I bought some GNG recently at 18p (price now up to 26p) given:

- excellent trading update giving a current year P/E of 8 or 9 on likely 3p-3.5p EPS
- 2.6p historic EPS to 31/3/06 and a historic P/E of 10
- contract wins announced post-IPO in June 2006
- 1.9m of net assets, with 820k of cash, against a 6.8m m/cap
- results to be announced 28th November following the trading update

Here's the trading update:
http://www.investegate.co.uk/Article.aspx?id=20061031080000P4198

I gather GNG's CEO and CHairman (both superb English speakers) will be over here next week to tour the City, give press interviews etc.

GNG intended to raise $7m at IPO, but raised only 500k due to terrible matket conditions at the time in June. Despite this they've now announced that they're almost going to meet the broker's estimates as calculated on raising the full $7m.

GNG should now be on course to make around 3p-3.5p EPS this year to March'07. This leaves them on a current year P/E of only around 8 or 9.

Heres their IPO RNS from 23rd June 2006 (the Board of Directors is extremely impressive):

http://www.investegate.co.uk/Article.aspx?id=20060623081500PF52B

This is what GNG do:
GEONG has established itself as one of the market leaders in the Peoples Republic of China in providing content management solution software products and related services for large enterprises. GEONG's flagship product range, the GEONG PortalAge series, is used by the top 5 Chinese banks and 12 out of the top 20 securities firms in China. It is an enterprise server software product which combines a number of optional business solution components and customisation modules that can be used to provide individual solutions for a range of industries including those that require real-time or time critical applications such as internet banking.

Note the wording a range of industries.

In slightly more detail, GNG has a 6.8m m/cap, with 26.12m shares in issue.

GNG made $1.28m post-tax profit for the year to 31/3/06. At $1.87 that's 685k, or 2.6p EPS, for a historic P/E of just 10.

The brokers forecast on IPO was for $1.89m post-tax profit this year to 31/3/07, or around 3.7p EPS, for a P/E of just 7.

And per the pro forma in the prospectus GNG had at 30/4/06 1.9m of net assets, including 820k of cash, against the current 6.8m m/cap. Thus the continuing business making a $1.28m historic profit after tax is valued at just 4.9m.

The prospectus noted that GNG are trading in line, and there's been some excellent announcements post-IPO at the end of June to indicate that things are continuing to go well:

July : a $350k contract win with Huawei-3Com, who employ more than 4,500 people worldwide:
http://www.investegate.co.uk/Article.aspx?id=20060724074128PFD9C

October : a $500k contract win with Air China:
http://www.investegate.co.uk/Article.aspx?id=20061018071237PC25A

In the same RNS, GNG stated that their solutions "are already being used by Shanghai Airlines and China Travel International and will allow us to gain a larger share in this fast growing sector."

October : core supplier status from IBM:
http://www.investegate.co.uk/Article.aspx?id=20061018071206PB237

November : new contract win with China's Bank of Communication (one of China's "Big Four" banks):
http://www.investegate.co.uk/Article.aspx?id=20061121070205P7788

The reason for the post-IPO fall is some of the pre-IPO $300,000 loan note holders from late 2005 turning their converted stock for a quick profit, and a complete lack of PR. GNG also raised less than they hoped for on IPO because they floated just after the FTSE had dropped calamitously from 6,100 in May to 5,600 - this of course also contributed to the artificial fall in the share price post-IPO.

Note also from the prospectus that 80.16% of the shareholders, including the directors, are locked in for from 6 months to a year, so there are only 5.2m shares in free float, or around 1m worth.

On a 6.8m m/cap, a company making 1m post-tax profit could have rather a long way to go imo. DYOR etc.

Corporate website : http://www.geong.com/Site/Home/EN

You will say this again in 2 months time, GD.

Thanks hlyeo, I was following this thread and bought in at 62p and now I am in profit. I believe this will go further in nature of its business. I think more contracts on the way.

You are most welcome, justyi.

HI 98 where you see this at the end of this week i like to put you on the spot so i can hear wt cynic as to say.............lol

no you wouldn't! ... lol

hi cynic how you doing........wt you think the week brings

opening with gloom and doom and threats of the end of the world! ...... Expect (hope!) Dow will stage some sort of recovery, perhaps even later today as that index hits a support (11950 from memory, but will check) ...... the sustainability of any recovery is however very questionable

considering the bloodbath all around, a very solid performance indeed here .... down just a nominal 1p

Investors know GNG has a strong management and still cheap comparing to other similar companies and has huge upside in the long term.

today, the one has nothing to do with the other! ..... real baby and bathwater day!!

A 225,000 buy just came up in GNG

Spoke too soon...-4p at the moment from -1 earlier.

Down 6.5p to the minute now.

Grrrr!

why r u surprised?

Oh never mind...it's only money, cynic...can earn it back.

98 wts going on with GNG don;t tell me cynic is right again ..........enough cynic your starting to be a jinx..........lol

Isaiah (aka Cynic) says you should see some respite today, but this is not the end of market turbulence and falls

GNG up today. almost 100k traded: GNG Bid: 66p Offer: 68p Change: 7

Current Forecasts :

HH - No recommendation - 16th Feb 07

2007 PTP ?
2007 EPS = 2.93p

2008 PTP ?
2008 EPS = 5.16p


Seymour - Outperform - 22nd Feb 07

2007 PTP 0.87m
2007 EPS = 2.92p

2008 PTP 1.18m
2008 EPS = 3.69p


Is there a newer HH note ? Given they do not give a recommendation, or even PTP figures, I cannot see how they get to their 08 EPS figure, when they should know a secondary placing should be done before too long imo.

Anyone got a link to the HH update on the 16th Feb ? or indeed any newer one ?