11 December 2009

LIM & TAN

20 CECIL STREET

#09-00 EQUITY PLAZA

SINGAPORE 049705

TEL: 65330595 FAX: 65332368

www.eq.com.sg

RCB Reg No. 197301030WSECURITIES PTE LTD

CHINA XLX

Lim & Tan SECURITIES PTE LTD

Call SELL

Watch For Unwinding Of Speculative Positions S$0.68 - CXLX.SI

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opened at HK$4.95 fell to an intra-day low of

HK$3.86 before recovering to close at HK$4.04

on volume of 4.645mln shares compared to

4.073mln shares and 3.77mln shares the last 2 days

of trade.In Hong Kong, China XLX’s share price which

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hit an intra-day low of 66 cents before recovering

to close at 68 cents on 48mln shares compared to

83mln and 182mln shares traded the last 2 days.On SGX, the stock had opened at 74 cents and

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equivalent price would be about 72 cents which is

only a premium of 6% to Singapore’s last close of

68 cents, narrowing significantly from the first day

peak of 100% and yesterday’s opening price of 16%.At Hong Kong’s last close to HK$4.04, the

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correction in Hong Kong’s share price to HK$4.04

currently compared to the first day intra-day high

of HK$10 its PE of 23x remains expensive relative

to its much bigger peer We continue to caution that even with the sharpChina Bluechemical’s

16-17x PE (China Bluechemical’s market cap of

HK$21.9bln is 442% bigger than China XLX’s

market cap of HK$4.04bln).

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Kong and Singapore over the last 3 days, the huge

volumes generated in Singapore may not be able

to find a home in Hong Kong. Besides, investors

hoping to capitalize on the price diff may not be

able to do so any more given the only 6% price diff

currently (it takes 3 weeks to transfer shares from

Singapore to Hong Kong).Given the huge volume discrepancy between Hong

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speculative positions over the next few days could

put further pressure on the stock (average trading

volume in the last 4 weeks was only 4mln shares

while the day before the Hong Kong listing was

3.2mln shares and the share price was at 51 cents.

This compares to 182mln traded on Tuesday, 83mln

on Wed and 48mln on Thursday). We maintain

SELL.

Exhibit 1: Daily Closing Since IPOThis suggests that potential unwinding of

China Energy was recommended to me 3 mths ago and now suffer same fate as this counter ...it has gone from $0.340 (plus / minus) 3 months ago and drop till today's price........

LOL today lose another 6.85%. HKSE is adjusting to SGX price, those who buy hope SGX will adjust to HKSE.

Anyview on will it be heading south or north??????  Now currently is tracking it to have a feel of Dual Listing Effect.

icic...i guess not cos i do not have much to burn, in fact i cant afford to burn anymore...

*sad-ed...