ChinaLife   

ChinaLife is alive again

its proposed, awaiting approval

 

This fellow is going to be delisted at 0.178.

 

DBS Vickers - China Lifestyle Food & Beverage (CLF SP)
Food for thought: Exciting times ahead
Buy S$0.50 Price Target : S$ 0.69

3Q  results  were  above  our  expectations  due  to higher volumes, better
margins, cost controls and lower distribution expenses.

Traditionally  the  weakest  quarter,  revenue  for  3Q grew 30%, while net
profit  surged  62.5%  to  RMB17.1m.  Gross  margins  improved  by 1.7 ppt,
resulting from new product launches and cost control measures. As a result,
9M  net  profit  registered a 12.5% growth, up from a moderate 3% growth at
half time (1H07).

Operating  cashflow  remained  healthy,  generating   RMB45.4m in cash. Cash
conversion  cycle  was  a  good -35days. Average trade receivables turnover
days  increased  from 26 days to 32 days, while inventory days decreased to
20 days, from 34.

 

China Lifestyle?s 3Q2007 net profit surges 62.5% to RMB 17.1 million

- 3Q2007 sales up 30.5% to RMB 149.6 million, buoyed by robust demand and expanding distribution network.
- Effective cost containment bolstered gross margin improvement to 39.9% from 38.2%.
- Foundations laid for future growth.

Singapore, 5th November 2007 - China Lifestyle Food and Beverages Group Limited ("China Lifestyle" or "the Group"), a fast moving consumer goods company with the 2nd largest market share for jelly desserts in the PRC market under its proprietary "Labixiaoxin" brand name, reported a 62.5% surge in net profit to RMB17.1 million for the three months ended 30 September 2007 (3Q2007) on accelerated demand for its popular jelly and  sweets products.

 

Finally, it take off.. .

Any good news coming???

 

Is moving....

 

Good post. tis counter hv gd potential, low PE, gd growth. Cheers!

 

Kim Eng has just raised target to $0.57!!!!!!!!!CHEONG AH!!!!!!

�� Venturing into gummy sweets

China Lifestyle (CLF) is setting up a 50/50 JV with KLSE-listed Cocoaland Holdings to

manufacture and distribute fruit gummy candy products for the China market. The first

production line (annual capacity of 4,500 tonnes) in Fujian will be ready by Aug 07 with an

additional line coming onstream in 2008. The gummy products are set to hit stores in

2H07 contributing slightly to this year?s revenues. The group plans to ramp capacity to 10

production lines, increasing its gummy capacity by 45,000 tonnes within the next 3-5 years.

This coupled with new capacity additions in jelly production will effectively raise CLF?s total

capacity to ~200,000 tonnes (current: 80,000 tonnes) by end 2010.

�� Win-win tie-up will be profitable from FY08

Cocoaland is a market leader for fruit gummy in Malaysia; backed by >20-year track

record and a bottomline CAGR of 23.4% over 2002-2006. Its best selling products include

Lot100

expertise in fruit gummy candy production, CLF is poised to penetrate China?s gummy

candy market given its extensive 17,000 Point-of-Sales network. However, due to initial

start-up cost, earnings impact may only be felt in FY08. We forecast the JV to contribute

6.3% to the group?s FY08 bottomline and growing at a CAGR of 196% over FY08-FY10.and Sour+ range, which are well-received in Malaysia. Leveraging on Cocoaland?s

�� Capturing a slice of the fast growing China gummy market

According to Euromonitor, China?s pastilles, gums, jellies and chews market enjoyed a

CAGR of 8.47% during 2001-2006, reaching a market value of RMB4.3bn. Sales in this

segment is expected to grow rapidly at a CAGR of 12% for the period 2006-2011. Given

the highly fragmented nature of the confectionery industry in China, strong branding and

good quality products are two essential factors that would give a differentiating niche. CLF,

with its eye-catching packaging and aggressive A&P (~6% of sales), is set to become a

major player in the industry. Backed by

best selling products, CLF is well positioned to gain a significant share of the expanding

gummy market in China. This competitive advantage will be further enhanced in view of

the huge potential size and rosy growth prospects of the Chinese consumer market.Labixiaoxin?s popular branding and Cocoaland?s

�� Cheap exposure to China consumer market

CLF is a promising Chinese consumer play, supported by valuations that are completely

undemanding. The stock is trading at a forward PEs of 11.4/8.2x for FY07/08 respectively,

vs sector median of 16.9/14.4x. Based on 13x FY09 PE and applying a 10% discount to

account for low liquidity and visibility, we are pegging the stock at a target price of S$0.57.

