China CleanTech Index 2014 Annual Performance Report January 2015

Sydney, Jan 12, 2015 AEST (ABN Newswire) - The China CleanTech Index provides the definitive measure of the performance of Chinese cleantech companies that are listed on stock exchanges around the world.

The combined investment themes of China and environment provide a compelling case for investment. The sector remains volatile as it matures and reacts to environmental and industry development policy shifts. The quality and scale of the companies included in the sector varies widely and strong research into both sub-sectors and companies is essential before committing to the sector. However, the cleantech sector in China presents a very strong medium term investment thesis and the China CleanTech Index provides the first level of data to enable informed investment decisions to be made.

The cleantech industry is split into a number of sub-sectors as detailed in the table below. Each of the sub-sectors contains companies that have both environmental and economic benefits.

Biogas
Geothermal - Hot dry rocks and conventional
Biofuels
Low Emissions Transport Technologies
Carbon Trading
Solar Thermal and Photovoltaics
Energy Efficiency & Biomaterials
Waste Management & Recycling
Energy Storage & Fuel Cells
Water
Environmental Services
Wave, Tidal & Hydro
Green Buildings
Wind Generation

The cleantech sector is fundamentally different to Socially Responsible Investments (SRI) or Environmental, Social and Governance (ESG) performance. SRI and ESG look at incremental improvements in company performance and can be seen as 'operational hygiene' measures that find the 'best in class'. Cleantech focuses on companies whose output positively enhances the communities and ecologies in which they reside. It is about doing 'more good' rather than 'less bad'.

With over 160 companies falling under the coverage of the Index and with a combined market capitalisation of nearly 1.4 trillion Renminbi (US$222 billion), the China CleanTech Index presents for the first time a picture of the Chinese cleantech industry's growth in a single measure.

The Index is weighted by market capitalisation and is benchmarked against the following indices to show its relative performance:

- Wilder Hill New Energy Global Innovation Index (NEX) - which measures the performance of global clean energy stocks

- Cleantech Index (CTIUS) - which measures the performance of global cleantech stocks

- China Shanghai Composite Index (SHCOMP) - which measures the performance of stocks listed in Shanghai.

- MSCI World (MSCI) - which provides a measure of the performance of global stock markets.

The rules for the formulation and management of the Index have been developed with reference to global best practice.

The China Cleantech Index is updated each month and published on the SinoCleantech website at www.sinocleantech.com and on the Australian CleanTech website at www.auscleantech.com.au. It is published internationally in conjunction with Cleantech Investor (www.cleantechinvestor.com) and in China in conjunction with Top Capital (www.topcapital.cn).

Monthly results can be emailed directly to interested parties by subscribing at www.sinocleantech.com.

Differences to the other Low Carbon Indices in China

There are other stock market indices that track the performance of some of China's cleantech stocks. However, none of these is as comprehensive as the China CleanTech Index for the following reasons:

- All cleantech companies that have headquarters in Mainland China, Hong Kong and Taiwan are included in the China CleanTech Index, which provides much wider coverage than other indices.

- There is no lower limit to market capitalization for inclusion in the China CleanTech Index meaning that all cleantech companies are included. The China CleanTech 20 gives a measure of the performance of the large cap stocks in the sector.

- The China CleanTech Index excludes nuclear, clean coal and natural gas, which are not considered to be 'cleantech'.

- The China CleanTech Index includes biofuels, green buildings, biomaterials, carbon trading, geothermal and environmental services, all of which appear to be missing from other indices.

- The China CleanTech Index is rebalanced quarterly whereas other indices are generally only rebalanced annually.

China CleanTech Index Performance

The China CleanTech Index outperformed all but one of its four benchmarks for the month of December 2014 and recorded a gain of 5.1%.

The China CleanTech Index rose from 50.15 to 52.70 over the month of December recording a 5.1% gain. This compared to the NEX loss of 3.9%, the CTIUS loss of 1.9%, the Shanghai Composite gain of 20.5% and the MSCI loss of 1.7%. The China CleanTech 20 recorded a strong gain of 13.8% over the month.

Over the final quarter of 2014, the China CleanTech Index recorded a gain of 10.4%, outperforming all but one of its benchmark indices. Over the quarter, the NEX lost 9.7%, the CTIUS lost 1.4%, the Shanghai Composite gained an impressive 36.8% and the MSCI gained 0.7%.

For the 2014 calendar year, the China CleanTech Index outperformed all of its benchmarks other than the Shanghai Composite. For the full year, the China CleanTech Index recorded a gain of 18.8%, compared to the NEX loss of 3.2%, the CTIUS loss of 8.4%, the Shanghai Composite gain of 52.8% and the MSCI gain of 2.9%.

The twelve month gain is being driven by the China Hydro Index (+78.9%), including strong gains by China Yangtze Power and Power Construction Corporation of China (previously Sinohydro Group) and the China Water Index (+28.7%).

