InvestIdeas

Oil maker aims to soak up $500m by Beth Ye, The Standard HK

China Corn Oil, which delisted from the Paris bourse this month, will now list in Hong Kong in an attempt to tap up to HK$500 million.

The switch comes as the mainland's largest edible corn oil producer firm tries to expand sales on its home turf - its main market.

About 99 percent of China Corn Oil's products were sold in the mainland in the first half of the year, according to chairman and chief executive Wang Mingxing.

The company plans to boost its retail business by launching its own brands, Wang said. He hopes retail sales can account for up to 50 percent of total turnover from 15 percent currently.

Wang said the proceeds from its initial public offering will also be used to raise production capacity.

The firm has seven offices covering 20 provincial capitals. Wang is now seeking to expand into second- and third-tier cities.

Output in the first half was 66,000 tonnes compared with 76,600 tonnes for the whole of last year. The firm's production last year represented 30.6 percent of the mainland's total.

Its net profit last year was 91 million yuan (HK$103.32 million), with net profit margin at about 9.8 percent.

China Corn Oil's public offer opens on December 8 and trading is due to start on December 18, sources said.


http://www.thestandard.com.hk/news_deta ... 91130&fc=1

From Phillips:-


Valuation

We estimate 2009E and 2010E EPS to be HK$ 0.22 and HK$ 0.34 respectively. With respect to the indicative price range, this implies 7.47x – 11.2x times 2010E earnings per share.

By referencing similar peers in the food sector, we set the reasonable 2010E P/E to be 13x. 12-month target price is HK$ 4.47 and the upside potential will be 16.1% from the upper end of the price range.


Risk

1) Fluctuation in prices and the availability of raw materials
2) Reliance on suppliers to acquire corn embryo
3) Reliance on Shandong Mingda which has been supplying steam and electricity to the company during the track record period

China Corn Oil opens its retail book today to raise HK$449.75 million to HK$673.75 million. Sources said the institutional portion of the corn oil manufacturer's offer was fully covered.

Source: The Standard HK

China Corn Oil jumped 21.45 percent to HK$4.36 from its offer price of HK$3.59.

Total turnover amounted to HK$33.59 million with 7.79 million shares changing hands.

Not vested.

DJ MARKET TALK: China Corn Oil +18.4%; Own Brand Key For Success
December 18, 2009

1041 [Dow Jones] NEW LISTING: China Corn Oil (1006.HK) +18.4% at HK$4.25, but off early peak at HK$4.69, which looks unlikely to be revisited given continued broad market weakness. Fundmentally, stock now trading at 16.5X forecast FY09 P/E, undemanding for domestic F&B play. Key for future development may be for company to step up own brand business, with own brand sales (which enjoy higher margin) only accounts for 15% of total sales now.

Shenyin Wanguo Research forecast FY10/11 EPS of 27.7 fen/33.3 fen; tips first-day trading range of HK$3.85-HK$4.50, vs day's range so far of HK$4.21-HK$4.69. Trading brisk with 109.4 million shares exchanging hands already vs 175 million shares offered, making stock 5th most heavily traded.

Source: Dow Jones Newswire

Not vested.

Financial Highlights

The Group recorded revenue of approximately RMB1,164 million for the year ended 31 December 2009, representing a growth of approximately 24.6% over the revenue of RMB934 million in 2008.

The Group recorded profit attributable to shareholders of approximately RMB120 million for the year ended 31 December 2009, representing an increase of approximately 31.4% over the profit attributable to shareholders of approximately RMB91.4 million in 2008.

The basic earnings per share attributable to owners of the Company amounted to approximately RMB36.17 cents for the year ended 31 December 2009, as compared to approximately RMB28.11 cents for the year ended 31 December 2008.

http://www.hkexnews.hk/listedco/listcon ... 415021.pdf

Not vested. From Dr. Check, The Standard HK:-

You may have heard that some restaurants in China are using recycled oil.

There are two types. One is oil used by the eatery. After treatment, black oil becomes clear.

The second is oil collected from Peking ducks and recycled. Both kinds are toxic.

Dr Check hopes mainlanders will be more careful about their health and buy healthy edible oils such as corn oil and olive oil.

China Corn Oil (1006) was listed last December. Its price shot up from HK$4 to HK$8.50. Then it underwent a correction before finding support at HK$5.

China Corn closed at HK$5.09 yesterday, 12.3 times its historical price- earnings ratio. As such it is not expensive.

来了 来了

Nice breakout from a 3-month consolidation.

And it dropped 10% today ....

==============================================

The Group’s profit attributable to owners of the Company decreased by
approximately 17.2% from RMB53.6 million for the six months ended 30 June 2009
to approximately RMB44.4 million for the six months ended 30 June 2010, which
included:
(1) the share based payment expenses for share options granted in May 2010 to Directors and employees of the Group of approximately RMB3.7 million;
(2) the additional legal and professional fees as a result of the Company’s listing on the
Main Board of The Stock Exchange of Hong Kong Limited on 18 December 2009
(“HK IPO”) of approximately RMB0.9 million; and
(3) the exchange loss that arised on the proceeds from HK IPO of approximately RMB0.8 million.

Should these items were excluded, the Group’s profit attributable to owners of the Company would have been approximately RMB49.8 million (30 June 2009: RMB53.6 million) (“Adjusted Profits”), representing a decrease of approximately 7.1%.

http://www.hkexnews.hk/listedco/listcon ... 826007.pdf

vested