Hi Zen, I am doing fine with Synear. My reasons for buying Synear have not changed. The recent happenings do not alter my reasons. I know it will be for a long while before it happens but when it does, I am expecting decent upside.
Synear's 3Q profit continued southward. The cash balance has shrunk because they are building new infrastructure. Not inspiring at all.
After that, came the the contaminated food issue. The management's guidance is highly negative:
"Consequently, the Group expects that its sales in the fourth quarter may be negatively affected. In addition, the Group continues to face cost pressures from rising raw material prices and labor costs. The Group therefore expects the economic climate and business conditions to remain very challenging in the next reporting period and in the next twelve months."
The one positive is that the NAV is very high at 44 SG cents, compared to the stock price of 11 cents. It's too huge a discount.
Stocks move up and down for many reasons.
You may like to consider your reason for buying this stock before executing the trade.
2012/2013 would turn out to be a long winter for many companies especially Chinese companies. I do however, Synear would be a company that can withstand this period.
Reason for this belief ? This Company has been listed for many years and their products can be seen in most of the major supermarkets in China and Hong Kong. The pricing and quality are inferior compared to established names like æ¹¾ä»ç 头. But still managable.
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