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so is the FA report below good or bad? Maybe some good FA analyst can tell us?. Thanks. Vested in this counter but sold half of holding at 0.345 when there is sign of strong ceiling. Now still holding 20 lots.
Wednesday July 19, 5:21 PM
SINGAPORE, July 19 (Reuters) - Singapore-listed China Lifestyle , which makes fruit jellies, sweets and marshmallows, is betting that demand for its snacks will rise in China thanks to increasing disposable incomes.
China Lifestyle said on Wednesday it expects revenue to grow 20 to 30 percent in 2006 on the back of higher domestic consumption, and sees sales doubling by 2008 from 2005 on higher production capacity.
"Given the efforts to expand our distribution network in China, we foresee revenue will increase about 20 to 30 percent this year," Chief Financial Officer Sam Yap told Reuters in a telephone interview from Fujian, China.
Yap said net profit for 2006 would be "favourable" but declined to be more specific.
China Lifestyle says it has the second-largest market share in China for jelly desserts after unlisted Guangdong Strong Group Ltd. Jelly desserts generate nearly 90 percent of the firm's income.
The group's first-quarter net profit jumped nearly 40 percent to 29.1 million yuan ($3.64 million), boosted by rising demand in China and higher overseas sales.
Last year, the company's net profit fell 4 percent to 69.7 million yuan after its tax expenses more than doubled following the expiry of a tax concession for its Fujian factory.
"The company has positive long-term growth prospects. It is likely to see growing demand given China's huge population size," said Chew Sok Chuang, an analyst from Westcomb Financial Group who has a "buy" rating on the stock.
Shares of China Lifestyle, which has a stock market value of $78.8 million, have soared 51 percent in the last six months -- in contrast to the key Straits Times Index which has fallen 1 percent.
EXPANDING SALES NETWORK
China Lifestyle, which engaged popular Hong Kong movie star Cecilia Cheung as its public face for a year in 2004, plans to increase spending on advertising and promotions from about 5 percent of revenue now to about 8 percent of revenue by 2008.
China Lifestyle makes more than a 1,000 jellies and candies in various packagings and flavours under its proprietary brand "La Bi Xiao Xin", which are sold in most of China's supermarkets, including Carrefour and Wal-Mart .
Yap said the company plans to double its annual production capacity to over 150,000 tonnes of jelly desserts by 2008, which would result in its revenue doubling as well.
It also plans to boost the contribution from overseas sales -- where profit margins are higher -- to about 15 percent over the next three years, from 6 percent currently. Overseas markets include South America, South Korea, Russia and Southeast Asia.
Yap said the firm plans to expand its distribution network in China's smaller cities -- such as Dalian and Tsingdao -- which currently account for about 80 percent of revenue and generate higher margins.
"Our target is to increase our point-of-sales by about 30 percent each year," Han said. "That means we would have about four to five new stores selling our products each day."
China Lifestyle is increasing production capacity to meet rising demand. Its new plant in the northern city of Tianjin, which would be in the first phase of operation by the third quarter of 2007, is expected to boost production by more than 70 percent to over 100,000 tonnes of jellies annually.
China Lifestyle trades on a historical price/earnings ratio of about 7. Singapore-listed chocolate processor Petra Foods Ltd trades at a historical P/E of 18.7, Taiwanese snack maker Want Want Holdings at 12.5 and British confectionary giant Cadbury Schweppes Plc at 14.
China Lifestyle sees jellies sweetening profit
By Fayen WongSINGAPORE, July 19 (Reuters) - Singapore-listed China Lifestyle , which makes fruit jellies, sweets and marshmallows, is betting that demand for its snacks will rise in China thanks to increasing disposable incomes.
China Lifestyle said on Wednesday it expects revenue to grow 20 to 30 percent in 2006 on the back of higher domestic consumption, and sees sales doubling by 2008 from 2005 on higher production capacity.
"Given the efforts to expand our distribution network in China, we foresee revenue will increase about 20 to 30 percent this year," Chief Financial Officer Sam Yap told Reuters in a telephone interview from Fujian, China.
Yap said net profit for 2006 would be "favourable" but declined to be more specific.
China Lifestyle says it has the second-largest market share in China for jelly desserts after unlisted Guangdong Strong Group Ltd. Jelly desserts generate nearly 90 percent of the firm's income.
The group's first-quarter net profit jumped nearly 40 percent to 29.1 million yuan ($3.64 million), boosted by rising demand in China and higher overseas sales.
Last year, the company's net profit fell 4 percent to 69.7 million yuan after its tax expenses more than doubled following the expiry of a tax concession for its Fujian factory.
"The company has positive long-term growth prospects. It is likely to see growing demand given China's huge population size," said Chew Sok Chuang, an analyst from Westcomb Financial Group who has a "buy" rating on the stock.
Shares of China Lifestyle, which has a stock market value of $78.8 million, have soared 51 percent in the last six months -- in contrast to the key Straits Times Index which has fallen 1 percent.
EXPANDING SALES NETWORK
China Lifestyle, which engaged popular Hong Kong movie star Cecilia Cheung as its public face for a year in 2004, plans to increase spending on advertising and promotions from about 5 percent of revenue now to about 8 percent of revenue by 2008.
China Lifestyle makes more than a 1,000 jellies and candies in various packagings and flavours under its proprietary brand "La Bi Xiao Xin", which are sold in most of China's supermarkets, including Carrefour and Wal-Mart .
Yap said the company plans to double its annual production capacity to over 150,000 tonnes of jelly desserts by 2008, which would result in its revenue doubling as well.
It also plans to boost the contribution from overseas sales -- where profit margins are higher -- to about 15 percent over the next three years, from 6 percent currently. Overseas markets include South America, South Korea, Russia and Southeast Asia.
Yap said the firm plans to expand its distribution network in China's smaller cities -- such as Dalian and Tsingdao -- which currently account for about 80 percent of revenue and generate higher margins.
"Our target is to increase our point-of-sales by about 30 percent each year," Han said. "That means we would have about four to five new stores selling our products each day."
China Lifestyle is increasing production capacity to meet rising demand. Its new plant in the northern city of Tianjin, which would be in the first phase of operation by the third quarter of 2007, is expected to boost production by more than 70 percent to over 100,000 tonnes of jellies annually.
China Lifestyle trades on a historical price/earnings ratio of about 7. Singapore-listed chocolate processor Petra Foods Ltd trades at a historical P/E of 18.7, Taiwanese snack maker Want Want Holdings at 12.5 and British confectionary giant Cadbury Schweppes Plc at 14.
buy, wait and see... :-)
oh! another TA purist!
care to share your methodology?
care to share your methodology?
didnt have the info which you stated, i am 95% TA guy so, i hardly read news except for fed reports. anyway thanks for the good news you stated. quess it will help to push the price higher some more and faster.
40cents is a safe estimate for chinalife which is 70% reachable. however, it is still only 70% chance thus invest with care.
Pro of this counter:
the S/L is the nearest to the current price thus the lose is minimal. comapred to other china counters, whose prices are abit to far from my S/L target
Con:
the volume is lower compare to the other china counter and price move slower. Low volume could be doudle edged sword thus buy with care.
RMB to appreciate by 8% per yaer for next 10 years ? Chine GDP to grow by 10% per year for next 10 years ?
hi cashiertan,
where did you get the target price and date from?
where did you get the target price and date from?
Hmm this counter is alive again after heavy sell down. Maybe some expert may like to check this counter out.
Current price : 0.33
Target price : 0.4 S/L: 0.30
Estimated Time to target price: Aug 06