C&G Env Protect   

Hongbao share

gap up 2 days in the row

 

Strong fundamentals will drive the price up further.......

 

according to TA, it seems like a good entry point now..

 

thanks elfinchilde and cashiertan

 

most indicator pointing up except the price.. 

 

yep, bollies tightening. signs actually mixed; but direction is likely up. needs to break sustained above 0.72 for confirmed uptrend tho.

be careful of macrotrend though. dow's down; might affect sentiment for entire market. plus, sgx is softening. macro trend changing means techs change for counters. keep checking yr techs to see. good luck! :)

 

Bollinger band is narrowing, can any TA experts confirm this?

I am still learning. Thanks

 

 

heard it going up to 1 dollar... good to load more when it is still low.  good luck to all

 

From Kim Eng this morning!!!!!!!!

An Ongoing Makeover BUY Plant Visit Note

Making good progress with production expansion We visited C&G?s production plants in Xiamen-Longyan recently. The first plant, Longyan Chengguan Chemical Fibre Company, has three production lines capable of manufacturing 30,000 tonnes of differential PET chips per annum. The second plant, Longyan Chengguan Textile Company, manufactures 15,750 tonnes of yarns annually. We also saw the two upcoming production plants for PSF and compact combed yarns which are still under construction. The PSF plant is nearing completion, and is expected to start annual production 10,000 tonnes by 4Q07, while the plant for the compact combed yarns (annual capacity of 7000 tonnes) is expected to be ready by 1Q08. The existing plants are highly automated, with machine parts imported from Germany. Demand has been strong with utilisation currently at 91-95%. ♦ More strategic alliances could trigger re-ratings The management sees the recent strategic alliance with Septwolves (a first-tier consumer brand company in China) as an important endorsement of C&G?s product quality and product development capability. The group is seeking more of such collaborations with renowned brand-builders to further enhance recognition of C&G products. We also understand that the group is keen to engage distributors who represent extensive domestic and international brands in a bid to more quickly scale up C&G?s brand-building campaign and contract flows. A stronger flow of agreements could be a re-rating catalyst for C&G?s share price, as it points to strong market acceptance of its differentiated products which could deliver higher earnings quality. ♦ Strengthening earnings momentum We remain upbeat about C&G?s earnings momentum. In FY07, we expect earnings to rise 16%, mainly propelled by the enlarged production capacity of alkali-soluble PET chips (+53% since April 2006) and full-year contribution from 6000 tonnes of combed yarns. We expect earnings momentum to further accelerate at growth clips of above 25% Y/Y in FY08 and FY09. This is in view of cost-savings from in-house production of a key raw material - PSF (gross margin enhancement of 2-5%) from 4Q07, the kicking-in of contributions from compact combed yarn in from FY08, and the commencement of contributions from industrial bi-component fibres in FY09. New products, such as the compact combed yarns and industrial bi-component fibers, will be important growth drivers, as they command the highest gross margins (50%) among existing products and demand is expected to be strong. ♦ An undervalued China textile play, reiterate Buy with 40% price upside. C&G is currently trading at 10x FY07 PER, an attractive 29% discount to the valuations of comparables. Indeed, C&G?s present valuation is alluring, given its strong product pipeline in high-margin products and its resilient financial position. Recent interests on the high-end textile players have been strong which see the share prices of China Sky and Fibrechem soared above 10% last week. We believe valuation for C&G should catch up and the valuation gap between C&G and its comparables to narrow as C&G?s strong growth momentum and gross margin enhancement sets in over the next 2 years. Our fair value stands at S$0.95 based on the average of our PER (11.6x FY08 PER) and DCF valuations. Reiterate BUY.

 

Q2 will be another solid quarter fo C&G. Shouldn't have any problem hitting the 90c target price.

 

i'll not sell CG till it reaches $2, willing to wait, unless something's wrong with the co.

 

Load up while u can this counter TA looks for classic breakout soon.. 

 

China Sky and Sino Tech have CHEONG. This one will also CHEONG this soon! BUYYYYYYYYYYYYYY!

 

Support found .. bullish TA

 

thks fruitty

 

hi hogenterprise, let me know if u didn't receive.

 

fruitty, do u have a copy of KE report, if yes, plesase send to me @

hogenterprise@hotmail.com 

thks.

 

With new listed textiles company listed this yr (Foreland) and coming one (China Hongcheng), the listed China textile companies here may be worthed a look. The newer one(s) seemed to command a higher PE than those listed 2 yrs back.

C&G is a growth company with agressive expansion plan and big ambitions. Do take a look at the 22 pages Kim Eng report and read its past financial reports.

It's a stock not meant for contra. Needs to have holding ability.

 

Kim Eng issued a buy call of $0.95 on 29 Jun 07.

 

hi,

Westcomb target price -$0.94

CIMB target price -$1