        2012   2013 12/2014  4Q14  2H14  2014  3Yrs(CCTI)  -16.5% 29.2%  5.1%  10.4%  20.8% 18.8% 28.0%(CCT20) -15.5% 24.1% 13.8%  23.9%  30.7% 18.2% 24.0%(NEX)    -5.5% 53.7% -3.9%  -9.7% -16.5% -3.2% 40.6%(CTIUS)   7.3% 37.0% -1.9%  -1.4% -12.1% -8.4% 34.6%  (SHCOMP)  3.2% -6.7% 20.5%  36.8%  57.9% 52.8% 47.0%  (MSCI)   13.2% 24.1% -1.7%   0.7%  -1.9%  2.9% 44.6%CCTI - China CleanTech Index CCT20 - China CleanTech 20 NEX - Wilder Hill New Energy Global Innovation IndexCTIUS - Cleantech Index SHCOMP - China Shanghai Composite Index MSCI - MSCI World 

The market capitalisation of the 165 stocks in the China CleanTech Index after its rebalance is RMB 1.38 trillion (US$222 billion) which has set a new all time high. This is a long way up from the Index's trough of RMB 604 billion in November 2012.

Best and Worst Stocks

The best and worst performers in terms of share price performance over the month, final quarter and full year of 2014 are shown in the table below.

Over the month, 9 companies recorded share price gains of more than 25% and 15 companies made losses of more than 25%. Over the quarter, 10 companies recorded share price gains of more than 40% and 9 companies made losses of more than 40%. Over 2014, 12 companies recorded share price gains of more than 75% and 6 companies made losses of more than 75%.

December 2014
Best Performers
Share Price Gain > 25%

LED International Holdings (LON:LED)
Fujian Longking (SHA:60038)
Tinci Holdings (LON:TNCI)
E-Ton Solar Tech (TSEC:3452)
Beijing Capital (SHA:600008)
Chengdu Xingrong Investment (SHE:000598)
Chongqing Water Group (SHA:601158)
Tianjin Capital Environmental Protection Group (HKG:1065)
Power Construction Corporation of China (previously Sinohydro) (SHA:601669)

Worst Performers
Share Price Loss > 25%

China Energy Recovery (CGYV:OTCMKTS)
Guangzhou Hongli Opto Electronic (SHE:300129)
Shenzhen Refond Optoelectronics (SHE:300241)
SmartHeat (HEAT:OTCMKTS)
RINO International (RINO:OTCMKTS)
China Solar & Clean Energy Solns (CSOL:OTCMKTS)Hanwha Solarone (NASDAQ:HSOL)
Suntech Power Holdings (NYSE:STP)
Advanced Battery Technologies (ABAT:OTCMKTS)
China BAK Battery (NASDAQ:CBAK)
Jiangxi Ganfeng Lithium (SHE:002460)
Shandong Sacred Sun Power Sources
China Industrial Waste Management (CWIT:OTCMKTS)
China Recycling Energy (NASDAQ:CREG)
Duoyuan Global Water (DGWIY:OTCMKTS)

Fourth Quarter 2014
Best Performers
Share Price Gain > 40%

LED International Holdings (LON:LED)
Ledman Optoelectronic
Tinci Holdings (LON:TNCI)Advanced Battery Technologies ABAT:OTCMKTS)
Beijing Capital (SHA:600008)
Chongqing Water Group (SHA:601158)
Guangdong Golden Dragon Development (SHA:000712)
Zhongshan Public Utilities Group
China Yangtze Power (SHA:600900)
Power Construction Corporation of China (previously Sinohydro) (SHA:601669)

Worst Performers
Share Price Loss > 40%

China Energy Recovery (CGYV:OTCMKTS)
Hanwei Energy Services (TSE:HE)
SmartHeat (HEAT:OTCMKTS)
RINO International (RINO:OTCMKTS)
China Solar & Clean Energy Solns (CSOL:OTCMKTS)
Suntech Power Holdings (NYSE:STP)
China Sun Group High Tech (CSGH:OTCMKTS)
China Industrial Waste Management (CWIT:OTCMKTS)
Duoyuan Global Water (DGWIY:OTCMKTS)

Full Year 2014
Best Performers
Share Price Gain > 75%

Cofco Biochemical (Anhui) (SHE:300247)
LED International Holdings (LON:LED)
Ledman Optoelectronic
Tianli Environmental Protection Eng (SHE:300156)
Jiangsu Akcome Solar Science and Technology (SHE:002610)
Hong Kong Highpower Technology, Inc. (NASDAQ:HPJ)
Sound Global (HKG:0967)
Zhongshan Public Utilities Group.
Power Construction Corporation of China (previously Sinohydro) (SHA:601669)
CleanTech Innovations. (CTEK:OTCMKTS)
Jiangsu Jixin Wind Energy (SHA:601218)
Xiangtan Electric Manufacturing (SHA:600416)

Worst Performers
Share Price Loss > 75%

China Energy Recovery (CGYV:OTCMKTS)
China Sunergy (NASDAQ:CSVN)
LDK Solar (NYSE:LDK)
Suntech Power Holdings (NYSE:STP)
China Recycling Energy (NASDAQ:CREG)
Duoyuan Global Water (DGWIY:OTCMKTS)

Index Rebalance

The China CleanTech Index underwent its quarterly rebalancing at the end of December which took account of recent share issues and other corporate activity. Two companies were added to the Index after ongoing research into the Chinese cleantech sector. No companies were removed at this rebalance.

