 Emergence as fashion brand management platform since 2011

 Manage brands Angevil, Lamborghini, Gay Giano, Cour Carre and Due G

 Expecting to turn around in 2012 on strong retail and swimwear arm

 Further organic growth and M&A growth in HK luxury retail market

 Currently trading at 0.9x pre-derivative P/B 1H FY12/11A

 Sino Gas and Energy, is an ASX listed company, operating Coalbed Methane (CBM) projects in Shanxi China. CBM is a new form of clean energy highly supported by the central government.

 Series of favourable policies are announced to support and accelerate development of CBM segment. For example, VAT rebate, subsidies and construction of large scale pipelines.

 Distinct geological advantage: combination of shallow and deep CBM reservoirs. High gas rates from deep CBM project, with potential to speed up gas production via shallow CBM projects.

 Moving toward production stage. Number of wells will be more than triple as compared to FY2011.

 On January 16th, 2012, the group announced profit warning for the year ended 31 December 2011. The decrease is attributed to increasing in cost pressures in the PRC, disappointing sales from the new retail business: 7 Magic. The new laundry business and everyBody Labo brand continues to record losses.

 We believe that sales for the hotel and airline business should continue to have strong growth, but profit will be hurt from higher operating costs. Gross margin at the end of 1H FY06/11A is around 24%, down from 27% at the end of FY2010A. We estimate that there’s a chance for full year gross margin to be around twenty percent.

 We estimate that 7 Magic should have approximately 1,700 shops by the end of FY12/11F. 2H FY12/11F performance was disappointing due to economic slowdown and increased in operating cost, thus may fall short of the management previous expectation.

 We revised our revenue for FY12/11F to be HK$1,376.8m from HK$1,429.4m, a 27% YoY increase. With HK$1,169.6m contribution from the hotel and airlines amenities business and HK$198.4m contribution from the retail business. We forecast net profit to be HK$78.0m for FY12/11F, representing a

29% YoY decrease.

 We maintain our coverage with a Hold recommendation at a target price of HK$1.30. Our target price represents 8.5x FY12/12F P/E and 6.3x FY12/13F P/E.

- The analytical and laboratory instruments market in China is expected to become a US$3.5b market by 2014 (09-14 CAGR 8.3%)

- The market may potentially grow at a greater pace given China's increasing focus on food health and safety quality, improvements in the manufacturing

quality control and environmental regulations

- Techcomp is a leading company in this segment since establishing in 1991. It has been growing at a 20% CAGR from 2002 and 2010 and is now exploring

ways to accelerate this growth going forward

- Company already has a footprint in the European market and is looking at opportunities for further strategic acquisitions in the US (to establish footprint)

or Europe (to strengthen presence)

- 3rd largest producer with 20% production market share in China in a concentrated space (top 3 producers account for 85% of production). Sanjiang is the largest private enterprise producing EO in China.

- Entry barriers are extremely high. New entrants need to have minimum production capacity of 200,000MT, requiring significant upfront investment. 

- All EO produced in China are sold in advance. There is a demand/supply gap of around 30%. This supply gap is presently met by importing of downstream surfactant products, which is cost ineffective.

- Continuing growth in demand expected. According to management, China currently produces around 300 products which uses downstream surfactants. In contrast, the US/Europe produces around 3,000 applications.

- Stock is depressed due to market conditions and exit of pre-IPO investors post listing.

-  Tianjin TEDA engages in the development and sales of biological compound fertilizer products, medical and health products.

-  Last reported earnings was for nine month ended FY09/11A. Revenue increased 29.9% YoY to RMB425.0m. Gross profit increased 39.9% YoY to RMB78.6m. Profit for the period increased 3.8x YoY to RMB11.7m. Gross profit margin increased 1.3pcp YoY to 18.5%. Net profit margin increased 0.8pcp

YoY to 1.8%. 

-  The sales of fertilizer products amounted to RMB347.8m accounted for 81.8% of total sales, a decrease from 82.2%. The health products business amounted to RMB77.2m accounted for 18.2 % of the sales, an increased from 17.8%. -  On June 17th 2011, the group announced that they have entered into an acquisition agreement to acquire the 25% equity interest in Tianjin Alpha Healthcare Product for a cash consideration of RMB4.6m (~HK$5.54m).

-  The counter is currently trading at 71.1x current year fwd P/E on consensus. The Hong Kong listed fertilizer producers are currently trading at average 19.5x FY12/11F P/E and 13.7x FY12/12F P/E based on market consensus.

- Leoch is a vertically integrated lead acid battery producer in China

- Leoch is in the progress of facilities upgrades to better manage lead emissions

- Generally environmental compliant to benefit from consolidation esp. in 2012

- Current expansion plan gradually rolling out between 2011 and 2013

- China producers are gradually replacing suppliers from developed markets

- Broad range of lead acid battery products minimizing sector volatility

- Attractive valuation at 6.9x 2011F P/E on our estimates. Initiate BUY rating

buyback of 8.5% issued share capital of All Team. All Team is a wholly owned

subsidiaries of the Group.

- Spent almost 4 years on business restructuring to complete repositioning

- Strong background to capture growth in media & entertainment opportunities

- Major contribution from digital TV business in Hunan in 2012

- Advertising outdoor billboards in core area such as Xindan and Wangfujing

- Entering into highway billboard, press and entertainment businesses

- Unique one-stop media solution business model at 0.7x P/B 1H FY12/11A

-  Q4 orders not as strong as previously expected

-  Further slight margin squeeze in 2H 2011 on weak market demand

-  Downward revision of numbers for 2011

-  HL Tech remains fundamentally strong and positions for recovery in 2012

-  Expect to receive more additional orders from new tenders and new clients

-  Remove reference target price due to removal of this rating class