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(12-02-2014, 04:52 AM)Wildreamz Wrote: 1. The transaction between Gao Feng and Wang Peng/Dong Wu was completed on 7th Dec 2013. Hence, the earliest date that Dukang can be bought over from the public, without initiating a GO at $0.474 is 7th Dec 2014 (10 months from now).
First, thanks for sharing. Highly appreciated! =)
Secondly, I was wondering what GO means?
Thirdly, Im trying to understand the semantics of this, since english is not my mother tongue. Does this mean that Feng/Peng/Wu can buy Dukang from the public before the 7th December, if and only if they initiate a GO at $0.474. And after the 7th December, they can initiate a GO at any price? Is this correctly understood?
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12-02-2014, 09:27 AM
(This post was last modified: 12-02-2014, 09:30 AM by Wildreamz.)
(12-02-2014, 08:02 AM)drzoidberg Wrote: (12-02-2014, 04:52 AM)Wildreamz Wrote: 1. The transaction between Gao Feng and Wang Peng/Dong Wu was completed on 7th Dec 2013. Hence, the earliest date that Dukang can be bought over from the public, without initiating a GO at $0.474 is 7th Dec 2014 (10 months from now).
First, thanks for sharing. Highly appreciated! =)
Secondly, I was wondering what GO means?
Thirdly, Im trying to understand the semantics of this, since english is not my mother tongue. Does this mean that Feng/Peng/Wu can buy Dukang from the public before the 7th December, if and only if they initiate a GO at $0.474. And after the 7th December, they can initiate a GO at any price? Is this correctly understood?
You are welcomed.
2 good resources:
1. http://www.cnplaw.com/en/files/articles/...220610.pdf
2. http://www.mas.gov.sg/~/media/resource/s...nnex_2.pdf
GO means General Offer. Based on SGX rules shareholders initiate a GO when they have acquired 30% or more of the total shares, they have to make the offer at the highest price they used to acquired the shares, 6 months prior to the GO (I realize I made an error, the earliest date should be 7th June 2014, 4 months from now).
Yes, after 7th Jun 2014, they can initiate GO at any price.
I am also new to this, so fellow buddies, please help me spot my mistakes.
Also, there seems to be a glaring loophole, even if they do not act in concert right now (hence not triggering a GO), is it possible that they can "choose" to act in concert some point in future? What will happen then?
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(12-02-2014, 09:27 AM)Wildreamz Wrote: (12-02-2014, 08:02 AM)drzoidberg Wrote: (12-02-2014, 04:52 AM)Wildreamz Wrote: 1. The transaction between Gao Feng and Wang Peng/Dong Wu was completed on 7th Dec 2013. Hence, the earliest date that Dukang can be bought over from the public, without initiating a GO at $0.474 is 7th Dec 2014 (10 months from now).
First, thanks for sharing. Highly appreciated! =)
Secondly, I was wondering what GO means?
Thirdly, Im trying to understand the semantics of this, since english is not my mother tongue. Does this mean that Feng/Peng/Wu can buy Dukang from the public before the 7th December, if and only if they initiate a GO at $0.474. And after the 7th December, they can initiate a GO at any price? Is this correctly understood?
You are welcomed.
2 good resources:
1. http://www.cnplaw.com/en/files/articles/...220610.pdf
2. http://www.mas.gov.sg/~/media/resource/s...nnex_2.pdf
GO means General Offer. Based on SGX rules shareholders initiate a GO when they have acquired 30% or more of the total shares, they have to make the offer at the highest price they used to acquired the shares, 6 months prior to the GO (I realize I made an error, the earliest date should be 7th June 2014, 4 months from now).
Yes, after 7th Jun 2014, they can initiate GO at any price.
I am also new to this, so fellow buddies, please help me spot my mistakes.
Also, there seems to be a glaring loophole, even if they do not act in concert right now (hence not triggering a GO), is it possible that they can "choose" to act in concert some point in future? What will happen then?
SGX has already ruled that the two parties are not acting in concert, therefore not required to issue a GO. If they choose to act in concert in future, there is nothing much SGX can do unless they flout SGX rules.
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(13-02-2014, 10:35 AM)arriyana Wrote: SGX has already ruled that the two parties are not acting in concert, therefore not required to issue a GO. If they choose to act in concert in future, there is nothing much SGX can do unless they flout SGX rules.
