Yes, that would appear to be the Skywatcher version of a combined "Sight Tube" and "Cheshire" collimator. Much the same price as the Orion. Should come with instructions. The peep hole, long tube and cross hairs are for correctly locating the secondary mirror. The peep hole and 45 deg angled shiny surface is to complete the collimation by adjusting the primary mirror until the reflection of the peep hole is centred (that's put simply - the instructions will be more detailed).
You might wish to read this thread:-
http://www.iceinspace.com.au/forum/s...ad.php?t=28643
In it, I compare a quality unit (the Orion, like the Skywatcher?) with an el-cheapo short Cheshire (the one there is ex Andrews, but you can get them most places). Just to let you know, I use the Andrews frequently to check after laser. I seldom use the Orion now.