shanghai electric, steady eddie with dividends

Accuracy score :
97%

Shanghai Electric Group Co Ltd

Summary (from latest annual report 2015 and quarterly report 2016)

  • Total equity  : 5.63 billion USD
  • Market Cap is 14 billion USD ( last price of the stock is 3.5 HKD)
  • Shanghai Electric Group Co Ltd is an equipment manufacturing company. The Company is engaged in design, manufacture and distribution of electric power and industrial equipment
  • Equity of total company increased from 5.13 billion USD in 2014 to 5.63 billion in 2016
  • Company has 5.1 billion USD in cash on account (from latest quarterly report)
  •  Total equity – cash on account = 5.63 billion USD – 5.1 billion USD = 530 million USD
  • In 2016 company had 1.66 billion USD long-term debt, short – term debt was 880 million USD                                                                                                                                                            (In 2014 company had 1.59 billion USD short-term debt , long-term debt was 420 million USD)
  • In 2016 quarterly report - total equity increased to 5.63 billion  USD from 5.13 billion USD in 2014, total debt is 2.54 billion USD in 2016)
  • Company's revenue increased in 2015 to 11.7 billion USD from 11.5 billion in 2014
  • Net income in 2015 was 382 million USD, Net income in 2014 was 370 million USD
  • In 2015 company paid 360 million USD dividend to its shareholders

Shanghai Electric Group Subsidiaries

 

Shanghai Electric (SEHK: 2727, SSE: 601727) (officially Shanghai Electric Group Company Limited) is a Chinese multinational power generation and electrical equipment manufacturing company headquartered in Shanghai. On April 28, 2005, Shanghai Electric listed on the Hong Kong Stock Exchange. On December 5, 2008, the group was listed on the Shanghai Stock Exchange.

During the year, the Company and its subsidiaries (together the “Group”) are engaged in the following principal activities:

  • design, manufacture and sale of nuclear power nuclear island equipment products, wind power equipment products and heavy machinery including large forging components, and provision of solution package for comprehensive utilisation of solid waste, sewage treatment, power generation environment protection and distributed energy systems;
  • design, manufacture and sale of thermal power equipment products and corollary equipment, nuclear power conventional island equipment products and power transmission and distribution equipment products;
  • design, manufacture and sale of elevators, electrical motors, machine tools, marine crankshafts and other electromechanical equipment products; and
  • provision of integrated engineering services for power station projects and other industries, financial products and services, international trading services, financial lease and related consulting services and insurance brokerage services.

Major Business Segments are : New Energy and Environmental Protection Equipment ( represents 15% of total revenue), High Efficiency and Clean Energy Equipment (represents 35% of total revenue), Industrial Equipment ( represents 30% of total revenue) and Modern Services (represents 20% of total revenue)

  • China division is worth 12 billion USD
  • Other countries and regions divisions are worth 2 billion USD

 

Important dates

 

  • On 23 January 2009, the Company entered into a framework purchase and sales agreement with Siemens Aktiengesellschaft (“Siemens”,who indirectly owns more than 10% of the registered capital in certain subsidiaries of the Company), pursuant to which the Group has agreed to purchase certain power generation, distribution and transmission related electrical and mechanical components from Siemens and its subsidiaries and associates (“Siemens Group”) to be used in various projects and products of the Group, and the Group will sell certain power generation equipment and related components to Siemens Group
  • In October 2010, Shanghai Electric and Reliance Power of India signed a US$8.3 billion agreement for Shanghai Electric to supply 36 coal-fired thermal power generation units to Reliance over the subsequent three years
  • In April 2011 Shanghai Electric and Alstom agreed to combine their power plant boiler divisions into a new joint-venture company called Alstom-Shanghai Electric Boilers Co
  • In June 2011, Shanghai Electric announced plans to invest RMB 1 billion (150 million USD) in a joint venture with Shanghai Municipal Electric Power Company, with each to hold a 50% stake
  • In September 2011, Shanghai Electric signed a cooperation agreement with CESC to collaborate on the construction of coal-based power stations in India
  • Company entered into a framework purchase agreement with Mitsubishi Electric on 28 March 2013, in relation to the purchase of certain elevators, related components and services

 

 Shanghai Electric Group  standalone subsidiaries and acquisitions :

  • In 2016 Shanghai Electric Group has acquired a 100-percent stake in German aviation equipment manufacturer Broetje-Automation GmbH (BAW) for HK$1.7 billion (219.19 million USD). Through this acquisition, the company is able to enter into automated manufacturing equipment and systems for the aerospace sector
  • In 2014 Shanghai Electric has agreed to buy a 40 percent stake in Italian power engineering company Ansaldo Energia for 554 million USD. The deal will give Shanghai Electric access to some key technology in gas turbines while helping Ansaldo Energia boost sales in Asia, which represents half of the world's gas turbine market
  • In 2012 has agreed to buy a 25% stake of German technology group Manz for 50 million USD
  • Standalone subsidiaries : Shanghai Boiler Works, SEC Power Generation Environment, Shanghai Heavy Machinery Plant Co, Shanghai No.1 Machine Tool Works Co, Shanghai Mitsubishi Elevator and Goss Graphic Systems are worth 650 million USD

Total = 1.47 billion usd

 

In February 2015, the Company completed issuing a total of 60,000,000 A share convertible corporate bonds with a nominal value of RMB100 each (the "Electric Convertible Bonds"), amounting to RMB6 billion in aggregate. The Electric Convertible Bonds were listed on the Shanghai Stock Exchange

 

Opinion about the company

Fundamentally it is a good company and in the future we can expect its growth (Total debt is 2.54 billion USD, company has 5.1 billion USD in cash on account, ROE is around 5 %).