Member Info for Proselenes

A bit off topic, but if you want an even cheaper Chinese stock with a strong outlook, try West China Cement. ( WCC ) With over 1 pounds of earnings forecast for next year, its on a forward PER of just times 1.5 at present.

This one is on a current year PER of just over times 2, and a forward PER of under times 2. Makes it very cheap. I had a change of stance on this one and have been buying in since 120p levels, and see the potential here to do a "SOLA" given over 1 pounds of earnings forecasts for next year. Broker forecasts : Evolution Watter... 31-03-09 BUY 2009 PTP 56.62m 2009 EPS 78.63p 2010 PTP 75.94m 2010 EPS 104.57p

http://www.investorschronicle.co.uk/ Spectacular results from China Shoto Created: 29 April 2009 Written by: Nigel Bolitho While the UK seems to have little money to spend on infrastructure schemes to pull the economy out of recession, China is pumping RMB4trillion of its mega cash reserves into infrastructure schemes. And of that, RMB400billion is earmarked for 3G networks over the ...............................................For 2009, broker Seymour Pierce's revised forecast is sales of £200m and profits of £12.5m, producing earnings of 47p. SHARE TIP UPDATE Buy - That puts the shares on a PE of under four coupled with net cash equivalent to more than half the company's market value. China seems to be coming out of recession fast. A year ago we upgraded the shares to a buy at 145.5p, and they remain so.

Comment from GCI. Snippet below, click the link for the full article. http://www.growthcompany.co.uk/recommendations/1020952/china-shoto.thtml China Shoto - BUY Companies: CHNS 28/04/2009 Despite substantial growth, robust prospects and a........................ .....................Based on forecasts for 2009 from house broker Seymour Pierce – of £12.5m PBT and 47p EPS – its shares are trading on a prospective price-to-earnings ratio of just 3.7 times, which seems far too low. Buy.

This comment from Investors Champion : http://www.investorschampion.com/blog/entry/china-shoto-amazing-turnaround-in-cash-fortunes . On another note the earnings forecast for 2009 has been upgraded to 47p (from 43p), which puts CHNS on a PER of less than times 4 and with NTAV of over 50M GBP ( for a market cap of presently circa 41m GBP), and of course, its paying a cash dividend.

Comment from Richard Gill over at "sharecrazy". Confirms what I have been posting about, which is the massive spend ahead by China Telecom, and the other major customers of CHNS, which will result in "huge" potential orders. I notice in the results today "huge" is quoted to the potential ahead. "Richard Gill Re: China Shoto - Backup batteries and more [Re: Proselenes] #444647 - 28/04/09 01:11 PM Very good results. Just been to a presentation by the management. Key point for me was that cash flow has improved significantly and that major customer China Telecom has recently almost trebbled its capex spend for 2009-11 in wake of the move to 3G"

And the results are quite good indeed. http://www.investegate.co.uk/Article.aspx?id=200904280700142508R ........ Highlights Revenue increased by 70% to £183.08 million (2007: £107.50 million) Net profit up 79% to £10.07 million (excluding minority interests) (2007: £5.62 million) Net cash flows from operating activities were greatly improved to £38.57 million (2007: outflow £3.11 million) Foreign sales revenue up 329% to £29.71 million (2007: £6.92 million) Diluted earnings per share up 76% to 43.14p (2007: 24.45p) Awarded 'China Environment Friendly Enterprise', the highest State Environmental Protection honour An interim dividend of 1.5 pence per share paid; the Board recommends a final dividend for 2008 of 3.5 pence per share

Put this summary post on TMF. http://boards.fool.co.uk/Message.asp?mid=11528229 .

To focus the mind on the staggering demand for Battery Back Up systems just for Mobile Base Stations (ignoring all the other, and not insignificant stuff than CHNS do). The demand between now and 2012 is just massive........ Some snippets below - http://www.tdscdma-forum.org/en/weekly/49/ China Mobile to Construct 140,000 TD-SCDMA Base Stations in 3 Years Sina Tech On April 7, Huang Yuhong, Head of Wireless Technology Research Group from the Research Institution of China Mobile revealed that TD-SCDMA can cover 70% of the Chinese cities by end of 2009. China Mobile plans to raise this ratio to 100% with more than 160,000 base stations in all cities by 2011. In the 1st round of TD-SCDMA network construction, China Mobile built more than 10,000 base stations. Since the 2nd round construction of TD-SCDMA network, China Mobile has intended to deploy about 140,000 base stations from 2009 to 2011. ................. ----------------- http://news.xinhuanet.com/english/2009-04/17/content_11196469.htm Chinese Vice Premier looks to domestic standard for 3G development www.chinaview.cn 2009-04-17 05:22:58 ...................By the end of this year, China Mobile is to invest 58.8 billion yuan (8.6 billion U.S. dollars) in building 60,000 new TD-SCDMA base stations covering 238, or 70 percent of, prefecture-level cities, according to the Ministry of Industry and Information Technology.

