What happened to it? Every day going down, even though the broker reports have been very favourable and the placement of shares went to big names.
This market is puzzling.
Anchun is anxiously goingup ---- hahahaa... bad pun. The stock has climbed cautiously up from 18 cts to 23 cents. This morning, it is on the top volume list with 7.8 m shares traded by 10 am. Quite amazing. The announcement is coming/ Last time, speculation was that China XLX Fertilizer will be awarding Anchun follow-up contract to manufacture system. XLX is substantial shareholder of Anchun....
ANCHUN is in a sweet spot, expect contract deals soon
Anchun close at 17 cents, at historic low due to it's dismay 1st quarter results. So is an Chun a good buy now? It depends whether you believe the poor results is due to the lumpiness of it's business or that demand has falters. My take is, demand has indeed taken a hit but the dismay results is also very much due to the seasonality of it's earnings. Now, first what could go wrong for this company. 1) high coal prices, work like an double edge sword. It increase the cost of production of fertillizers and hence the bottom-line of these potential clients might then delay their expansion plans. But it could also spur these potential clients to upgraded their production systems to improve their costs. More importantly, it's the weather, that will determine if there is demand from agricultural sector.. By predicting weather is as good as tossing a coin. From various news sources, analysts expect coal prices to rise due to japan reconstruction demands. Some costal cities has seen the drought situation easing. Some positives. 1)Order book increase from 112 million to 157 million, although that is still some way off it's pre-ipo book of 256 millions. Inventories has increase from 54 million to 77 million while advances from customers remain stable. 2) china xlx and sinofert , 2 major cilents of amchun, remain cautiously bullish on demands of fertilizers in 2011. With china xlx pressing ahead with it's 4th plant. 3) management has insists that there is no cancellation of orders but delays in delivery of orders. As such, some of these orders might overflow to be captured either in the second and third quarters. Given that the is already being "punished " for it's poor results, steadily falling from 23 cents post dividends and 18.5 cents pre results to 17 cents. There is potential for some turnarounds in this company. Just my 2 cents worth
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