Sino Grandness

Sino Grandness: Strong set of results, which was in-line with bullish estimates, as the grp continues its outstanding performance as net profit at Rmb70.3m, +25% y/y, in tandem with a 32% increase in revenue to Rmb376.6m. We note that first quarter has seasonally been the slowest quarter for grp. While gross margins improved further to 40.5% vs 37.5% y/y. Stellar top-line was attributable to a 50.3% increase in its Beverage business to Rmb238.9m, and a 936% increase in domestic canned products to Rmb298m. Although this was partially by a 3% decrease of RMB3.2m from sales of canned products in overseas market. Going forward, the grp remains optimistic about its overall performance in FY2013, while we note that given the strong beverage sales, the grp remains on track of a potential listing of its juice business (garden fresh). Ratings as follows: UOB Kay Hian maintains Buy with $1.66 TP