Stock Hold Call: Jishan Holdings by DMG & Partners Securities!

DMG & Partners Securities said it has resumed coverage of Jishan Holdings Ltd, a Chinese-based producer of fabric dyes, with a "hold" rating, saying the company's operating environment remains challenging after the US re-imposed quotas imports of some categories of textile products. With the lifting of restrictions on the global textile and apparel trade in January last year, Chinese exports of textiles and apparel to the US surged and textile prices fell. This surge in exports to the US and EU resulted in the US re-imposing quotas for some categories of textile products. A new agreement between the US and China came into effect on Jan 1, and will last until Dec 31, 2008. This agreement provides for a progressive increase in the annual rate of growth of exports of Chinese textile products to between 10 and 17 pct by 2008. "The situation surrounding the trade dispute seems less uncertain at this point. We re-initiate [sic] coverage with a 'hold' recommendation, as we await management's execution of its plans for strategic alliances," the brokerage said in a note to clients. Jishan has indicated that it seeking strategic alliances to grow its business. DMG said that when these alliances take off, Jishan will experience exponential growth.