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During the IPO season Francis Gaskins, editor of IPOdesktop.com, regularly appears on CNBC TV, Bloomberg, thestreet.com & other financial cable channels. On the day of the Visa IPO he appeared on four cable TV financial shows including Bloomberg & CNBC. Over the past five years he has... More
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  • Lizhan (LZEN) IPO -- low P/E multiple, will sales growth continue? 2 comments
    Nov 13, 2010 2:22 AM | about stocks: LZEN
    Nov 15wk IPO calendar

    Lizhan Environmental (LZEN) $10mm IPO
    with a market cap of $72 at the price range mid-point of $5.50

    LZEN Valuation Metrics

    CONCLUSION
    . Worth watching to see if the profitable, geometric sales increases can reoccur
    . Been in operation since 2008
    . For the nine months ended September 30, 2010 sales grew to 218% to $35mm from $16mm in the year earlier period
    . Gross profit of 25% suggests relatively low proprietary value added

    BUSINESS
    . Makes synthetic leather and other fabrics from recycled leather waste
    . Sells products to furniture, automotive upholstery and garment manufacturers, as well as fabric distributors.
    24% of revenues from export sales

    COMPETITION
    The synthetic fabric industry in China is very large and fragmented.

    INTELLECTUAL PROPERTY
    Five design patents and three new utility model patents

    USE OF PROCEEDS
    $8.5mm
    Installation of three production lines (production lines 2, 3 and 4) in the Evergreen Product facility that LZEN is in the process of completing.

    LZEN Valuation Metrics

    Stocks: LZEN
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  •  
    IPO price was at $4 finally.
    According to company's presentation in their website, company founded in 2005.
    I believe that with their new production lines they can achieve strong growth in 2011 also. As they said, they have contracts for the 90% of their 2011 production.
    18 Jan 2011, 12:33 PM Reply Like
  •  
    -Chery auto OEM recently entered into LOI for product and market co-development with LZEN, for its new recycled&patented product, "Evergreen LZ".

    -Chery started the production of a new electric car, called "Ruilin M1", in November. Their policy is to use recycled "green" material for their "green" car.
    (Also, Chery expects 32% y-o-y increase in their sales).

    -LZEN will complete the first two production lines for "Evergreen LZ" by February 2011 and two more by April 2012.
    This new product has higher profit margins than the existent synthetic leather which LZEN produces.
    28 Jan 2011, 04:54 AM Reply Like
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