Five China Stocks I'm Eying This Week

1) China Yingxia (CYXI.OB) has established operations in India, citing great potential for its nutriceutical and organic food products. But CYXI is a small company operating out of Harbin in northern China. Is this a case of trying to run before one has learned to walk, or is CYXI cleverly leap-frogging over its much larger competitors?

2) Xinyinhai Technology [XNYH.OB] has acquired facilities to expand its financial printing production by a whopping 50%. This acquisition came with land that is three times the size of XNYH's current location, allowing for easy future expansion. With financial printing growing at 40% per year, and with the company's prestigious slate of customers including Bank of China, China Construction Bank and Agricultural Bank of China, isn't it time the investor community take notice of this gem of a company?

3) China Solar (CSOL.OB) announced this week that it has acquired Shenzhen PengSangPu, a manufacturer of flat plate solar heaters and installer of hot water systems for business users. This move, the first significant transaction since its name change and new CFO coming on board, not only provides a footprint in southern China but is also clear evidence of CSOL's need to expand, given its more-than-full utilization of current production capacity. Is this a sign of things to come?

4) Kiwa Bio-Tech (KWBT.OB) was up more than 40% this week when most stocks were slumping. Was that because of the series of meetings the company had in Beijing, the first, to reward and provide future incentives for its employees and sales force, and the second, a symposium to form better ties with local and provincial distribution networks? Or is there some upcoming news on the company's exciting anti-bird flu spray product?

5) China Clean Energy (CCGY.OB) has done the right thing in appointing Gary Zhao, its CFO, to its board of directors. Having worked at Accenture, CapGemini and Sohu, is there anyone better to serve as liaison between the management and the company's new investors as a result of the $15 million PIPE, a transaction he helped to engineer?

My Position: None.

Comments

[omooc:]

Are there reasons why solar stocks are mostly domiciled in China?

2008 Jan 21 10:44 PM

[J.D:]

Simple solar devices are commonly used in the countryside so there's a high demand for cheap product. Think rooftop solar water heaters and streetlights for areas without reliable electricity, not high tech innovation. On Chinese companies overall think "due diligence" and "get rich quick scheme". On Chinese markets, think "pyramid". Somewhere in the mess a few will find nuggets of gold.

China markets are being routed today, though China remains particularly vulnerable to further downside. "Decoupling" is the worst possible theory in a time of rapid globalization.

2008 Jan 22 05:07 AM