China MinZhong: JP Morgan slashes TP to $1.10 from $2.20. Note that crisis of confidence in the sector may keep valuations depressed.
Chaoda corporate governance issues have led to sector de-rating. MINZ’s reappointment of its present auditor may not sufficiently satisfy market expectations. Nonetheless, MINZ’s on track farmland expansion and moving up the value chain with higher ASP/margin crops such as king oyster mushrooms, asparagus, and black fungus underlie its favorable growth prospects. General vegetable prices in China have also recovered by 11% from the June
trough as of the end of Sept.
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