The added companies are:

Guangdong No.2 Hydropower Engineering. Co. Ltd. (SHE:002060) - Guangdong No.2 Hydropower Engineering Company undertakes various engineering projects including water resources and hydropower projects, municipal engineering projects, electromechanical installation projects, foundation engineering projects and real estate construction projects, among others. The Company is also involved in the generation of hydropower and wind power. The Company operates its business mainly in Provinces of Guangdong, Guangxi, Hunan and Yunnan, China. The Company has also been added to the China Hydro Index bringing the total number of constituents for this sub-index to 11.

Zhejiang Reclaim Construction Group (SHE:002586) - Zhejiang Reclaim Construction Group is principally engaged in the engineering construction and related technology services. The Company's engineering construction business involves in sea dykes, river courses, water reservoirs and city flood banks, among others. The Company conducts its business primarily in east China and southwest China. The Company has also been added to the China Water Index bringing the total number of constituents for this sub-index to 29.

Component Sub-Indices

To provide an analysis of the China CleanTech Index, eight sub-indices have been developed. The performance of each of these sub-indices over the last five years and the current quarter are shown in the table and charts in link below.

Five of the eight sub-indices recorded gains for the quarter. The best results were the 50.6% gain for the China Hydro Index and the 22.4% gain for the China Water Index. The worst results were recorded by the 21.3% loss from the China Storage Index and 13.9% loss from the China Solar Index.

Over 2014, four of the eight sub-indices recorded gains. The best results were the 78.9% gain for the China Hydro Index and the 28.7% gain for the China Water Index. The worst results were recorded by the 17.2% loss from the China Storage Index and 13.2% loss from the China Waste Index.

Index Component Companies

The 20 largest Index constituents by market capitalisation on 31 December 2014 are provided in the table below. These stocks will be the constituents of the China CleanTech 20 until the Index rebalance on 31 March 2015.

In the China CleanTech 20, the greatest sub-sector representations are Water with nine companies followed by Wind with three companies.

New entrants to this list at this rebalance are Zhongshan Public Utilities Group, Fujian Longking, Beijing SPC Environment Protection Tech and Tianjin Capital Environmental Protection Group. These have taken the place of Sinovel Wind Group, Hareon Solar Technology, Sichuan Tianqi Lithium Industries and Beijing SJ Environmental Protection and New Material.

1 China Yangtze Power (SHA:600900)
2 Power Construction Corporation of China (previously Sinohydro) (SHA:601669)
3 China Longyuan Power Group Corp (HKG:0916)
4 Chongqing Water Group (SHA:601158)
5 China Everbright International (HKG:0257)
6 Beijing Originwater Technology. (SHE:300070)
7 Xinjiang Goldwind Science & Technology (SHE:002202)
8 Beijing Enterprises Water Group (HKG:0371)
9 Tsinghua Tongfang (SHA:600100)
10 Beijing Capital (SHA:600008)
11 Guangdong Golden Dragon Development (SHE:000712)
12 Sound Environmental Resources. (SHE:000826)
13 Chengdu Xingrong Investment (SHE:000598)
14 GCL-Poly Energy Holdings (HKG:3800)
15 Huaneng Renewables (HKG:0958)
16 Beijing New Building Materials Public (SHE:000786)
17 Zhongshan Public Utilities Group. (SHE:000685)
18 Fujian Longking (SHA:600388)
19 Beijing SPC Environment Protection Tech (SHE:002573)
20 Tianjin Capital Environmental Protection Group (SHA:600874)

Index Profile

The profile of the constituent companies that comprise the China CleanTech Index provides some context for its performance. The 165 constituent companies are listed on twelve different exchanges, although 75% of them are listed on the exchanges in Shanghai, Shenzhen and Hong Kong. There are a further 14% listed on exchanges in North America.

When considering the total market capitalisation on each exchange, the figures show an increased focus on the Chinese exchanges. With only 21% of the companies, the Shanghai Exchange holds 42% of the Index's total market capitalisation. Combined with Shenzhen and Hong Kong, these three exchanges hold 97% of the total market capitalisation.

To view the complete report, including charts and tables, please visit:
http://media.abnnewswire.net/media/en/docs/79081-2014-YEAR-ENG.pdf

About Sino CleanTech

Sino CleanTech publishes the China CleanTech Index and facilitates Chinese Cleantech investments and provides services to Government agencies across Asia to help stimulate investment in the Cleantech industry. These investments include looking at listed cleantech stocks and direct investment into projects and companies. Sino Cleantech is active in facilitating:

- Investment from Chinese investors into cleantech in both China and internationally; and

- Investment from international investors into the Chinese cleantech market.

Please contact us if you are looking for funding or seeking investments.

 

Contact

Sino CleanTech WWW: www.sinocleantech.com