Tianli Agritech (OINK)

[Sheikhmarzoog]

Tianli Agritech - A Significantly Undervalued And Oversold Stock [View article]
Thanks for your comments. A couple of additional thoughts, which I may formalize into another article in the near future:

So the question everyone asking is whether OINK is a fraud. How can the financials be trusted? How can I be absolutely sure that everything that I read and everything the management team says on the conference calls is the truth. The short answer is that I can't be 100% sure. But here are my arguments for why I believe OINK is the real deal:

1) OINK became public through the traditional IPO process, not a Reverse Merger (or RTO). The IPO process is much
more stringent than the Reverse Merger merger process and requires an extensive amount of due diligence by US regulators. If Tianli wanted to defraud US investors, why would they go through the painful process of the traditional IPO process?

2) Tianli is a very simple company. The assets (i.e., pigs, farms, feed, etc.) and locations of the hog farms are easily verifiable: all locations are listed on the website (http://bit.ly/HKErcv). The company even gives tours to investors (http://bit.ly/HKEtRx).
Also, the retail products can be found in the retail superstores in Wuhan (Wal-Mart, Zon 10, RT Mart).

3) Crowe Horwarth, an audit firm that I would rate "2nd Tier" also
looked at financials for Q2 and Q3 2011. The fact that the financials
did not change during the switch from Sherb most likely means the assets are real. I have a hard time believing two different auditors along with the management team are all conspiring together.

4) I've been in touch with other large long-term investors in the stock and they've also spoken to Management (CFO and Board of Director members) numerous times on their business, strategy, etc. They are all long-time holders of the company and don't have plans to sell their shares any time soon. They also believe OINK is grossly undervalued.

So I added this all up and asked myself, what side would I want to be on: the short side or long side? And the answer is simple: I'd rather be long.