Replies to post #86054 on China Growth Stocks

[2morrowsGains]

BOPH...Earnings due out tomorrow...Here are my DD Notes...

(All notes below are my opinion based on DD and prior cc notes)...

- Re: BOPH's recent ACCRETIVE acquisition...It's the real deal...
Here's the company Bohai recently acquired...
http://translate.google.com/translate?hl=en&sl=zh-CN&tl=en&u=http%3A%2F%2Fsdtzyy.com%2F
The acquired company has 5 leading products...
http://translate.google.com/translate?sl=zh-CN&tl=en&js=n&prev=_t&hl=en&ie=UTF-8&layout=2&eotf=1&u=http%3A%2F%2Fwww.yaopinnet.com%2Fc1%2Fd2495b.htm
To get an idea of what type of company this is, check out this list of their job openings from 2007. Scroll down the list and take a look at the requirments (including age requirments for some positions)...
http://translate.google.com/translate?sl=zh-CN&tl=en&js=n&prev=_t&hl=en&ie=UTF-8&layout=2&eotf=1&u=http%3A%2F%2Fschool.cnr.cn%2Fxyzsaq%2F200706%2Ft20070605_504483098.html&act=url
Acquisition 8k filing...
http://secfilings.nasdaq.com/filingFrameset.asp?FileName=0001144204%2D11%2D045138%2Etxt&FilePath=%5C2011%5C08%5C10%5C&CoName=BOHAI+PHARMACEUTICALS+GROUP%2C+INC%2E&FormType=8%2DK&RcvdDate=8%2F10%2F2011&pdf=

- Bohai (BOPH) is and has been hiring. Here's a recent list of their job openings (Check out the qualifications, especially for the accounting manager position)...
http://translate.google.com/translate?sl=zh-CN&tl=en&js=n&prev=_t&hl=en&ie=UTF-8&layout=2&eotf=1&u=http%3A%2F%2Fhuaian.01hrjiangsu.com%2Fcompany%2Fc-189248469404.html&act=url
Bohai's June 18, 2011 job recruitment...
http://translate.google.com/translate?sl=zh-CN&tl=en&js=n&prev=_t&hl=en&ie=UTF-8&layout=2&eotf=1&u=http%3A%2F%2Fjob.jiaodong.net%2Fsystem%2F2011%2F06%2F07%2F011300578.shtml&act=url

- A list of Bohai's lead products (phamaceutical drugs)...
http://translate.google.com/translate?sl=zh-CN&tl=en&js=n&prev=_t&hl=en&ie=UTF-8&layout=2&eotf=1&u=http%3A%2F%2Fwww.yaopinnet.com%2Fc1%2Fd44577.htm
10 products are on China's essential drug list and 17 are on on the National drug reimbusment list.(based on comments in the Q3 FY2011 cc).

- Persciption drugs = 61% of Q3 sales.

- Bohai is running at only 60% capacity, so plenty of room for growth. (Does not include acquisition).

- Has been working w/ NASDAQ to uplist. In the process of answering questions and at this time there are no major concerns. (Mentioned in the last cc that it now takes an enormous amount of time for a Chinese company to list on NASDAQ).

- Strong cash flow w/ low liabilities.

- Encourages shareholders to visit their facilities. (taken from the Q3 FY2011 cc).

- Re: Government Grants (1/31/11)...Bohai recieved $91,000 (RMB 600,000) from the Ministry of Science and Technology of the People's Republic of China and $53,000 (RMB 350,000) from the Yantai local government. The grants are to encourage the modernization of TCM drug-development in a manner more aligned with the typical development pathway of Western medicines.
http://ih.advfn.com/p.php?pid=nmona&article=46229496

- In January 2011, 44 individual investors paticipated in a small private placement in China paying $2.50 per share, which was a 23% premium to the closing price at the time. I believe these shares are restricted.
http://ih.advfn.com/p.php?pid=nmona&article=46136400

- Bohai mentioned in the last cc that they realize this is a tough time for Chinese companies, but management feels they are taking all the right steps now that will pay off for shareholders in the coming months and years.

- "2011 national tour of clinical quality".
"Manufacturers focus on negotiations, to achieve rapid distribution" (BOPH is the 7th picture down)...
http://translate.google.com/translate?sl=zh-CN&tl=en&js=n&prev=_t&hl=en&ie=UTF-8&layout=2&eotf=1&u=http%3A%2F%2Fwww.sosoyy.com%2Fnews%2Fsosodt%2F2011%2F61%2F1161102417E46FAGE05574C4J61G7A.html&act=url

New BOD member...
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=67465423

New Auditing firm w/ top ratings from PCAOB...
http://ih.advfn.com/p.php?pid=nmona&article=48289000
http://pcaobus.org/Inspections/Reports/Documents/2011_Bernstein_Pinchuk_LLP.pdf

THE BIG NEWS...The new auditors look to have given BOPH the GREEN light. FY2011 earnings will be released tomorrow...
http://ih.advfn.com/p.php?pid=nmona&article=49339368

Bottom line...Nine month adj pro forma EPS (inc the recent acquisition) is $0.65. (includes approx $0.25 from acquisition). And that's adjusted after backing out income due to changes in fair value of derivative liabilities.
Pro forma EPS should easily be $0.80++ for FY2011, but you never know...

We'll see how things look tomorrow!!