Stock chasing

late last nite, Fuxing announced a placement of shares and sale of convertible notes to raise $7.7 m net. prior to the announcement, the stock saw high trading vol and a run-up. shares of several companies hv demonstrated the same pattern: sinotel, for example, was a recent one. good or bad? depends on case by case. depends on how the $ will be used. will it generate shareholder value?

The Group has posted strong financials for the three months ended 31 March 2010 with net earnings almost doubling to RMB 11 million on a 34% increase in revenue to RMB 108.1 million. To reward shareholders and attract long-term investors, the Group has decided to adopt a dividend policy of paying out at least 40% of each year’s net profit as dividend from FY2010. The Group has declared an interim dividend of RMB 0.02 per ordinary share. Payment date shall be announced at a later date.