Chinese Equities and Corporate Governance Issues

Transcription

1 Chinese Equities and Corporate Governance Issues Nanjing Hong Kong Taipei December 2011 Page 1

2 DISCLAIMER The information contained in this document has been compiled from, or has been based upon, publications, reports and other sources believed by the author to be accurate, sufficient and reliable. While reasonable efforts have been made to ensure the accuracy, sufficiency and reliability of such information, no representation and assurance can be given that all such information is accurate and complete in all material respects and not misleading and all sources of information are reliable. The delivery of this document shall not in any event create any implication or constitute a representation or warranty that the information contained in this document is true and correct and not misleading as at any time subsequent to the date of this document. No disclosure of any such information shall be made by the recipient to any other persons in any circumstances except as otherwise compelled by applicable laws. This document does not constitute, and may not be used for the purposes of, an offer or solicitation to anyone in any jurisdiction in which such offer or solicitation is not authorized, or to any person to whom it is unlawful to make such offer or solicitation. The distribution of this document in certain jurisdictions may be restricted and, accordingly, persons into whose possession this document comes are required to inform themselves about, and to observe, such restrictions. If you have any doubt about the contents of this document, you should consult, and obtain independent advice from, your legal, financial and/or other professional advisors. Page 2

3 Our Edge Core Network of 7 Partners / Senior Members with 140 Years Investment and Finance-related Experience in Greater China ALL Fluent in Mandarin Chinese First Hand Experience in ALL Chinese Equity Market Cycles Excellent 10+ Year Long Side Investment Track Record Operations are Based Locally Hong Kong and Nanjing Registered Investment Advisor in HK and US Page 3

4 Investment Products (Pacific Sun) The China Mantou Fund Long/short fund investing in greater Chinese equities Focus on small and mid-cap companies 8 year track record Suitable for investors that require long/short strategy Current directors include Dr. Marc Faber, David Hui, David Lee, Andy Mantel, and Chris McDonald Pacific Sun Greater China Equities Fund Long only fund investing in greater China equities Focus on small and mid-cap companies Attractive 10+ year long investment track record Suitable for investors with 5-10 year investment horizon Target size of US$200mn after 3 years Directors include Mark Fischer, Liu Xuezhong, Andy Mantel, and Carl Wegner Launched November 1, 2011 Pacific Sun Zhongtai Private Equity Fund Private equity/pre-ipo fund Focus on companies from attractive industries that will go IPO within 2-3 years of Fund s investment Target investment capital of US$25mn from Pacific Sun/Zhongtai Target size of US$200mn 1H 2012 launch date Page 4

5 Andy Mantel First and Recent Trip to Shanghai Shanghai Pudong Skyline - August 1992 Shanghai Pudong Skyline September 2010 Page 5

6 Liu Xuezhong Meeting Government Officials With Donald Tsang, Hong Kong s Chief Executive With ZHU Shanlu, Nanjing s Secretary Municipal Committee of the CPC Page 6

7 Liu Xuezhong Meeting Investors With Andy Mantel and other international investors at World Capital Forum, hosted by Zhongtai Group in Nanjing in 2002 With Steve Forbes Page 7

8 Senior Advisors Dr. Marc Faber - Ph.D., Economics, University of Zurich - World-renowned global investor and commentator - Founder & Editor of The Gloom, Boom & Doom Report - Chef Martin Yan - M.S., Food Science, University of California-Davis - Certified Master Chef, a highly respected food consultant, a cooking instructor and a prolific author - Host of over 3,000 cooking shows - Page 8

9 Greater China - The Opportunity Major Themes Urbanization Roll Out to Support High Economic Growth Domestic Consumption to Spur Economy Internationalization of Renminbi Stronger Renminbi / Hong Kong Dollar / Asian Currencies Investment Choices to Expand Dramatically Equity Valuations Extremely Low Page 9

10 Greater China - The Opportunity Domestic Consumption to Spur Economy % of Global Consumption (E) 2010 (E) 2015 (E) 2020 (E) US Japan Germany China UK France China s domestic consumption is expected to make up 16.4% of total global consumption by 2015 and grow to 21.1% of total global consumption by 2020 (Source: IMF) Page 10

11 Greater China - The Opportunity Investment Choices to Expand Dramatically October 2011 October 2014 Hong Kong Main Board 1,359 1,752 including H shares and Red Chips Hong Kong Growth Enterprise Market Shanghai A-Share 905 1,230 Shanghai B-Share Shenzhen A-Share 1,338 1,760 Shenzhen B-Share Taiwan Main Board Taiwan Gre Tai Exchange Singapore Other Asia US & Canada London Other Europe Total 6,317 8,300 * Pacific Sun estimates Page 11

