The increasing demand for green fertilizers in China bodes extremely well for organic fertilizer companies -- especially two of my current Asia Edge recommendations. Let's take a closer look at each, and why their shares are headed higher.
One of the Most Recognized Brands in Chinese Green Fertilizers: It is the largest organic fertilizer company in China, producing and distributing humic acid-based, liquid compound fertilizer in 27 Chinese provinces today.
What sets it apart from the competition is its R&D facilities, where the company develops all of its own fertilizers. Currently, the company offers more than 100 individual fertilizers that are tailored for specific plants, growing conditions and functions.
Because of the company's popular tailor-made fertilizers and the rising demand for green fertilizer products in China, this company has experienced strong income and revenue growth over the years. For fiscal 2008, it reported a 49% increase in revenue and a 37% jump in income from a year earlier.
Looking ahead, I expect this company to leverage its new $15 million greenhouse research facility and gain even more market share. Shares are up nearly 40% in four months. Don't miss the next leg higher -- join Asia Edge today!
A Recent Organic Fertilizer IPO: In early September, another Chinese organic fertilizer company listed its shares on the NASDAQ, catching my attention. This company produces fulvic acid-based fertilizer products, which are primarily used to increase the yield of plants and animals.
The company's main target, though, is crops, which account for 90% of total sales. This makes sense considering that fulvic acid strengthens the walls of plant cells and speeds up nutrient and mineral absorption by crops, making it a top choice for Chinese farmers.
Currently, the company is marketing its fertilizers in 10 provinces with its products being sold in 5,000 independently owned stores. These stores are part of the company's branded store network, which places its products in featured displays throughout the stores. Overall, this is helping build up the company's brand recognition in China.
Looking ahead, the company recently raised is revenue guidance for 2009, expecting between $89 million and $90 million. Considering that the company has very limited competition in China, I'm expecting it snatch up a large portion of China's organic fertilizer industry.
Shares are up nearly 10% since I recommended it following its recent IPO. So now is a great time to get on board before its shares really take flight. I'm expecting at least a 60% gain by yearend. Don't miss out -- join Asia Edge today!
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