Call to Action: Ocean Bio-Chem (OBCI) – Added to our GeoBargain OBCI position in yesterday’s trading session.

Added OBCI ($5.10; marked up to $5.75 pre market) – On 10/8/2014 on our message boards, then via email, we alerted members that we were adding to our OBCI position and coding it as a GeoBargain.  Recall, we stated OBCI sells a disinfectant product (yet to be launched) that is designated by the EPA as proven to be effective against Ebola.  Today, CNBC highlighted an Ebola killing robot that uses UV light to kill different bacterias and viruses. We think OBCI could benefit from a media focus that’s shifting from Ebola drugs and treatment to methods of prevention and disinfecting.

Here are the stories that the GeoTeam is following today… (Please see full disclosures at bottom)

  • ChinaHybrid News not released in U.S
    • STV ($4.66; marked up to $5.00) – Yesterday we stated STV ($4.58) – Provided further update on its asset restructuring.  Tongda Venture has agreed to acquire the 100% equity interest in Beijing Super TV Co., Ltd., a wholly-owned subsidiary of Golden Benefit, for a consideration that has been preliminarily determined to be RMB3.2
      billion (RMB 800 million in shares of Tongda Venture and RMB2.4 billion
      in cash).  The Tongda Venture which STV holds for over 17% after the restructuring started trading (halted before) in the China Mainland A share stock market and went up 10% yesterday (the China A share market has a 10% upside or downside limit, so that’s the highest up each day).
  • ChinaHybrids
    • VNET ($19.39) – Announced that the Company has established joint venture named Smart Time Technologies Limited , with the leading global electronics manufacturer, Foxconn Technology Group for the IDC and cloud computing business. The total amount of the investment in this joint venture is $25 million with VNET of 60% equity interest and Foxconn of 40%, respectively.
    • SYUT ($4.41) – Announced preliminary Q2 2015 financial results.  The Company anticipates revenue in the range of $106-110 million, representing year-over-year revenue growth of at least 20%. Net income attributable to common stockholders is expected to be in the range of $9-10 million, compared to $6.1 million in the second quarter of fiscal 2014, representing year-over-year growth of at least 50%.

For more timely information, particularly during the daily trading session, we urge our members to read our message board posts daily.

Disclosure: Long OBCI ; Other Long Positions; Other Short Positions; Pump & Dump Positions (Password GEO2014)

Summary of general highlights:

On the Asian Front…

21 Vianet Group(NASDAQ:VNET)($19.39) – the largest carrier-neutral Internet data center services provider in China, announced:

the Company has established Smart Time Technologies Limited (“Smart Time Technologies” or “Joint Venture”), a strategic joint venture, with the leading global electronics manufacturer, Foxconn Technology Group (TWSE:2354) (“Foxconn”). 21Vianet and Foxconn (together the “Companies”) will invest a combined total of US$25 million in the initial phase of the cash investment in return for 60% and 40% equity interest in the Joint Venture, respectively. Through this Joint Venture, 21Vianet and Foxconn will jointly build and develop a global supply chain for the internet data center (“IDC”) and cloud computing infrastructure markets. In addition, the Companies also announced that they plan to open a 21Vianet-Foxconn Internet Infrastructure and Engineering Technology Research and Development Center. This development is expected to further strengthen the technological collaboration between the two companies.

Mr. Frank Meng, president of 21Vianet, stated,

“We are very excited to take this significant step in advancing our strategic cooperation with Foxconn, a Fortune 500 company which possesses world-class R&D and engineering technologies in the areas of cloud servers, storage devices, network equipment, and other key products. This critical partnership will allow the Companies to pool resources and technologies and collaborate operationally. We believe that our cooperation will accelerate the development of the IDC market in China and lead it to become increasingly industrialized, modular-oriented and factory-driven. Through the Joint Venture, we will strive to not only provide the Chinese market with superior cloud data centers that feature green, modular and high-efficiency technologies, but also target the international cloud computing market over time.”

Mr. Huifeng Wu, Vice President of Foxconn Group, said,

“By combining Foxconn’s leading cloud computing solutions, cloud servers, storage devices and IDC cabinets and its many global industrial park expertise with 21Vianet’s strong experience in IDC operations and rich resources in network infrastructure and customer relationships, we believe the Joint Venture will facilitate the vertical integration of the IDC value chain, helping to build a complete cloud computing eco-system. We are confident that the Joint Venture is not only an important step in the strategic transformation of Foxconn, but also a positive catalyst to improve the scale and pace of 21Vianet’s global IDC deployment.”

Synutra Intl (NASDAQ:SYUT) ($4.41) – which owns subsidiaries in China that produce, distribute and sell nutritional products for infants, children and adults, announced unaudited preliminary second quarter 2015 results and raised full year 2015 guidance:

For the second quarter ended September 30, 2014, the Company anticipates revenue in the range of $106-110 million, representing year-over-year revenue growth of at least 20%. Net income attributable to common stockholders is expected to be in the range of $9-10 million, compared to $6.1 million in the second quarter of fiscal 2014, representing year-over-year growth of at least 50%. These positive results were due to increased IMF sales at the distributor and retail channels.

Based on its strong preliminary second quarter and first half fiscal 2015 results, the Company now maintains its forecasted revenue range of $450-500 million, while raising its fiscal 2015 net income guidance from a range of $50-60 million to $55-65 million.

Mr. Liang Zhang, Chairman and CEO of Synutra said,

“We are pleased to see continued strong demand for our core formula brands. In the second fiscal quarter, we experienced sequential and year-over-year increases in both revenue and net profit, despite significant market competition.  Our success this quarter was primarily due to increased shipment volumes in a traditionally slow season as a result of our increased strategic marketing efforts.  We expect this momentum to continue in the coming quarters, resulting in strong top line growth and greater operating leverage in fiscal 2015.”

For more timely information, particularly during the daily trading session, we urge our members to read our message board posts daily.

Sincerely,

The GeoTeam