Found one Gem, KIV two

Alright as promised, the first stock to enter my portifolio will be "China Milk" bought XX lots at $0.705 , the reasons why i bought this stock is simple

1) The milk market in China is growing , demand for beef/dairy products/milk are all coming to new light. And as stated in the annual report, milk demands in China are soo huge that the company cannot fullfill the orders of 2007.

2) High ROE , very important factor when investing, the company consistantly reaches above or if not more than 15% since 2005

3) Good cash flow and high cash reserves , ensures that the company wouldnt go into liquidty problems

4) Low PE vaule of 8-9 times, reasonable PVB of 1.8

5) Closing year book profits of 23% increase. However deal to derivatives infusion, factoring that out we have an 8% increase in Net profit.

6)More growth to be factored into this stock, like production of own milk products, increase in herd size , more RnD.

Target price for China Milk (at least $1.25, now trading at $0.735 as @ 6/6/08)

KIV stocks

Coscop and Synear

Coscop : China's biggest shipping repair company, more like a blue chip, moderate growth potential , high economic moat.

Reasons why i have not yet buy

1) At a price of $3.40+ doesnt reflect its instrinsic value of $2.80+ which i caculated.

(Using 10 years discounting EPS growth of 10% , EPS of $0.21, cap interest rate at 3%)

2) Beacuse Balstic Dry index has reached new highs this year and the last, the latter suggests a correction is near or immeiant.

3) High PVB, High PE ratio, which means if i were to invest in this stock , i will be investing based on their expected growth and not seeking value

Synear: Undervauled stock, good net profit per quarter, dropped below its IPO price ,low PE and PVB, high ROE

This despite all the good ratios , showing in this stock. The reasons why i havent buy into this company is because

1) Share price keeps dropping, TA doesnt state or suggest any rebound yet

2) The company issued a HUGE amount of shares just like Cosco (2000,000,000 shares) , obviously its EPS is low if not very very low.

3)Soo many uncertains lie ahead for Synear, is the company expanding too fast? How are they coping with HIGH OIL prices, high labor costs, government restictions on certain products?

4)Whats next for the forzen industry ? High competition very likely.

Soo yeah, thats my above take and im glad that i found a market gem after a few months of analysing/searching. Investing is definately not easy , you have to take in this, consider that , forcast this, factor that out..zz tiring..but EXCITING. Whats next will be me searching for stocks that will ride the Olympic bull in China 2008 , not that im being baised or what, i think China S-shares are really undervalued and good to look at, however with that note taken, China market and businesses might be facing problems or more problems even after the Olympics, but rest assured i only recommend shares that are strong in business concept, demand for thier products/services/ strong ecnomic moat/ moderate -high grow/Low PBV and PE/ high ROE.

Alright~ Rex out

Happy investing.