Very good recommendation by nextinsight on SunVic Chemical now is doing $0.74. This is one of the low capital S-Chip investments continue to shine from a low price of $12.5. If you have been following this forum closely, you would made some bucks out of it.
Sunvic’s results were certainly excellent. However, the company has commented in its results that they “anticipate new AA production capacity to come on-stream within the industry in the PRC, which may have some effect on the selling prices of AA. Rising oil prices may also impact our cost of production.”
From the comments, we can deduce that competitors are coming in for a slice of the cake and profit margins will be affected sooner or later. Such competition is to be expected in every lucrative business sector. It seems to me that the easy money to be made from this stock is over and latecomers would be taking on higher risks for an uncertain quantum of profits. Insiders had started selling some of their holdings a few months back.
S-chips (selective ones) may yield very lucrative profits for investors during certain time period but holding any of them for an indefinite long term is also highly risky, as history has shown that, thus far, all S-chips went through volatile cycles, with many fallen by the way side in a down cycle. So far, no S-chip has made the grade of a “blue chip”.
I agree with observer2. The going could get tougher, and I have cashed out of Sunvic with a tidy profit. Those who have greater insights into the future of Sunvic may accumulate but I dont have such insights nor assurance. On top of that, there is an unexpected turbulence in the stock market - that damn Mideast situation has to settle down before the stock market will be able to rally strongly.
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