Sino Grandness

[Behappyalways]

To be honest I am quite cynical. I think that the banks do not want to lend them.......why? your guess as good as mine......(nice to re-read Eratat's borrowing from SHK)

Their cash level as of 2Q2014 is RMB60m. They need the money to pay off part of the bond plus operating and investing needs....hence they need the proceeds from the new share subscription...The 3Q2014 result is not out and when it is out one can getting a better idea on their cashflow.

For those who are vested or intend to be vested, pay attention to the company's cashflow.

Strange to be borrowing such a high interest rate from convertible bond plus option to convert into shares while bank loan is only RMB23m. Why not borrow more from bank and pay off the convertible. Since you have such a 'popular' and 'killer' product I assume the bank would be most willing to lend out the money.

Watch the cashflow. The company might need the share subscription to help them. If share price falls and the subscription does not go thru, then they might have a problem.

Good point, with the terms of the new deal, and SG's gearing level, I think bank borrowing would be a better option.

Caveat: Sino is not a fraud. That said, from what I gather, anecdotal accounts from various sources does indicate that Garden Fresh is rather popular and well known in Shenzhen.