Sweet Tidings

China Lifestyle Food And Beverages Group (SIN:E69) is a fast moving consumer goods company that holds the second largest market share for PRC jelly desserts retailing under its brand "LaBiXiaoXin". Margin of Safety first featured this company in March 2006 when it was trading at S$0.235. It closed for this weekend at S$0.425. Investors over this period who placed their faith in the counter will be licking up sweet returns in excess of 80% over the space of eight months.

China Lifestyle reported its financials for the first nine months of FY2006 over the weekend. Compared to the previous period for FY2005, its net profit soared 20% to RMB64 million, underpinned by robust top line growth of 32% to RMB404 million. Its net profit margin was roughly steady at 15%.

Going forward, China Lifestyle intends to build on its brand recognition further by airing a series of commercials on CCTV. It also intends to launch at least 10 new products, including the "Labixiaoxin" brand of potatos chips in FY2007. The potato chips is the first product introduced after the group's tieup with another SGX listed company, Super Coffeemix Manufacturing Ltd (SIN:S10) in August 2006.