Should You Buy Dongfang Modern Agriculture At This Share Price?

What happened to the DFM share price?

What happened to Dongfang Modern Agriculture [ASX:DFM]? Well, it got listed today, that’s what happened.

I was invited to attend the listing of DFM at the ASX in Sydney today.

It was a significant occasion for Chinese agriculture in Australia. Dongfang Modern Agriculture is the first privately-owned Chinese agriculture company to be listed on the ASX in over 20 years.

In my conversation with Richard Li, the executive Chairman of GoConnect [ASX:GCN] at the listing, he said that this could mark the beginning of more Chinese agricultural listings to come.

What should you do with DFM shares now?

This could be a very opportune time to list on the ASX for DFM. We are going through a bottoming process. But on the other hand, the strategic weight of agriculture will most likely gain against declining sectors such as mining.

When you put that in the framework of the latest free trade deal with China, you begin to see a trend of capital shift.

Chinese agriculture is a very interesting sector, because it is supported by the Chinese government. There is no tax on agricultural companies in China.

There is a clear regulatory bias towards supporting the agriculture sector in China and companies such as Dongfang Modern and Goconnect stand to benefit.

Ken Wangdong

Emerging Market Analyst, New Frontier Investor

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