China Biodiesel Share Discussion Threads

[venture traveller] 24/2/2010 15:15

Hi Tim,

You talk about a div, when do you expect the div to be paid?
Presumably it is reliant on the company making significant profits. So, how can you be certain this is the case?

VT

[tim00] 20/2/2010 08:48

Re: HAIK, the debt is the problem. They need to make profits to make inroads into the debt.

On CBI, the RMB exchange rate is now 10.5 to the £. This further increases the value of dividend payments to UK shareholders. And I'm confident that CBI will do very well in 2010 H1. In order to overturn the profits warning so quickly in Q4 last year and report profits in H2 so close to H1, the volume and margin must have picked up significantly. With the Chinese economy growing so quickly, I can't see why that won't be maintained in 2010. Note also that government subsidies were similar in 2010 to 2009, so the company is becoming less reliant on support. Currently, I'm projecting profits of RMB 10 million in 2010 H1. Should be achievable. Translates to a p/e ratio of 2.3 at the current sp, and any dividend payment would imply a very high yield. Even if CBI remains invisible to UK investors, it will be a very attractive hold on income yield grounds.

[qipincha] 19/2/2010 17:04

is HAIK is in such a bad position?
I feel they are still growing

[tim00] 19/2/2010 09:00

unfortunately I still hold quite a lot of HAIK. I think people are being much too pessimistic on the chances of its survival, but I would agree that any recovery is still some way off there.

[qipincha] 18/2/2010 16:52

hi, anyone still in haike???
is it still alive?

[tim00] 15/2/2010 07:00

In fact, it's possible to infer a substantial improvement in margins in Q4, though I don't know of course whether that is being sustained in 2010.

[taurusthebear] 14/2/2010 21:59

Hi PP, sorry am travelling so don´t look in much.

I can´t see the share price getting much past 10p unless there is a positive outlook statement at results. The shares are cheap BUT that´s not a lot of good if people don´t know whether margins are set to get better or worse. Increased turnover was expected, that will only benefit the share price if margins improve such that profits flow to the bottom line.

In view of that haziness, I cannot have a target price, but when I sell I hope it will be above 10p! ;0)

[tim00] 12/2/2010 20:52

In my view, the company could now afford to reinstate a small dividend. (In 2006 and 2007 it was roughly 10% of annual profits: for 2009 that would equate to about 0.024 RMB per share, or about 0.228p per share, or £2.28 per 1000 shares.) Borrowing is low, and the dividend wouldn't be paid until around mid-year when the company would have another half year's cash flow. I'm going to suggest this to the company. It will be interesting to see if they comment, though possibly not. Anyway, I'm sure it would lift the share price significatly.

[jailbird] 11/2/2010 14:17

tim00,


ok thanks.

[tim00] 11/2/2010 14:13

China Strategy did not have a notifiable (3%) holding, and as the shareholding was nearly 2% it's safe to say that was their entire holding.

[jailbird] 11/2/2010 14:08

do we know how mcuh China
Strategy Investment Management Co hold?

just read the RNS properly

[jailbird] 11/2/2010 14:07

for him to buy that much stock, means there must be a larger seller too.

We do not know how much stock is around to sell.
So overhang may still exist

[tim00] 11/2/2010 12:11

The founder now owns 74% of the share capital! At least his interests are aligned with ours!! (I doubt he wants to privatise the company.) And it removes a stock overhang from the market. But little substantive news now until the half-year results for 2010, or when a trading update is made. I'm discounting the April results for 2009, now that we know profits for the year were about RMB 11 million (over 2p per share).

[poggy pig] 09/2/2010 22:17

Good stuff TTB. Do you have a rough target price?

[abbey8] 09/2/2010 21:35

like to invest here, but GRANTS from the government is a problem.

[poggy pig] 09/2/2010 17:19

Are you still in TTB?

[tim00] 09/2/2010 16:04

q, the lower debt level is the reannouncement of the statement at the bottom of the interims, nothing more (at least that's what I understand!) But remember the profit warning stated profit in H2 would be substantially lower than in H1, whereas in the event they were very similar. That suggests the recession is behind us now and profits should now start to recover.

[qipincha] 09/2/2010 14:46

nice correction.

lower debt level is the key

[tim00] 09/2/2010 14:08

relishing, government support is more than the profit figures. That's why a biodiesel company makes a profit in a global recession. But the support is not going away and the Chinese economy is booming. And CBI trades on an historic p/e of about 4.5.

[relishing] 09/2/2010 13:48

How big a contribution would the subsidies and grants make towards that profit figure? Just concerned if these were reduced or taken away the profit would be significantly less?

[poggy pig] 09/2/2010 13:30

Just bought in. This is too cheap!

[mikeja] 09/2/2010 08:44

Sorry Tim,quite correct.Read the figs too quickly.

[tim00] 09/2/2010 08:08

Not quite Mike. Post-tax profit in H1 was RMB 6 mn, H2 will be about RMB 5 mn therefore. There must have been a great improvement in Q4, which bodes well going forward. China growing very strongly, just avoid Chinese property. Congrats Mike on your substantial WCC holding, that's going to be an awesome investment over the next 3-5 years.

[mikeja] 09/2/2010 07:52

Also H2 much better than H1,profits 7m RMB against H1 of 4m.