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

Rivaldo, you should defnitely work in sales, if you don't already :o)

Glad I didn't sell last week when I was tempted to.

GNG having another good day :- GNG Bid: 30p Offer: 31p Change: 2.5 162k traded

Making more progress today too: GNG Bid: 30p Offer: 33p Change: 1

I like this one -not yet on the radar but will eventually really take off IMO. Added a few today plus a few new ones I've put on drivers tips. CCH and VIY are doing well are you in those Soul?

Hi MP, I am not in either of those as yet, although I thought VIY looked interesting.

I am not particularly liquid at the mo, but might have a go at a Chinese petrochemical co called Haike which is due to float shortly.

I was very overweight in sola-so I sold a small amount to fund my new picks-VDS looks promising too.

Well, here we are, winning contracts again (and if winning contracts flicks your switch, check out my CBOX thread :o)


Geong International Limited - New Contract Wins
Immediate Release 6 February 2007

GEONG INTERNATIONAL LIMITED

NEW CONTRACT WINS

GEONG International Limited ('GEONG' or 'the Company'), the AIM listed, Beijing
based, provider of content management software and solutions, announces that it
has signed a US$150,000 contract to provide its PortalAge software to Haitong
Securities ('HTS'), the number one securities firm in the PRC.

GEONG also announces that it has signed two contracts with China Asset
Management Company ('ChinaAMC') one of the biggest mutual fund companies in
China. The contracts are together worth US$110,000.

GEONG's PortalAge WCM (Web Content Management) V5 software will be used by both
HTS and ChinaAMC to improve their e-trading systems. Geong's PortalAge has
significant competitive advantages over alternative software products and is
used by the top five banks in China.

Commenting on the two contracts, Wang Weidong, Chief Executive Officer of GEONG
, said: 'We are delighted to have won further contracts in this key sector for
our products. Financial services is a booming industry in the PRC and is an
area where we have a strong presence and expect significant growth going
forward.'

FWIW turnover in the first half of the current financial year (i.e. to end Sept 2006) was US$3.15 mil. I'm not quite sure how current revenues and the recently announced contracts are being spread, but it sounds encouraging.

The wins I have totted up since the end of the first half add up to almost $US3 mil. Again, I don't know how useful a guide this is, but it looks good.

EDIT The revenue stream is "heavily weighted to the second half of the year" and so the remaining 7 weeks could also bring more good news.

and up some more: GNG Bid: 33p Offer: 35p Change: 3.25 1.3 million traded today.

And even better progress today: GNG Bid: 38.5p Offer: 41p Change: 5.75

The SP has set a new all-time high of 40p. 350k traded so far.

Kicking myself that I sold 20k of these before the rise-I thought I had time to buy elsewhere and come back later! still hold 13000 so must be happy with that for now-JTCod on the other side bought 300000 shares yesterday triggering the rise and it looks as though his admirers are following him in. Very promising investment this one. lots of new contracts.

Thanks for that update, MP. haven't had time to take a look at the other side recently (am in the throes of leaving the country, so am a bit busy, to say the least), but it's interesting that JT is backing this so strongly. I'm definitely chuffed with the fact that GN keeps winning new orders.

Another nice climb to start the week: GNG Bid: 39p Offer: 42p Change: 3.75

202k traded

Not a bad start to this week either soul traders! Now 43p mid. Not many of us here yet, so nice and quiet too - wait till the wider market catches on.

FYI I've had it confirmed by Henry Tse that I'm right about why GNG were able to issue a trading statement for the year so early. The major revenue contribution this year is still PortalAge related projects, for which there are signed contracts and a sales pipeline, and these have enabled GNG to look ahead as announced in October.

It's now up to others to finally pick up on the hidden message here.

I'm particularly interested to find out if the trading statement from October may have been superceded, with all the additional PortalAge contract wins since then and SmartBox seemingly doing really well - if so forecasts may have to be lifted. We shall see.

Good stuff, Riv.

I have to say that this one seems to be full of nice surprises. 44p to buy is a new all-time high as well.

GNG Bid: 42p Offer: 44p Change: 5

IMO the markets are only just waking up to this one---the future chinese microsoft is what I'm hearing!! Good trading statements so the next results should send it sharply up -fingers crossed.

I certainly have no complaints! Except perhaps that maybe I should have bought a few more shares already! Will have to give that some thought . . .

Still movin' on up. Only 3,000 shares seem to have been traded, but hey, if today's rise sticks, that'll be five days of rising SP on the trot.

GNG Bid: 44p Offer: 47p Change: 1

47p is yet another new high, too.

Moneyplus, that's a great line - "the future Chinese Microsoft"! Where did you hear that - down the Dog and Duck?! Or are you really hearing good things, and if so where?

......or did you hear it from a Seymour Pierce analyst?! Good news tonight - Seymour Pierce have started coverage of GNG with an "outperform" rating (and that must be at this morning's 44.5p price) - in traditional brokerspeak that means that when GNG come out with their 31/3 results they can say "I told you so" and upgrade to Buy...


http://www.newratings.com/analyst_news/article_1480819.html

"Geong International initiated with "outperform"

Thursday, February 22, 2007 8:51:50 AM ET
Seymour Pierce

LONDON, February 22 (newratings.com) - Analyst Amit Thakkar of Seymour Pierce initiates coverage of Geong International Ltd (ticker: G2Z) with an "outperform" rating.

In a research note published this morning, the analyst mentions that the Enterprise Content Management (ECM) market in China, to which the company caters, is expected to grow at a CAGR of at least 50% going forward. Geong International has a client base of 50 large enterprises, to which it provides PortalAge and SmartBOX products, the analyst says. The company is expected to achieve 25% annual earnings growth over the next couple of years, Seymour Pierce adds."