I don't understand. So can sgx stop them? Or can't they?
Anyway, look forward for Dukang's result later today.
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14-02-2014, 10:34 PM
(This post was last modified: 14-02-2014, 10:43 PM by rogerwilco.)
Wildreamz, do you know any Dukang's product innovation (taste, category, packaging) that differentiate it from its competitors? Dukang is a good brand and I like the ads (that you wrote in your previous post) but i'm afraid just relying on the brand name alone with conventional advertising (TV, bus and rooftop ads) would be a difficult and long road to take, especially when competing with competitors with more renowned brand name and deeper pocket
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Overview:
Very tough times for Dukang.
The impact was larger than I thought.
The only silver lining is the increase sales volume of regular series Dukang holds strong and continued to increase (albeit only 4%) y-o-y. Market share should have grown modestly or at least, remained the same.
However, the same cannot be said for the Siwu (premium and regular) and Dukang (premium) series of Baijiu.
Business Outlook:
I think going forward, Dukang should focus more on the more famous Dukang name.
Utilization of capacity (105%) was high. I assume it indicates that the decline in overall sales volume (especially the Siwu series) might be intended by management or at least anticipated before hand.
Net profit, if corrected for increased Advertising and Promotion expense of 30.5m RMB, should be 40.5m RMB; or a decline of 71.9%.
Earnings per share this quarter is around 1c SGD per share before A and P.
What investors could look forward to:
1. Dukang will probably continue to enjoy positive free cash flow due to the low capex nature of its business. And the resilience/modest growth of their Dukang regular series.
2. This year will be the year where Dukang will slowly fine tune its product mix and advertisement strategy; slowly winding down Siwu production and ramp up Dukang production and marketing. I don't think Dukang have the resources to promote more than 1 brand (Siwu and Dukang) they should just go market their Dukang in full force (which I think that was what they have been doing, I haven't seen any Siwu ads personally during my research).
3. Increased capacity should kick in by the end of this year, bringing yearly capacity to 10,000 tons. Hope sales can pick up by then for them to fully utilize these capacity.
4. Dukang claim that they should be able to start selling Dukang Baijiu to the Singapore market by last October, and they are following up with South Korea and Thailand.
But they have been talking about expanding world wide for years, I don't think we should see any big change in overseas contribution this year. However, this is a potential area where they can surprise us on the upside.
Risks
1. Continued price pressure from competitor.
2. Continue marketing pressure from competitor.
3. Privatization on the cheap.
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(14-02-2014, 10:34 PM)rogerwilco Wrote: Wildreamz, do you know any Dukang's product innovation (taste, category, packaging) that differentiate it from its competitors? Dukang is a good brand and I like the ads (that you wrote in your previous post) but i'm afraid just relying on the brand name alone with conventional advertising (TV, bus and rooftop ads) would be a difficult and long road to take, especially when competing with competitors with more renowned brand name and deeper pocket
I am not an expert in Baijiu so I'm not qualified to comment on taste etc.
However, from the business point of view I think Baijiu is essentially a commodity like product with little difference to differentiate one from another, especially when they are marketed to the masses. Brand power is the only thing that allows them to command such high margins.
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(14-02-2014, 11:48 PM)Wildreamz Wrote: I think going forward, Dukang should focus more on the more famous Dukang name. I can't agree more on this, imho Dukang's management should consider winding down/selling the Siwu brand. To target the mid market they already have Luoyang Dukang regular brand.
(14-02-2014, 11:55 PM)Wildreamz Wrote: I am not an expert in Baijiu so I'm not qualified to comment on taste etc.
However, from the business point of view I think Baijiu is essentially a commodity like product with little difference to differentiate one from another, especially when they are marketed to the masses. Brand power is the only thing that allows them to command such high margins.
I am also no baijiu connoisseur  but I slightly disagree, I think the process and ingredients used in making the baijiu can be used as differentiator. For example: beer can be considered as commodity but a smoked beer with a vanilla hit and toasty sweetness would attract new buyer.
The craftmanship involved in making the product can also be used as 'soft' advertisement
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15-02-2014, 05:12 PM
(This post was last modified: 15-02-2014, 05:18 PM by CY09.)
Why did Dukang borrow RMB160M in Q2, despite having RMB500M cash as a group excluding the borrowed RMB160M loans.
Trouble in one of its brands? Please don't tell me Dukang has to borrow more to maintain banking relationship
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