Sino Grandness (26.5 cents) trades at about 3X FY2014 earnings. Chart: Yahoo!
Progress of IPO of Garden Fresh
Mr Huang has expressed confidence in submitting the required forms to the exchange before the bonds expire.
But the share price weakness suggests that the market does not think that Garden Fresh can get listed at all and the company will not have RMB 580m, let alone RMB 650m, to pay off bondholders.
Developments to be closely watched 
Huang Yupeng, CEO of Sino Grandness, view placards promoting his company's beverages at a trade fair. Photo: CompanyMr Huang has been buying Sino Grandness shares in recent times.
Investors are hoping that the Thai investors too will raise their combined 12.8 % stake in Sino Grandness as further demonstration of their faith.
Four corporate matters that will be closely watched are:
(1) will the international banks provide the contingency loans?
(2) will the next quarterly results to be released in May show a stronger cash position?
(3) will bondholders roll over their bonds in anticipation of a successful listing of Garden Fresh (they have to indicate one month before bond maturity); and
(4) will the required IPO forms be submitted to the exchange in time to lessen the sum payable to bondholders if the listing takes longer than expected to complete?
Confidence boosters
√ The entry of Garden Fresh beverages into Thailand in the second half of this year should point to the Thai investors being serious in working with Sino Grandness.
Their strategic alliance with Sino Grandness will entail more financial outlay aside from the subscription of placement shares. For example, the Thai investors will have to commit resources to import Garden Fresh juices into Thailand and undertake the distribution.
√ Sino Grandness has announced the incorporation of two companies, in Hong Kong and the Cayman Islands. Does that signify that preparatory work of IPO is at an advanced stage?
Garden Fresh has been operating as an independent entity with its own assets and board of directors as it was Sino Grandness' intention at the outset to list it.
A cumbersome restructuring to be conducted before IPO has therefore been obviated.
A successful listing of Garden Fresh will provide tremendous relief to investors. Garden Fresh will be spared the need to redeem the bonds for RMB 650m (or a lower RMB 580m if an application for listing is made).
Moreover, money raised from issuing new Garden Fresh shares will enable Garden Fresh to grow further.
And Sino Grandness may release some of the Garden Fresh shares it owns for sale as vendor shares during the IPO, and use the money collected to pay a special dividend to shareholders.
Comments
but the trend is away from drinking fruit juice to eat fruits.
This week, it looked as if fruit juice might finally lose its claim to healthiness and be put into the same category as fizzy drinks. It emerged that a headteacher, Elizabeth Chaplin, who runs Valence primary school in Dagenham, wrote to parents about a new rule to confiscate juice cartons from children's lunch boxes. Instead, pupils would only be allowed to drink water.
Days earlier, Susan Jebb, a government advisor and head of the diet and obesity research group at the Medical Research Council's Human Nutrition Research unit at Cambridge University, told the Sunday Times that the government's official advice that a glass counts towards your recommended minimum five-a-day servings of fruit and vegetables should be changed.
It appears that the Thais are not all talk but are working together to seal their ties. It is great to know that they are working on the distribution of Garden fresh juices to Thailand and to rest of SEA. Will they also work to bring in local Thai beverages to China as reported in the edge magazine? Will the Thais bring in Nestle to expand the distribution of Garden fresh juices globally?