Dukang

Target price?

1 year ago in April 2012, Dukang was 32 cents. Today, it's .... 32 cents. In between these dates, it went as low as 22 cents and as high as only 34 cents. What is the catalyst to enable it to break above 34 cents?

Looking at how hot REITs these days, it seems that most investors are hungry for cash return, so imho one of the possible catalyst is if Dukang indeed proceeds to distribute dividend as considered

www.nextinsight.net/index.php/story-arch...urge-525-to-rmb-144m

considered for dividend: 200 million rmb
number of shares: 798,289,318
est dividend per share: 0.25 rmb => 0.05 sgd
est dividend yield (using dukang current share price 0.32 sgd) : 15%

we shall see...

Roger, i think that any dkvidend they will gjve will not be very much. S chips dxcept for Yangzijiang tend to want big cashpile for biz expansion.

Dukang is v undervalued. Reminds me of Sino Grandness in 2012. Are you thinking that Dukang can also fly one day , in 2013?

Hi Garl,

The dividend number that I quoted (200 million rmb) was taken from the NextInsight article. It was the Dukang's CEO (now also chairman) who mentioned the number.

However, i agree that we can not be too sure if they will distribute the amount.

While as one of the shareholder it would be nice if Dukang stock go much higher, i do not know whether Dukang will fly in 2013

Normally spirits/alcoholic drinks producer trades at higher PE (>15) but currently Dukang is different because:
a) it is an s-chips
b) Baijiu market is still highly fragmented. Dukang holds much less than 10% market share in its turf (Henan province)
c) currently Dukang is not considered among the top 10 baijiu brand in China

Roger, the NextInsight article cited the CEO saying RMB200 m could be set aside for divdends. Do you think it's probable? This is a very big amount : 200 m divided by 800 m shares = 25 rmb cents = 5 SGD cents a share. For a company that hasn't paid out dividends, it would stretch my imagination to expect Dukang to pay out 5 SGD cents a share which is equiv to 14% yield on the stock price of 33 cents. www.nextinsight.net/media/kunena/emoticons/cheerful.png