The valuation is conservative compared to the 14-16x PE which the market is ascribing to

some of its peers given that CLF is enjoys significantly higher EBIT margin of 20.7% and

ROE of 29.2%. In the past, CLF?s growth has been constrained by capacity limitations

(FY06 utilisation: >90%) but this is set to change by 2009 when the new Tianjin plant will

double its core jelly product capacity to 160,000 tonnes. Liquidity and visibility should

increase over time given the growing interest from institutional investors. With a 43%

potential upside and an attractive PE valuation, we reiterate our long term BUY

recommendation on the stoc

 

KimEng targets $0.465!!!!!!!! CHEONG AH

Initiating Coverage with Fair Value of $0.465

Target price is based on DCF valuation assuming WACC at 12.2%, terminal growth at 2% and a nominal 25% discount to value for firm size and liquidity risk, representing 11.7x FY07 PE. Overall, attractive buy with strong operating cash flows and sound business fundamentals. Recommend BUY for strong EPS growth, highlighting contribution from tax incentives commencing from 2008.

 

watch this counter.. may earn u xmas present..

 

UOBKH raised its FY08 net profit estimates by 5% to account for the contribution from the JV. It also lifted its target price to $0.45 as it assigns a higher valuation based on 9.6x FY07 PE from 9.0x previously. CLF deserves a higher valuation with its more diversified revenue streams and stronger brand equity.



The JV is a positive development as it expands CLF's product range and revenue streams and reduces CLF's reliance on jelly. The JV is likely to introduce other lifestyle F&B products under the LBXX brand such as cup noodles, instant noodles and mashed potatoes. The new products will increase the market presence of the LBXX brand and strengthen its brand equity. Forming the JV is the right move to help CLF become a branded lifestyle F&B company.



The JV combines Super's manufacturing capability in snack products and CLF's brand equity and distribution network in China. Super manufactures the Pringles brand of potato chips for P&G, while LBXX is one of China's top brands with more than 13,000 points-of-sale throughout the country. The JV is likely to leverage on the strengths of its parents to shorten the learning curve and break even within the first year. Based on its 32% stake and assuming a net margin of 8-10%, the JV could contribute Rmb5m-7m, or 4-6%, to CLF's bottom line in FY08.

 

Lookup for this counter, can consider to load if it break out and close abv $0.35

target price is 0.42+ within few months.

 

The JV is only $5m. Chance Cove is owned by CL's CEO. It is aiming for annual sales of RMB1b in 5 years. Retail sales of China's snacks market reached RMB25.2b in '05 and are estimated to reach RMB36.1b by '10.

 

Super Coffeemix, China Lifestyle and Chance Cove have formed a JV company to be known as Tianjin Super Lifestyle Food Development. The JV will manufacture and distribute convenience foods such as potato chips in PRC.



No big deal.

 

Jessie, Sorri iam not a FA guy so i dun know if it is good to enter now or not. Based on TA, i will not enter till it close abv 0.35 with decent volume.

 

HONG KONG (MarketWatch) -- China's central bank raised its benchmark one-year lending and deposit rates by 0.27% Friday as part of its ongoing attempt to rein in surging investment and loan growth.

The People's Bank of China said it was increasing its one-year lending rate to 6.12%, and the one-year deposit rate to 2.52%, according to reports.

It said the increases will take effect on Aug. 19. China last raised the lending rate in April to 5.85%, also by 0.27%.

The move is aimed at "curbing demand for long-term loans and the overly rapid expansion in fixed-asset investment," the bank said in a statement.

The deposit rate had not been changed since 2004.

 

Hi Cashiertan, would you be buying again in view of the hear say JV ?  Anyone else want to comment ?

 

Super Coffeemix and China Lifestyle are set to announce a $100 m joint venture, a source close to the deal said.

 

sold all at 0.33 yest

 

Yes, the report is good.



China Lifestyle has an estimated 5-8% of PRC's market share. Strong economic growth, rising affluence and strong retail consumption are driving demand for sweets and candies. The jelly market is projected to grow 15-20% a year.



Its new plant will increase annual production capacity from 60,000 ton to 150,000 ton within the next 2-3 years. Its current 13,000 points of sale will also be enlarged by 25-30% each year (targets 17,000 points by end-06).



UOBKH has a target price of $0.42 based on 9x FY07PER, in line with F&B consumer stocks listed on SGX and at more than 50% discount to Asian F&B companies.