What do u  guys think now that Yamada has sunk to 12 cents? The  business is not well understood not well publicised, could there be lots of room for improvement ? My reading is if and when the govt gives licence to log the eucalyptus trees, then it's a reversal of their tough times.

Am glad I didn’t buy Yamada too as I am extra kiasu when it comes to buying S-Chips.  In fact, am glad I am out of S-Chips  as don’t like Russian Roulette every quarter.

Their IPO was to raise money to buy eucalyptus logs. Over the last couple of years, most of their supposed profits has been going into buying eucalyptus logs.

The rationale was that once their eucalyptus plantations were ready for harvesting in 2012, they would be able to enjoy cost savings by reducing their need for leasing of synthetic logs from external parties.

Then a couple of months ago they reported that their eucalyptus plantations have not yet been granted license to harvest by the government but that this should not have any material impact on earnings or NAV.

Now they issue profit warning that they will make a loss due to loss in fair value of biological assets (eucalyptus plantation) by the independent valuers. Valuation is primarily based on expected future cash flows, but if the government won't grant them license to use them, then what expected future cash flows can they expect from their eucalyptus logs?? Given this new development, how serious is the loss in fair value? 

Furthermore more than half their NAV is based on the values of their eucalyptus plantations, which is extremely subjective, difficult to value, leaving lots of potential loopholes and is has now been devalued (we don't know yet by how much) but it could be quite serious if the valuers take into the consideration that the local government wont grant them any license to harvest the logs. 

Am really glad I did not buy this one and I much prefer its peers like China Minzhong and Sino Grandness. Whether the big sell down yesterday was justified will depend on how serious the loss in fair value of their eucalyptus plantations is. Some may also ask how to guarantee that all that cash really went to purchasing eucalyptus logs, and why they didn't get approval from the government before going into such a huge investment! Also a bit puzzling that the chairman gave over 40 million shares to Mr Loke and Mr You as a gift. 

I understand they have not finalised their June 2011 financial results yet? Wonder why ?

Re Yamada Green 1H2011 results, appreciate if someone can explain why they only pay 4% income tax and when they'd start paying the standard 25% tax?