Dapai International Holdings (formerly "China Zaino")

[yeokiwi]

Expected....
No money to squeeze so has to abort mission

DAPAI INTERNATIONAL HOLDINGS CO. LTD.
Company Registration No.: 41211
UPDATES ON THE PROPOSED RENOUNCEABLE UNDERWRITTEN RIGHTS ISSUE OF UP TO
248,062,500 NEW ORDINARY SHARES (THE "RIGHTS SHARES") IN THE CAPITAL OF THE
COMPANY AT AN ISSUE PRICE OF S$0.08 FOR EACH RIGHTS SHARE, ON THE BASIS OF 1
RIGHTS SHARE FOR EVERY 4 EXISTING ORDINARY SHARES IN THE CAPITAL OF THE
COMPANY HELD BY SHAREHOLDERS OF THE COMPANY AS AT A BOOKS CLOSURE DATE
TO BE DETERMINED, FRACTIONAL ENTITLEMENTS TO BE DISREGARDED (THE “RIGHTS
ISSUE”)
The Board of Directors (the "Directors" or the “Board”) of Dapai International Holdings Co. Ltd (the
"Company" and together with its subsidiaries, the “Group”) refer to the announcement dated 9 June
2011 (the “Announcement”) relating to the Rights Issue. Unless otherwise defined, all capitalised
terms used herein shall bear the same meanings ascribed to them in the Announcement.
The Directors wish to update Shareholders that the Company has had discussions with the
Singapore Exchange Securities Trading Limited regarding the proposed Rights Issue exercise and
understood that as the proceeds of the Rights Issue are intended to be used for a proposed
acquisition for which no agreement has been signed as yet and which when signed, will require
shareholders' approval, it is therefore pre-mature for the Company to carry out the proposed Rights
Issue exercise at this stage.
In view of the foregoing, the Company will postpone its plans for the proposed Rights Issue exercise
and will update Shareholders accordingly by way of announcement when and should it decide to
proceed with the rights issue exercise again.
By Order of the Board
Chen Xizhong
Executive Chairman
6 July 2011

[yeokiwi]

UPDATES ON THE PROPOSED ACQUISITION

The Board of Directors (the "Directors" or the “Board”) of Dapai International Holdings Co.
Ltd (the "Company") and together with its subsidiaries (the “Group”), refer to the
announcements dated 9 June 2011 and 6 July 2011 (the “Announcements”) relating to the
Rights Issue. Unless otherwise defined, all capitalised terms used herein shall bear the
same meanings ascribed to them in the Announcements.
The Directors wish to update the Shareholders that the negotiation on a potential
acquisition of a suitable target in the backpack and luggage business segment from an
independent third party by the Group has ended as no consensus could be reached during
negotiations between the two parties for the proposed acquisition and the target party has
called off further negotiations.
In view of the foregoing, the Company will not proceed with the aforesaid proposed
acquisition.
The Directors would also wish to refer to the announcement date 8 June 2011, relating to
the use of proceeds of placement completed in May 2010, that since the Company will not
proceed with the proposed acquisition, the net proceeds of S$9.3 million will be used for
working capital.

PROFIT WARNING
___________________________________________________________________________
The Board of Directors of Dapai International Holdings Co. Ltd. (the “Company”), together
with its subsidiaries (the “Group”), wishes to announce that after a preliminary assessment
of the Group’s financial results, the Board would like to advise the shareholders that the
Group is expected to record a significant drop in its financial performance for the half year
ended 30 June 2011 (“1H 11”).
The significant drop in its financial performance for 1H 11 was mainly attributed to:-
(i) the slowdown in sales of our backpack and luggage products;
(ii) an increase in selling and distribution expenses; and
(iii) an increase in administrative expenses.
Further details of the Group’s financial performance will be disclosed when the Company
announces its unaudited consolidated financial results for 1H 11 on or before 12 August
2011.

Cancel acquisition and profit warning.

In their first quarter report, Dapai was going to build a factory to output 4 millions luggage.
They also managed to open 500 dapai outlets by march 2011!

