Share price of China Minzhong opened higher at $1.11 and touched $1.12 today before closing much lower at the end of the day at $1.025.
Why has Mr. Market turned bearish on China Minzhong? Did the company report dismal results? No, on the contrary, results although not stellar are pretty encouraging.
China Minzhong actually saw a 5.9% increase in net profit to RMB 255 m for 3Q FY2013. This was on the back of higher revenue which increased by 27.7% to RMB 962.2 m.
Both cultivated and processed vegetables segments did well. Driven by growing domestic demand, the former's revenue improved 36%, year on year, while, driven by export demand, the latter's revenue improved 22%. Revenue from other processed products improved some 51.5%, reflecting strong demand for China Minzhong's branded products which include beverages.
What do all these tell me? The business is growing rather nicely. Then, why is Mr. Market selling ......