Shanghai DaZhong Public Utilities

  (Public, SHA:600635)

Company’s Fact

Shanghai DaZhong Public Utilities (“SDZ”) was established on December 24, 1991. Its predecessor was Shanghai Pudong Public Taxi Co., Ltd., was the first joint-stock company in the taxi industry. On March 4, 1993, SDZ was listed on Shanghai Stock Exchange. Within the past 11 years, the Company has established a good blue-chip corporate image. SDZ is the constituent stock on Dow Jones China Index, in 2002 the Company was selected in the first batch of Shang Jiaosuo 180 Index, and the Top 100 Most Influential Listed Company on Shenzhen Stock Exchange. At the end of 2003, SDZ achieved net assets of nearly 1.8 billion yuan. At present, SDZ has underground gas pipe network with a total length of 5,380 km across the country, its gas users reached 1.75 million.

Apart from transmission and distribution of gas, the Company is also involved in industrial business, commercial business and the businesses of construction, material distribution, leasing and labor service provision. During the year ended December 31, 2007, the Company obtained about 81% and 13% of its total revenue from gas sale and construction business respectively.

Financial Overview

10.23
-0.23 (-2.20%)
Jun 27 - Close    

Open:  10.30      Mkt Cap:  15.30B      P/E:  55.10      Dividend:      -    

High:  10.78      52Wk High:  25.45      F P/E:      -      Yield:      -    

Low:  9.76     52Wk Low:  8.61     Beta:      -      Shares:  1.50B    

Vol:  48.18M      Avg Vol:      -      EPS:  0.19      Inst. Own:      -

Key Stats & Ratios

Date                Open High   Low     Close Volume

27-Jun-08      10.30 10.78 9.76    10.23 48,184,600

26-Jun-08      10.19 10.80 10.07 10.46 30,853,800

25-Jun-08      9.78    10.47 9.63    10.28 26,923,000

24-Jun-08      9.34    9.80    9.31    9.71    18,890,500

23-Jun-08      9.28    9.66    9.03    9.31    13,940,400

20-Jun-08      9.20    9.80    8.61    9.45    29,372,600

19-Jun-08      9.63    10.21 8.97    9.06    42,721,900

18-Jun-08      9.06    9.87    9.06    9.63    33,823,500

17-Jun-08      10.08 10.17 9.08    9.15    19,819,000

16-Jun-08      10.03 10.28 9.38    9.99    20,957,400

13-Jun-08      11.20 11.40 10.08 10.09 20,558,800

12-Jun-08      11.10 11.50 10.92 11.20 17,708,800

11-Jun-08      11.50 11.68 10.91 11.14 18,782,200

10-Jun-08      12.47 12.48 11.77 11.77 20,251,200

6-Jun-08        13.30 13.30 12.97 13.08 9,777,200

5-Jun-08        13.00 13.47 12.90 13.18 13,169,600

4-Jun-08        13.60 13.62 12.90 13.00 19,279,000

3-Jun-08        13.39 13.94 13.31 13.62 25,322,200

2-Jun-08        13.30 13.57 13.05 13.41 18,514,400

30-May-08     12.95 13.65 12.76 13.34 26,263,200

29-May-08     13.30 13.48 12.90 12.90 23,260,200

28-May-08     12.60 13.68 12.50 13.48 34,733,400

27-May-08     12.64 12.85 12.20 12.44 17,259,100

26-May-08     13.38 13.38 12.66 12.69 21,357,700

23-May-08     13.48 13.79 13.02 13.54 21,291,200

On 26th June 2008, the international oil hit a new high record. In New York and London, the oil prices are topped 140 U.S. dollars per barrel! This year, the international oil price continues to hike, looking at the trend of international market price of crude oil this year, we can only use a word to describe it – CRAZY! On January 2, 2008, New York crude oil futures prices exceeded 100 U.S. dollars per barrel, which already marked a new high record. Now it has broken through till reaching 140 U.S. dollars per barrel. With the skyrocketing oil price, the natural gas, as the cleanest fossil fuel energy, its development becomes more prominent. SDZ, who has the monopoly on gas industry will be further benefited and developed from the soaring international oil prices.

The advantages of natural gas reflect in the following areas;

In environmental protection, natural gas is the cleanest fossils fuel in the energy, has very few of its impurities. Theoretically, it does not cause pollution when burning. Moreover, it reduces carbon dioxide by 25 percent, sulphur dioxide by more than 50 percent, and nitrogen oxides by 40 percent.

On the economic front, at present, based on 1,000 kcal per heat, according to the current market price of gas, the expenditure of natural gas is lesser than the liquefied petroleum gas and through the gas pipeline. Since China's natural gas prices subject to government’s control, the price of the residential natural gas has been the same – not increased. Therefore, we believe when the oil price is hiking, the demand for gas will play a significant role in stimulating the development of the gas industry.

Shanghai DaZhong Gas is engaged in gas-gas distribution, sales and service in one of the large-scale cities, its sales value accounts 40% in the market share. SDZ Gas was established in September 28, 2001, with the registered capital of 800 million yuan. On December 26, 2003, SDZ Gas became part of Shanghai Gas (Group) Company Limited.

Shanghai Gas (Group) Co., Ltd. and SDZ each holds 50 percent shares. In addition, SDZ’s investments in other gas enterprises include Shanghai DaZhong Gas Investment and Development Co., Ltd., Nanchang City Gas Co., Ltd., Nantong Gas Co., Ltd., Shanghai Chongming Gas Co. Ltd. and so on.

In fact, SDZ’s gas business has been growing steadily. Its users have been developed from 1.194 million in 2001 to 1.509 million in 2006, average annual growth rate of 5%. Among them, natural gas users of the gas proportion rate of 4.65% in 2001 rose to 39.23% in 2006. Gas sales of 969 million cubic meters by 2001, rose up to 1.506 billion cubic meters by 2006, with an average annual growth rate of around 10%. Of these, the total gas sales of 4.98% in 2001 up 40.93% in 2006. In the development of gas fields, gas air-conditioning has become a bright spot; gas CHP is developed, gas heat generator, gas dryers, gas fireplaces, and other residential gas equipments soon to enter the market. The air-conditioning gas, as of the end of 2006 the usage of artificial air-conditioning gas in 2001 from 2.2% developed to 4.28 percent in 2006.

With natural gas unparalleled advantages, coupled with SDZ’s regional gas monopoly position in the industry, the company is expected to have a high-speed development. Recently, the Company announced that on June 17 and 18, the company has nine management staff acquired 53.42 million shares from the secondary market. This fully demonstrates the company's future prospects that worth investors’ positive expectation.