Company info: it is diversified holding company has business in steels, real estate, bio-chemistry and others (mining & finance). It also hold controling or significant interest in the following public companies: 43.08% Nanjing Iron & Steel (600282.sh), 52.29% Forte (2337.hk), 49% Fosun Pharma (600196.sh), 18.2% Yuyuan (600655.sh) and 17.27% Zhaojin Mining (1818.hk).

Financial data: 1) 1H07’s revenue up 29.4% and profit up 98.9%; 2) 06 P/E ratio 40.7 and 07 forward P/E ratio 28.8; 3) 06 return on equity 27.5% and debt equity ratio 482.0% (dropped to 272% in 1H07).5) 78.0% & 76.5% revenue generated from Steels; 6) Main reasons to profit increase are a. profit margin improve; b. contribution from new plant.

Sector info: because it is a diversified company, it involves in different nature of business with different profit margin and face different challenge and risk. 1) the most similar company I can think of is Citic (0267) which involves in steels, real estate, consumer and transportation business. I will stay away from multi sectors diversified company (other than Warren Buffett's) because it is hard for management to stay focus, normal with a conplicate structure makes it unclear to see through the whole picture and problem with resource allocation; 2) Steels business is highly driven by demand & supply, profit is heavily in line with raw material price. Since the growth is hard to predict, so i will stay away from material sector lor. In short run, I think the growth will still be strong.

Outlook:  1) FoSun used the 40% fund from IPO to paid off $0.6B debt and acquire/open some new plant. I can see the 1H07 result looks great and i will expect 07 result looks great too; 2) It plans to IPO Nanjing Steel (parent of Nanjing Iron & Steels) next year. Looks like FoSun would like to expand further and improve productivity.

Risk: 1) debt equity ratio is too high; 2) Steel price is at historical high now, will the demand & the price continue to grow? 3) Government’s marco alignment & monetary policy will affect the real estate sales.

Conclusion: my target price is $9.3, slightly lower than current price. I think current price already reflect all the great results, so I won't buy it lor.