Seeking Alpha
Editor's notes: Investors willing to look past Chinese conglomerate CRE's intentional short-term margin sacrifice will find a sizable long-term growth opportunity and attractive valuation. 40-50% upside.

Investors know all too well how challenging it can be to generate long-term gains from Chinese equities. Leaving aside those companies that play fast and loose with accounting or pin their hopes on favored relationships with government officials, there are the rapidly-changing economic trends that may make long-term forecasting even more challenging.

All of that said, I think investors should give serious consideration to China Resources Enterprise (OTCPK:CRHKY). While CRE carries the black mark against it of being a state-owned enterprise, the company has emerged as a leading retailer and brewer in this fast-growing economy, and is looking to invest more in its food processing and beverage businesses.

What's more, the company plays the long game -...

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