Do so much work and yet the sales had slowdowned...

Interestingly, I did a calculation on the average rental of the dapai 500 outlets.(RMB 160 million for 2 years)
So, each outlet rental cost per year is S$30000.(per month is S$2500).
In china standard S$2500 should be a very expensive figure??

Total prepaid renovation, furniture and fitting cost of 500 outlets = RMB 230million
Each store average renovation cost is S$88000!
Looking at the photos below, i think china renovation cost is really expensive.
http://photo.jmw.com.cn/pic/2010/6/6/155...sRNZK8.jpg
http://www.huangmei123.com/kb/page.asp?c...&shopid=23
http://brand.4006666688.com/brandshop/4097

$$$ fly away...

[Nick]

Very fortunate that SGX stepped in to prevent the rights issue from taking place or else the money would be sitting idle now...

[corydorus]

There are many ways to run a business and earn money. How we do it matters.
I can see some changes with the Current SGX Management which i fully support and respect.

[d.o.g.]

Kaboom. Another one bites the dust.

http://info.sgx.com/webcoranncatth.nsf/V...0003015F2/$file/DAPAI_3Q11.pdf?openelement

They are the leading company in their segment, and they had to lower prices by 50% to encourage their distributors? Wow. Doesn't sound like their products were all that great to begin with, then.

And one year after spending RMB 50m to renovate 500 sales outlets, the money was all written off. RMB 26m of prepaid rent was written off too.

I hope at least a few members heeded the warnings that were sounded here and avoided this catastrophe.

[Contrarian]

> They are the leading company in their segment, and they had to lower prices by 50% to encourage
> their distributors? Wow. Doesn't sound like their products were all that great to begin with, then.

> And one year after spending RMB 50m to renovate 500 sales outlets, the money was all written off.
> RMB 26m of prepaid rent was written off too.

'Leaders'
- must verify how they define
- Leadership does not always translate into pricing ability
- Pouring $ to 'support' distributors or outlets / brand building...

Business environment is certainly very tough now... especially if they are not the dominant players

[Musicwhiz]

I would take the term "leaders" to mean (or at least signify or imply) market leaders. This would indicate they had the lion's share of the market, or at least a significant proportion of the pie.

It would also, by extension, imply that they had some pricing power because of superb branding or influence with regards to shelf space in retailers shops/department stores.

But obviously from the numbers, pricing power has been severely eroded.

[kazukirai]

I went back to the beginning of the thread and re-read it.
All I can say is we're so fortunate to have d.o.g. and all the others who highlighted this stock for the dud that it is. Hope it saved some retail investors who found it as a function of some screens for the usual cheap criteria (low p/e, high eps growth etc)

A little knowledge can sometimes be a really dangerous thing.

[yeokiwi]

I had serious doubt over the commentaries and figures in the latest financial statement. It looks to me that they are trying their very best to deplete their cash hoard. If I am right, we will see another large drop in cash holding in the next quarter.

and also trying their best to explain how they spent the IPO money.

[Nick]

RECEIPT OF WRIT OF SUMMONS

The Company wishes to inform shareholders that a writ of summons from Proton Investment
(Asia) Limited ("Plaintiff") has been served on it, naming the Company and its Executive
Chairman, Chen Xizhong ("Mr Chen"), as the first and second defendants, respectively.

Under the writ of summons, the Plaintiff alleges the Company and Mr Chen are obliged to repurchase
47,250,000 shares in the Company from the Plaintiff at S$0.30 each (amounting to an
aggregate S$14,175,000), arising from the Company not proceeding with its proposed dual
listing on The Stock Exchange of Hong Kong Limited.

The Company is discussing its response with its legal advisers and intends to contest the claim
vigorously.

The Company will keep shareholders updated of any material updates, as applicable.

By Order of the Board

Chen Xizhong
Executive Chairman
23 November 2011

http://info.sgx.com/webcoranncatth.nsf/V...100293AF4/$file/Dapai_ReceiptofWritofsummons.pdf?openelement