12 Greater China - The Opportunity General Risk Factors Geopolitical Events/Relations Excess Liquidity and Inflation Fraud and Corruption Nationalism Social Unrest Not Investing in Greater China * * Greater China is increasingly an independent asset class in itself Page 12

13 Pacific Sun Greater China Equities Fund Stock Screening Model Sub-sector Sample Stock Screening Model COMPANY TICKER CHINESE NAME Mkt Cap (USD mn) SHARE PRICE PE RATIO PRICE-BOOK RATIO PRICE-SALES RATIO EBITDA/ SHARE EV/EBITDA PRETAX MARGIN ROE DEBT TO EQUITY DIVIDEND YIELD Daily turnover (USD mn) CONSUMER STAPLES - FOOD PRODUCTS Beijing Sanyuan Foods Co Ltd CH 三元股份 Bright Dairy & Food Co Ltd CH 光明乳業 Century Sunshine Group Holdings Ltd 8276 HK 世紀陽光 Chaoda Modern Agriculture Holdings Ltd 682 HK 超大現代農業 China Foods Ltd 506 HK 中國糧油國際 China Green Holdings Ltd/Bermuda 904 HK 綠色食品 China Starch Holdings Ltd 3838 hk 中國澱粉 China Yurun Food Group Ltd 1068 HK 雨潤食品 COFCO Tunhe Co Ltd CH 新疆屯河 CP Pokphand Co 43 HK 卜蜂國際 Danhua Chemical Technology Co Ltd CH 大盈股份 First Natural Foods Holdings Ltd 1076 HK 第一天然食品 Four Seas Mercantile Hldg 374 HK 四洲集團 Global Bio Chem Technology Group Co Ltd 809 HK 大成生化 Global Sweeteners Holdings Ltd 3889 hk 大成糖業 Golden Resources Development International Ltd 677 HK 金源米業 Haikou Agriculture & Industry Co CH 羅牛山 Henan Lianhua Gourmet Powder Co CH 蓮花味精 Henan Shuanghui Investment & Development Co Lt CH 雙匯發展 Heng Tai Consumables Group Ltd 197 HK 亨泰消費品 Inner Mongolia Pingzhuang Energy Co Ltd CH 草原興發 Inner Mongolia Yili Industrial CH 伊利股份 Pacific Andes International Holdings Ltd 1174 HK 太平洋恩利 People's Food Holdings Ltd PFH SP 大眾食品 Shandong Denghai Seeds Co Ltd CH G 登海 Shandong Zhonglu Oceanic Fisheries Co Ltd CH 中魯 Shanghai Dajiang Group CH 大江 Shanghai Dajiang Group CH 大江 Sichuan New Hope Agribusiness Co Ltd CH 新希望 Tingyi Cayman Islands Holding Corp 322 HK 康師傅控股 Uni President Enterprises Corp 1216 TT 統一企業 United Food Holdings Ltd UFH SP 聯合食品控股 V V Food & Beverage Co Ltd CH 維維股份 Vedan International Holdings Ltd 2317 HK 味丹國際 Want Want China Holdings Ltd 151 HK 旺旺集團 Xinjiang Hops Co Ltd CH 啤酒花 Xiwang Sugar Holdings Co Ltd 2088 HK 西王糖業 Yantai North Andre Juice Co 8259 HK 安德利果汁 Page 13

14 Pacific Sun Greater China Equities Fund Fund Details Offering Period : 4Q 2011 Min. Investment : US$100,000 Management Fee : 1.75% per annum Performance Fee : Class A 0%; Class B 8.88% high on high Dealing : Monthly Lock-up Period : 6 months Redemption feature : 10% monthly limit Financial Year-end : 31 December Custodian : DBS Bank Ltd, Hong Kong Branch Administrator : Apex Fund Services Auditor : Deloitte & Touche Legal Advisor : Bingham Page 14

15 Contact Information Investment Manager : Unit 605, Bank of America Tower 12 Harcourt Road Central, Hong Kong Founder & CEO : Andy Mantel (andymantel@pacificsun.com.hk) Investor Relations : Candy Tse (candytse@pacificsun.com.hk) info@pacificsun.com.hk Telephone : Facsimile : Website : Page 15