Yamada Green Resources

Yamada Green Resources: The shiitake mushroom supplier saw 4QFY14 net profit surged to Rmb17.3m (4QFY13: Rmb0.2m), on revenue of Rmb81.4m (+46%), buoyed by favourable factors in all segments. The top line benefitted from higher yield (+53%) of self-cultivated shiitake mushrooms of 3,880 tonnes on favourable weather conditions, increased average selling prices (+20%) from revised contractual payment terms with its 12 distributors and better sales in both domestic and Japanese markets in processed food product business segment. Meanwhile, earnings were boosted by fair value gain of Rmb13m on its plantations. This brought FY14 earnings to Rmb102.6m (+48%) and revenue to Rmb611.4m (+20%). Yamada Green is expected to increase its harvesting capacity in moso bamboo for FY15, after expanding its total plantation area by almost three-fold to 33,845 mu (from 11,302 mu) after its harvesting season in FY14. Secondly, the group intends to increase its product offerings by developing new convenience food products in the processed food segment to capture the growth from increasing urbanisation and greater health-consciousness among the middle-and-upper income consumers. At $0.164, Yamada Green is valued at 4x P/E and 0.53x P/B.