The results from JHL will focus people on Chinese companies that are manufacturing (not software or other rubbish) and the next one due is CHNS. However, CHNS should have a much stronger outlook than JHL managed, so the effect of good results, a div and also a strong outlook should excite the share price.

Up again and the 200p level gets closer. If results are as good as is suspected and also there is a cash dividend of 5p then surely this must, in the months ahead, move up to and over the 300p level ?

Up a good 4% on a market down day, cannot ask for more. Danny, the only "negative" would be the debt level, however, with interest rates low and gearing at a very reasonable level, its not a major worry.

Seymour Pierce notes last week : [b][i]"China Shoto 3,5 (BUY) - Results preview CHNS.L (142.5p) Market cap: £33m China Shoto reports its FY 2008 earnings on 28 April. We expect the company to report PBT of £10.5m on revenue of £170m. This represents an uplift of 50% and 58% respectively. The company is a major beneficiary of cellular telecoms infrastructure spend. We believe the market will concentrate on the outlook for 2009 and 2010 in the context of the growth estimates for China and India. We note that Chinese first quarter GDP data is due out today. Growth of 6-7% is expected. While this is down on our December 2008 estimate of 8%, an above positive 5% number is exceptional relative to other global economies. Against this background we think China Shoto is well-positioned. China Shoto has a modest export exposure (less than 10% of sales) to India. We expect the company will update the market on trading in that territory on 28 April. Shares in China Shoto have risen by 39% so far this year. Coincidentally, the Shanghai Composite index has risen by the same amount. On our December 2008 forecasts, the shares are trading at a PE multiple of just 3.5. We expect forthcoming results to prompt a re-rating."[/b][/i]

The Seymour buy note will have generated some interest, however there is more on the bones if look. Firstly, CHNS is on a low PER, trading now at sub 4 times soon to be historic EPS. That on its own means little in the current climate as many stocks are on low PER's however ; Secondly, CHNS should be paying a cash dividend of circa 5p, and in these times when banks are giving nothing on savings accounts, a nice little yield on a stock makes a different. Once again, a few low PER and dividend paying stocks about, however, the key here is that CHNS has a strong outlook, or so we hope. The on going "domestic stimulus" in China is designed to boost domestic demand, and help the domestic situation. Its not about "saving the world' its about saving China. This is were CHNS benefits as the telecom companies have put in place major expansion plans for 2009/10/11 and onwards. This boosts the backup battery telecoms side for CHNS, and allows further growth for the next visible few years, ignoring their other electric bicycle, green energy and other sides of the business. So you get a low PER, a cash dividend and strong growth outlook, and that is what makes CHNS special IMO, a good investment perhaps. Time will tell. Results due 28th April.

Results 28th April. From uk-analyst.com today :- "Seymour Pierce issued a 'buy' note on China Shoto (CHNS), the batteries company, ahead of its full year results due to be released on 28th April 2009. The broker expects the company to report pre-tax profit of 10.5 million pounds on revenues of 170 million pounds representing a rise in each of 50% and 58% respectively. The company is a major beneficiary of the cellular infrastructure spend. The broker added: "We believe the market will concentrate on the outlook for 2009 and 2010 in the context of the growth estimates for China and India. We note that Chinese first quarter GDP data is due out today. Growth of 6-7% is expected. While this is down on our December 2008 estimate of 8%, an above positive 5% number is exceptional relative to other global economies. Against this background we think China Shoto is well-positioned. China Shoto has a modest export exposure (less than 10% of sales) to India. We expect the company will update the market on trading in that territory on 28 April.

I think the key to start a rerating to a proper valuation will be the dividend news. If we get something like a 3p to 5p cash dividend, then it will focus people minds on the growth, the EPS and the outlook

Notice that Gledhill recently increased their stake even further, taking out a seller who had started to crash the price a bit as they sold. Cannot be too far in the future when a takeover will play out surely. http://www.investegate.co.uk/Article.aspx?id=20090409150511P41C4

Nicely up today again. With what should be well over 40 pence of earnings and a very positive outlook this should and could soon be well north of 250p levels. Its a steal at under 10 times earnings....and that is over 400p.

Could be....due for release this month.

Building nicely, price is now up from 113p mid a few weeks back to now over 130p mid, and its still ridiculously cheap IMO :)