Event description

The agricultural development seed industry signed a strategic cooperation agreement with the Institute of Genetics and Developmental Biology of the Chinese Academy of Sciences.

Event comment

The Agricultural Development seed Industry and the Institute of Genetics and Developmental Biology of the Chinese Academy of Sciences signed the Strategic Cooperation Framework Agreement in Beijing. The main contents of the agreement are as follows: 1. The two sides cooperate in many fields, such as research and development platform, breeding technology, breeding base, new variety approval, talent team construction, achievement transformation and so on, so as to jointly promote cooperation in all aspects of the seed industry innovation chain. 2. In line with the principle of "mutual benefit and common development", we are preparing to build a platform for seed industrialization, and the resulting R & D achievements such as new products and technologies will be given priority to foreign commercial development through this platform.

The Institute of Genetics and Development of the Chinese Academy of Sciences has outstanding scientific research capabilities in the fields of molecular breeding and transgenic breeding. Strategic cooperation will help the agricultural development and seed industry to make full use of in vitro resources and enhance the comprehensive competitiveness of the seed industry. At present, the Institute of Genetics and Development has 3 academicians, 3 people of the National Thousand talents Plan, 50 people of the 100 talents Plan of the Chinese Academy of Sciences, 12 chief scientists of the Chinese Academy of Sciences and other major national projects, focusing on genome structure and regulation, molecular mechanism of major diseases, molecular design of varieties and other fields. Eight joint molecular breeding centers focusing on rice, wheat, cotton and vegetables have been established in Yangzhou, Jiangsu and Jiaxing, Zhejiang, and a joint research center for northern japonica rice molecular breeding has been established in Harbin, Heilongjiang Province. We believe that the strategic cooperation with the Institute of Genetics and Development will help the agricultural development seed industry to further enhance its research strength in molecular breeding and transgenic breeding with the help of in vitro scientific research. (the company has signed a cooperation agreement with Boao Jingdian to increase the layout of research and development of transgenic technology), and make up for the shortcomings of scientific research in the process of establishing an agricultural and material integration platform, so as to enhance the core competitiveness in the seed industry.

The future of the company is as follows: 1. Under the background of the reform of state-owned enterprises, the integration of group resources is expected to accelerate. The detailed rules of land reclamation reform have been promulgated to remove obstacles to the integration of land resources in the reclamation area, and the reform of state-owned enterprises has been continuously promoted. Zhongnongfa Group, a major shareholder of the company, owns 4.3 million mu of domestic land (700000 mu of arable land), which does not rule out the possibility of future injection. 2. Build a scientific research platform to enhance the comprehensive competitiveness. The company strives to build a scientific research platform at the level of listed companies, obtain advanced scientific and technological resources through cooperation with external forces (domestic and international), and engraft them into subordinate enterprises at an appropriate time to give full play to their respective advantages and transform them into commercial varieties. 3. The strategic thinking of the company to build the agricultural material integration platform of central enterprises is clear. The first step is to form a large pattern of seed + pesticide through epitaxial expansion, and the second step is to strengthen it through internal integration, external research cooperation and building a service platform docking mode of "agricultural materials + farm + collection and storage".

Give a "buy" rating. We estimate that the company's EPS in 2016 and 2017 will be 0.14 yuan and 0.17 yuan respectively, giving a "buy" rating.

Risk hints: the acquisition price is too high; the construction of service system and the process of land reclamation reform are not up to expectations.