Key Investment Considerations 1)superb fit of very-strong macro economic trends in China Agriculture 2)well connected top management 3)strong,rapidly growing seed position 4)positioned to be the leader in ag biotech in China 5)positive cash flow should bol- ster already strong balance sheet 6)EPS should burgeon as revenues grow and fixed costs decline 7)SEED could repeat MON's suc- cess in China with huge lever- age possible(only 20 MM shares outstanding).
The balance sheet of Seed looks extremily weak. Way over leveraged. Current assets are 925 million RMB and current liabilities are 1055 million RMB. So the company has more short term debt then cash + cash equivalents.
I prefer to invest with regard to the numbers and not with regard to fairy tails. No doubt there are companies that play the chinese market better than seed. Perhaps Montosanto jumps in.
the market was flooded with small rogue seed companies. Then when the gov't decided to kick in regulations all the small companies dumped seed onto the market crushing the market by inflating the inventory. Also SEED was just coming out of the gate and in the process of developing product expanding capacity, restructuring the management team and implementing new off site sales model. Most of these rough times are in the rear view mirror in my opinion. Just a few of my thoughts.