Xingquan

The 4Q2011 listing of two small cap casual wear stocks in HK could leave a footprint in Xingquan, which is well overdue for an upward re rating given its huge valuation discount to the two stocks. The stock could also be catalysed by a resumption of dividends. The two small cap casual wear stocks that were listed in HK in 4Q2011 are now trading at seven times to eight times of CY12 PER. This is much higher than the two times PER for Xingquan, which is also involved in casual wear in China . Xingquan is fairly similar in size to the two companies, with a CY12 net profit forecast in between AGH and COH.

Ex cash, its 2012 PER is less than one times. Most of the China show producers listed on Bursa Malaysia are trading at only two times PER.

Target Price: 1.47 (CIMB)