Post Reply
121-140 of 290
Bingo , good news, FA people please confirm my analysis.
Proposed placement of up to 36,000,000 new ordinary shares in the capital of the company at the price of SGD 0.735.
Key point is: Luzhou has entered into a placement agreement with China Construction Bank!!!! It's china construction bank.. heee.. net proceeds of SGD 25.7 millions.
But, why Luzhou needs the money?
They are expanding business!!!
5.1 millions to finance the construction of a production facility at Pengshan, Sichuan,..... etc , etc...
7.9 millions to contruct new production lines for special feeds products at production facilty at Yishui, Shandong...
7.9 millions to contruct new production lines for high fructose syrup at the production facility at Fushun, Lianing.
I expect morning price will be SGD 0.85.. But, I might hold this stock for short-to-mid term to see how it grows....
cheers for those vested... heeee...
| sohguanh Member |
Posted: 12-Jan-2007 14:47 |
 x 0  x 0 |
Brokerage firms force sell but if sell at a price lower than the contrarian buy in price, then will the brokerage firm blacklist that contrarians or force him to pay a penalty? |
No penalty, only thing is whether the current market price at that point of time.
Blacklist? Don't think so, just tell them, you plan to sell anyway (just that you can't during a halt).
Its not a must to pickup whatever shares one buy. If you understand what i mean. =) For eg. a bad judgement trade.
Anyone kena penalised by brokerage firms before?
| sohguanh Member |
Posted: 12-Jan-2007 14:25 |
| x 0 x 0 |
The 3 days date line to pay up is inclusive of days when the stock is halted? Hmmm.... I feel sorry for the contrarians. Hope they have the capital to pay up. |
It is ok if contranians no $$ to pickup after the Due-day.
The broker will just force-sell off once the halt is lifted.
[correct me if i'm wrong]
Hi Jackjames,
No worry lah. Probably good news for all vested. Hope for you.
Super laggard according to CIMB............target $1.02
Maintain Outperform. Luzhou Bio-Chem is well-positioned to benefit from the
growing demand for sugar substitution play. It has sustainable margins and volume
growth driven by a broadening customer base in the PRC and export markets.
growing demand for sugar substitution play. It has sustainable margins and volume
growth driven by a broadening customer base in the PRC and export markets.
? New customer lends credibility. Luzhou recently succeeded in pre-qualifying for
the supply of HFCS to a renowned carbonated drink manufacturer. The group plans
to supply HFCS through its four existing plants. The securing of this new customer
lent substantial credibility to the quality of Luzhou?s products and aids the group?s
ambitions to grow the export market for corn sweetener.
the supply of HFCS to a renowned carbonated drink manufacturer. The group plans
to supply HFCS through its four existing plants. The securing of this new customer
lent substantial credibility to the quality of Luzhou?s products and aids the group?s
ambitions to grow the export market for corn sweetener.
? Capacity expansion to raise ceiling for growth. Expanded manufacturing
capacity in Shandong and the new JV plant in Sichuan are set to increase the
group?s total annual production capacity to 940,000 tonnes in FY07 (+45% yoy).
Average utilisation rate for corn sweetener facilities is estimated to rise to 92% for
FY08 (from 78% in FY06), reflecting our forecasted topline growth to over Rmb2m
in FY08 (from Rmb1.4m in FY06).
capacity in Shandong and the new JV plant in Sichuan are set to increase the
group?s total annual production capacity to 940,000 tonnes in FY07 (+45% yoy).
Average utilisation rate for corn sweetener facilities is estimated to rise to 92% for
FY08 (from 78% in FY06), reflecting our forecasted topline growth to over Rmb2m
in FY08 (from Rmb1.4m in FY06).
? Sustainable growth with higher margins and operating efficiencies. Focus on
the higher margin HFCS and the growing of its export market share (Chinese corn
sweetener exports trade at 5-10% higher ASP to local sales) boosts Luzhou?s
margins. Stable corn costs (77% of COGS), savings from access to its own private
supply of power and water, as well as the strategic location of production facilities,
contribute to keeping costs under tight control.
the higher margin HFCS and the growing of its export market share (Chinese corn
sweetener exports trade at 5-10% higher ASP to local sales) boosts Luzhou?s
margins. Stable corn costs (77% of COGS), savings from access to its own private
supply of power and water, as well as the strategic location of production facilities,
contribute to keeping costs under tight control.
? Target price of S$1.02. We keep our target price of S$1.02 intact, based on a
blend of P/E (10x CY07) and DCF (12% WACC, 2% terminal growth) valuations.
We like Luzhou
blend of P/E (10x CY07) and DCF (12% WACC, 2% terminal growth) valuations.
We like Luzhou
DBSV analyst Germaine Khong told Reuters that Luzhou's management had secured the contract recently, but declined to give more details at the company's request.
The firm's plants in Liaoning, Shandong, Henan, and Shaanxi provinces in China will supply high fructose corn syrup to the new customer, DBSV said in a note to clients on Monday.
"We believe this new contract to be a breakthrough for LUBC as so far, carbonated drink manufacturers in China have been using cane sugar," analysts Khong and Paul Yong said in the note.
DBSV has a "buy" recommendation on the stock, with a 12-month target price of $1.05.
Luzhou
Corn price rose about 20% mom in Sep 06, the highest level in the last 3 months. However, corn prices are softening due to the harvesting season in Oct. Raw materials account for about 83% of its COGS, with corn forming avout 70% of raw materials used. It has a team of crop specialists that assists the group in the procurement and management of good quality corn supply. It utuilised proceeds from its recent IPO to stock up on corn supply and so wasn't overly affected by the spike in corn prices.
CGK has a price target of $1.02.
Global sugar prices have been surging since earlier this year to their highest levels in more than 2 decades because Brazil, the world's largest producer, has been converting more of its crop to ethanol to produce automotive fuels.
International supply has also been cut due to severe weather problems in Thailand, the world's 2nd largest producer.
A severe drought and subsequent flooding in sugarcane-producing regions decimated harvests there this year.
Sugar prices have since declined to mid-Nov '95 levels.
Luzhou is cheonging.. any idea?
Westcomb has a price target of $0.765, equivalent to 11x FY07 PER, at a 30% discount to its global peers.
Key risks include over-investment by industry players (they have been expanding capacity agressively), decline in sugar priices and increase in corn prices.
The price disparity is lessening with the recent decline in crude oil and sugar prices. Moreover, the price of corn is also expected to increase with the growing demand for its downstream products (eg. corn sweeteners and ethanol). These 2 concurrent trends may eventually impose some presure on margins.
CIMB-GK has increased its price target to $1.02 after it raised its 2007-2008 earnings estimates to factor in contributions from the new venture of the China-based producer of corn sweeteners.
The company's JV with China's Sichuan Jin Tai Bio-Chem will operate a corn sweetener production plant, from the second quarter of 2007, which will have annual production capacity of 140,000 tons.
"The new plant will enable the group to extend its market reach to China's South-Western region, including Chengdu and Chongqing," CIMB-GK analyst Gary Ng said in a client note.
"We believe that with this joint venture, not only can Luzhou secure new customers but it will strategically reduce potential competitors in the region," he added.
CIMB-GK expects Luzhou's net profit to grow to RMB120.6m this year from RMB72.6m in 2005, then to RMB201.9m next year, and to RMB261.5m in 2008.
"We like Luzhou for its exposure to increasing sugar substitution, sustainable margins and volume growth," said Ng who has a "buy" call on the stock.