iBankCoin
Don't pay dollar to keep 2 cents when wrong. Cut your losses quickly. Trade what you see, not what you think.
Joined Oct 26, 2011
719 Blog Posts

A case for the $KNDI Dec $7.50 Call

Yes, I bought a boat load of this calls this morning.  Here are my reasons:

  1. – On September 17th, the Chinese Ministry of Finance announced the long anticipated renewal of China’s New Energy Vehicle (i.e. electric vehicle or EV) subsidies.
  2. – China’s first car-sharing scheme starts in Hangzhou
  3. – JINHUA, China, Aug. 9, 2013 (GLOBE NEWSWIRE) — Kandi Technologies Group, Inc. (the ‘Company’ or ‘Kandi’) (Nasdaq:KNDI), today announced that the construction of pure EV smart vertical parking and charging facilities for public EV sharing system (the ‘Project’) is right on schedule. According to the updated progress report, there will be five pure EV smart vertical parking and charging facilities completed in the coming September. By the end of 2013, 30-40 pure EV smart vertical parking and charging facilities are expected to be built in Hangzhou City. In a year from now, 5,000 to 10,000 Kandi pure EV ‘JNJ6290EV’ model and Kandi-Geely co-developed Brand ‘JL7001BEV’ will be deployed in Hangzhou City based on the progress.
  4. – The pilot project for Public EV sharing project is very well received by Jinshan District of Shanghai and the local government is in the process of the location selection. The trial operation of Shanghai’s public EV sharing system is expected to be launched before the end of 2013.

Notice that on point 3 and point 4, if business is progressing as planned which I’m betting that it will, $7.50 will be easily taken out before December comes around.

Chartwise, the daily chart looks like a cup & handle breakout is about to happen as soon as the $5.72 high is taking out.

KNDI_daily

Of course, this is a highly speculative play where if there is no progress in the business development per above, you can lose all your option premium.

My 2 cents.

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8 comments

  1. Raul3

    Ragin like it too, you’re in good company

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    • Zenhunter

      Yes, I noticed that RC was long $KNDI as well. 🙂 I truly believe the car sharing concept is the missing link that will allow the EV to proliferate giving current insufficient charging infrastructure. If we can see more car sharing vertical/charging garages being build all over China, watch out!

      Cheers!

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  2. lol

    NICE ONE.

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  3. nd4spdgt

    Nailed it.

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    • Zenhunter

      For now… since I intend to hold this one for awhile, I will consider “nailing it” when the price takes out the $7.50 strike price. Tomorrow may be interesting since there are 6,000+ contracts of Sept call option @ $5 strike price that may be exercised. If there are a big percentage of naked calls in the bucket, tomorrow may be a short-squeezed day…

      Thanks and Cheers!

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  4. Adam

    Interesting! been long a few contracts in the Dec 7.5s since 0.25, wishing i had more now

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    • Zenhunter

      Hi Adam,

      There should be five EV vertical and charging garages built by end of September and about 30 – 40 more by the end of the year. More if a province of Shanghai decides to take on the EV car-sharing program as well. If the plan progresses according to the timeline, you will do well with what you have.

      I was lucky to load up at 25 cents as well before the push up.

      Good luck and Cheers!

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