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Lizhan (LZEN) IPO -- low P/E multiple, will sales growth continue?

|Includes: Lizhan Environmental Corporation (LZEN)
Nov 15wk IPO calendar

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

LZEN Valuation Metrics

. 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

. 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

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

Five design patents and three new utility model patents

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