Secondary Recommendation

Bodisen Biotech - Impressive debut for fast-growing Chinese organic fertiliser maker

March 2006

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

In spite of its wacky name, recent AIM issue Bodisen Biotech, which is dual listed on AMEX, is actually a highly profitable and fast growing manufacturer of proprietary organic fertilisers and pesticides in China. Investor appetite for all things Chinese is part of the explanation for the fact that the shares opened at a 25% premium to the 730p issue price, with Bodisen taking the opportunity to raise £10.6m new money. However, the fact that Bodisen’s sales have ballooned from US$4.9m in 2002 to US$23.6m in just the nine months ended last September, from which a pretax profit of US$6.4m was generated, is arguably the main reason why the heavily oversubscribed shares soared to 886p. That leaves its market value standing at &po ...

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