

消息称核电项目将恢复审批 12股被极度低估 (12 underrated stocks for nuclear power)

There are more than 12 companies listed in the article above, despite the title. Many are conglomerates with divisions that supply the nuclear power industry; some are raw material processors. Only a couple listed in the article trade in Hong Kong.

I lean towards overseas uranium miners because there's less regulatory uncertainty. For example, Chinese rare earth companies were damaged by the export quotas because the sales cap and higher prices were captured by foreign miners. For Chinese firms, I'd focus on technology companies with concentrated exposure to nuclear energy and not broader construction sectors. This way, you're protected if there's a general slowdown in the Chinese economy. Harbin and Dongfang, the two firms also listed in Hong Kong, may do well since Chinese power demand is set to grow.

I only list these firms for information purposes, I have not researched any of them. I've created a portfolio of all these stocks to track their performance going forward, inception data February 7, 2012. Value at inception: $300.
Power equipment producer Harbin Electric (1133.HK) has received a purchase order from Jiangsu Lianyungang Port Co (600108.SS).

Equipment supply companies:

Shanghai Automation & Instrumentation (600848.SS)

SUFA Technology (000777.SZ)

Shanghai Electric (601727.SS) (2727.HK)

Nanfeng Ventilator (300004.SZ) Nanfeng is also involved in subway construction, which may see a slowdown as the real estate market slows and land sales (a major source of government revenue) dry up. See City Subway Construction Decelerates in China

Shentong Valve (002438.SZ)

Dongfang Electric (1072.HK) (600875.SS)

Suzhou Hailu Heavy Industry (002255.SZ)

Shanghai Mechanical and Electrical (600835.SS)

Guangdong Orient Zirconic (002167.SZ)

Zhejiang Shenghua Biok Biology (600226.SS) From their website, "one of the leading manufacturers and exporter specialized in bio-agrochemicals, medicaments for animal nutrition and health in China," but they also produce zirconium.

Baoji Titanium (600456.SS)

Guangdong Shaoneng (000601.SZ)

Sinosteel Jilin Carbon (000928.SZ)

Western Metal Materials (002149.SZ) (This is a rare earth company)

Fangda Carbon New Material (600516.SS) (Reactor graphite)

Inner Mongolian Lantai Industrial (600328.SS)



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