most of my chinese stocks have nicely rising sales but even faster rising costs, thus having flat or negative EPS growth YoY. also some preferential 12% corp. PRC tax rates have been expired in 2011-2012. most companies will have a flat 25% rate. again cutting into EPS growth BORN has some pricing power, so EPS still grew. tax rate at 25% already. depressed gross margin hurt. I bet that's why it got downgraded.