This China based traditional Medicine Company is an excellent value to Investors. A number of recent events have strengthened the company’s market position, making this quite a safe investment to consider with very nice upside potential. There are a number of reasons why now is the time to invest in this company, but five stand out as key indicators of its future prospect of success.
First is Global demand. Right now Alternative medicine is quickly gaining popularity and market share around the world. It represents a $30 billion dollar market in the US and Europe alone. This has to do with many consumers in these countries leaning toward green living. In fact, 80% of the world population is said to use some form of Herbal Medicine. So clearly, the potential market for the company’s product is huge.
Their stock right now is being priced at an extremely low multiple due to current market conditions. The price multiplier should be much higher given the recent GAP certification that they received. This leads to the next point.
GAP is essentially FDA approval for China and the EU so this is clearly huge. Similar company’s in the US receiving FDA approval trade at sometimes 40 times earnings overnight after the announcement. In fact, this is truly the Golden Egg of Alternative medicine companies. It gives them credibility with the government and consumers’ peace of mind knowing their product is safe. This also means the company can export to the US.
In the world of Alternative Medicine, the products that succeed are the ones that are the most easily marketed. That is why the company has chosen to put its eggs in one basket and focus on DAR, known for its many healing qualities including headaches, pain, blood pressure and many other ailments. This simplifies the complexities usually associated with promoting traditional medicine and allows the customer and the company to focus on one Branded drug. This has proven successful in India with the Ayurvedic system of medicine now representing a $1 billion dollar business.
Last week shares jumped almost 64% with the News that the company had added a successful research professor familiar with DAR to its team. Jia Minru comes from the Chinese Medicine University. He has headed a number of advanced studies in DAR and CHAUN as well as implementation of GAP standards. He brings over 40 years of experience to the company, a tremendous asset and great competitive edge over their competitors.
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