For long-term investments, I look for businesses that operate on high margin, produce high investment return, generate a lot of cash, and trade at attractive valuation. The recent IPO of Chinese online gaming company Giant Interactive (GA) is one that I find meets all of these conditions.

GA is a three-year-old company and a newcomer to the Chinese online gaming industry, specializing in MMORPGs (Massively Multiplayer Online Role-Playing Games). Its first MMO game, ZT Online, went into commercialization only in January 2006. However, this game proved the company to be a super-runner. ZT Online was rated the most popular online game in China in the same year by both IDC and game players.