China Minzhong Food Corporation

[Wildreamz]

China stocks come with accounting frauds and hidden debts. Although fundamentally food prices will rise due to the lack of farmers, i cannot trust China stocks due to a string of poor historical performances despite its good earnings.

With references from Dukang Distillers. Luckily managed to sell it at a higher price.

With the lack of consistent performances of China stocks, i am determined to stay away from them.

Food price will raise with inflation, cost of production will raise in the short run along with wages, but in the long run cost will go down once China automate everything like their western counterpart (ie the industrialized farming that Minzhong is trying so hard to push for). It is just a necessary and inevitable path that they will take. The question is only by whom and by when.

By performance, you mean stock price performance? Usually it has little to do with underlying fundamentals and more to do with market sentiments.

That said, I'm not sure you can say S-Chip definitely will never have good share price performance. Check out Sino-Grandness or even the recent Sound Global (although it cheated a little by listing on the HK exchange, but those who bought it back in Singapore has a good run for their money).

And now with Indofood owning 80+% of the shares, I don't think we should hold the same standard to it like ordinary S-Chip shares. For one thing, we know it can never be delisted on the cheap easily.

With Indofood as their major and controlling shareholder, I don't think legal accountability is an issue any more. The intrinsic value of China Minzhong has fundamentally changed when Indofood took over.