| Get On Yer Bike...

9th Nov '08 by Murakami

5 comments 1548 reads

Ok, I am starting a thread on China Shoto to see people think of it. I am still doing research on it, but what I know so far is:

Priced at 130p on flotation on Aim at the end of 2005
The company is China’s largest producer of back-up lead acid batteries, and makes the back-up batteries used to power transmitters for China’s booming mobile telecommunications market, as well as rechargeable battery packs for electric bicycles.
Its customers include all three of China’s mobile telephone operators - China Telecom, China Unicom and China Mobile.
Increased sales for the six months to June 30 from £38m to £68.6m which is not too shabby - to diversify, it started supplying batteries to bicycle makers in 2006 and rising demand for electric bicycles was an important contributor to the sales growth.
Interim dividend was suspended a year ago because of rising lead prices but recently restored.

It's currently trading well below its flotation price...

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Murakami

9th Nov '08

Electric bicycles??? Apparently, 18m electric bicycles are being produced in China each year!

Admission prospectus is here: http://www.chinashoto.com/shuangdeng/pic/Admission%20Document%20(Prospectus).pdf

LeighBarton

10th Nov '08

Murakami, I was in CHNS but came out recently primarily because of cash demands elsewhere. The main interest points for me in CHNS were the electric batteries for bikes and renewable energy, ironically it was neither of these areas that actually has supported recent growth but their third division supply of back up batteries to telecommunications industry that has seen growth in both China and more importantly India. This success has resulted in the company switching resource to support this growth. This may be a shrewd short term measure but does raise questions about the strength of the other divisions where they are prepared to trim back on growth (a new factory was built, funded by investors, to support growth in the bicycle division, it is this new capacity that I understand got diverted to fulfilling telecommunication demand), and makes me nervous that they are a bit of a one trick pony, even if that pony has got excellent prospects in the short to medium term.

That stated this is a company with prospects and although perhaps not as exciting as I had thought when I first invested here it would have been one I would have been happy to leave my money had I not had calls on it elsewhere.

promethean

16th Dec '08

China Shoto released an trading update on the 10th...

China Shoto is pleased to announce that the strong progress previously reported for the six months ended 30 June 2008 has continued into the second half of the financial year. As a result of the continued strengthening of both domestic and international sales, the Board is confident that the results for the current year will be ahead of market expectations.

In the domestic telecoms sector, demand for the company's back-up batteries remains a key driver of the business. China Shoto has cemented its position as a market leader by remaining the largest back- up battery supplier to China Mobile, and has also successfully increased its sales to a number of other leading domestic operators.

Over the financial year China Shoto has also continued to expand into overseas markets, most notably and successfully in India where contracts with a value of US$54.92 million had been signed by the end of September 2008. While domestic sales continued to increase during the nine months ended 30 September 2008, international sales rose faster, accounting for approximately 15% of the Company's total revenues for the period, up from 6% during the 2007 financial year.

The Company has benefitted to some extent from the financial stimuli given to the Chinese economy by the Government in response to the global financial crisis. Following substantial interest rate cuts, and with falling prices of raw materials, the Company aims to take advantage of the easing of financial conditions whilst continuing vigorously to pursue its business opportunities despite competitive product price pressures.

14th Feb '09

It just gets better and better. In a further trading update, China Shoto pointed to a "sound order book" and said it was also anticipating a "satisfactory result" for 2009. Net profits for 2008 will rise more than 50% above the £5.89 million achieved during 2007. The 2008 final results announcement is anticipated for late April or May.

http://www.stockopedia.com/news/announcement/CHNS/090212chns5113327.htm

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Murakami

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