Value and Growth

I very much like the macro fundamentals of this company. The annual reports and prospectus are good reading.

Much of China's farmland is polluted, and every year there are scandals regarding unsafe food. Winha presents itself addressing the issue through importing high quality safe Australian food to China.

In reality, after enough digging, it actually appears that they have numerous plantations in China, so that at present much of there stores are being stocked with domestic produce (albeit some imports are noted).

They have bought a 49% minority $3 million stake in the Australian company Flavours Fruit & Veg. My understanding is they plan to use this to source product from Australia to China, as well as try the reverse and sell some of their Chinese products in Australia. But I don't have the impression this has had a significant impact on revenue or earnings... yet, but should if the plan works.

This business model seems logical as a growing middle class in China will have greater disposable income to spend on higher quality food. Though as noted, I think the majority of their stock is sourced domestically at present. Regardless, it is a highly profitable and fast growing business at a low valuation, with a business plan I find compelling.

They have a parent company by the same name listed on the US OTCBB. Never a bad thing imo as it is an additional safety net and source of financial support.

Valuations are dirt cheap, there is a 3.5 cent dividend paid out for shareholders as of July, and management is said they are hoping to double their 800,000 customer base over the next year.

Have taken a half position at $.40, but will double in if it keeps falling. Have learned that the general direction of Chinese shares is down due to widespread negative sentiment. But the likely company growth, P/E of 1.3, and upcoming dividend are hard to ignore. DFM seems to be in a similar niche, though it is a larger company, growth prospects are lower and valuation is 3x the price at 3.9 P/E (which is moderately expensive as Chinese shares go). But, I think the DFM chart is instructive. WQW may do the same, and we may not be at a bottom yet. But I'm happy to wait and collect dividends in the meantime and double down if we're not at a bottom yet.

Do your own research. The majority of Chinese ASX companies are not worth buying, but I think there are some worth owning. This forum is silent. Anyone else interested in WQW?