blog.chinasecurities.com

As many of you know, we are very bullish on the long-term future of Chinese small cap and mid cap companies for two reasons:

1] The obvious reason – China is the fastest growing economy on the planet and nothing is going to slow down its ascent over the next 50 years and beyond. Investing in growth companies there just makes too much sense.

2] Great Results and Valuations - Many Small Cap Chinese Companies are listing in the US (OTCBB, NYSE Alternext and NASDAQ) with great financial results. Unlike many dubious US Small Cap Companies, Chinese Companies don’t seem to believe in losing money or failing to execute in a business plan. As such, 7-digit revenues and profits are very common.

From a valuation point of view, many Chinese companies became a victim of their own success in Q4 2008 and Q1 2009. Why? When the world needed to start liquidating, one of the first places they looked were China where most investors had significant gains to sell into. This resulted in the proverbial baby being thrown out with the bathwater and some great valuations.

TODAY’S FEATURED COMPANY

Puda Coal (NYSEAmex:PUDA)

Puda Coal, through its subsidiaries, supplies premium high grade metallurgical coking coal used to produce coke for steel manufacturing in China. The Company currently possesses 3.5 million metric tons of annual coking coal capacity. The Company has recently moved upstream into coal mining, as a consolidator and acquirer of coal mines in Shanxi Province.

On May 13th 2010, Puda Coal announced its 2010 first quarter financial results.

Check out the full details below:

Read Full Press Release

Chinese Stocks TV Segment

HIGHLIGHTS

– First quarter revenue increased 24.6% year over year to $62.0 million

– Gross profit increased 165.4% year over year to $10.3 million

– Gross margin increased 8.8% year over year to 16.6%

– Operating income grew 207.4% year over year to $9.1 million

– Net income gained 157.3% to $5.4 million, or $0.31 per fully diluted share, as compared to $2.1 million, or $0.14 per fully diluted share,

in the first quarter of 2009

– Excluding the $1.2 million in non-cash expense related to the fair value loss of derivative warrants, adjusted net income increased 215.5%

to $6.7 million, or $0.37 per fully diluted share, as compared to $2.1 million, or $0.14 per fully diluted share, in the same period last year

– Sales of cleaned coal increased 10.3% year over year to 503,000 metric tons (MT)

– Average selling price of cleaned coal grew 12.8% year over year to $123 per MT

YOUR RESEARCH STARTING POINTS FOR CHINESE SMALL CAP AND MID CAP COMPANIESWe’ve provided investors with two great starting points to research great Chinese small cap and mid cap companies.

1. ChinaSecurities.com – ChinaSecurities.com tracks 250 of the best small cap and mid cap companies trading on North American exchanges. It provides you with the best of the best in two ways. First, the front page lists the best news of the day coming out of the space. It does so by giving you a text view of the best press releases by industry and via Chinese Stocks TV, a 5-minute broadcast every morning just after the open. Chinese Stocks TV is archived, so you can catch up on shows you missed.

Second, if you want to research each of the 250 companies to find candidates for your portfolio, it has a very intuitive directory that lets you quickly review each company on the master list, or parse it out by industry and exchange if you have a particular sector of interest. Cool stuff.

2. Right here on AGORACOM, you can refer to our China category for other featured Chinese Small-Cap Companies. As always, we will disclose any IR relationship with any public company. Given the sheer number of great Chinese Small-Cap Companies out there, you can expect us NOT to have an IR relationship with most of these companies.

Regards,
George

As many of you know, we are very bullish on the long-term future of Chinese small cap and mid cap companies for two reasons:

1] The obvious reason – China is the fastest growing economy on the planet and nothing is going to slow down its ascent over the next 50 years and beyond. Investing in growth companies there just makes too much sense.

2] Great Results and Valuations - Many Small Cap Chinese Companies are listing in the US (OTCBB, NYSE Alternext and NASDAQ) with great financial results. Unlike many dubious US Small Cap Companies, Chinese Companies don’t seem to believe in losing money or failing to execute in a business plan. As such, 7-digit revenues and profits are very common.

From a valuation point of view, many Chinese companies became a victim of their own success in Q4 2008 and Q1 2009. Why? When the world needed to start liquidating, one of the first places they looked were China where most investors had significant gains to sell into. This resulted in the proverbial baby being thrown out with the bathwater and some great valuations.

TODAY’S FEATURED COMPANY

Hong Kong Highpower Technology (Nasdaq: HPJ)

Hong Kong Highpower Technology develops, manufactures and markets rechargeable nickel metal hydride (Ni-MH) and lithium-ion (Li-ion) batteries and related products for use in a variety of electronic devices. The majority of Hong Kong Highpower Technology’s products are distributed worldwide to markets in the United States, Europe, China, Hong Kong, Southeast Asia and Taiwan.

On May 12th, 2010, the Company announced financial results for the first quarter ended March 31, 2010.

Business Highlights

–  Achieved 79% increase in net sales to $20.2 million for first quarter 2010 from $11.3 million in first quarter 2009;
–  Generated gross margin of 21% for the first quarter 2010; up sequentially from 19% for the fourth quarter of 2009;
–  Earned net income of $0.12 per diluted share for first quarter 2010, a 300% increase over the first quarter of 2009;
–  Improved business conditions and outlook;
–  Debt-to-capital ratio remained healthy consistent with prior quarter.

Check out the full details below:

Read Full Press Release

Chinese Stocks TV Segment

HIGHLIGHTS

– Generated gross margin improvement to 21% in 2009 compared to 17% for 2008;
– Earned net income of $0.33 per diluted share for 2009, a 122% increase over 2008;
– Continued production ramp of Li-ion batteries to average monthly production rate in excess of 800,000 units for fourth quarter 2009, a
100% increase in production over the same period in 2008;
– Debt-to-capital ratio remained healthy consistent with prior quarter.

YOUR RESEARCH STARTING POINTS FOR CHINESE SMALL CAP AND MID CAP COMPANIES

We’ve provided investors with two great starting points to research great Chinese small cap and mid cap companies.

1. ChinaSecurities.com – ChinaSecurities.com tracks 250 of the best small cap and mid cap companies trading on North American exchanges. It provides you with the best of the best in two ways. First, the front page lists the best news of the day coming out of the space. It does so by giving you a text view of the best press releases by industry and via Chinese Stocks TV, a 5-minute broadcast every morning just after the open. Chinese Stocks TV is archived, so you can catch up on shows you missed.

Second, if you want to research each of the 250 companies to find candidates for your portfolio, it has a very intuitive directory that lets you quickly review each company on the master list, or parse it out by industry and exchange if you have a particular sector of interest. Cool stuff.

2. Right here on AGORACOM, you can refer to our China category for other featured Chinese Small-Cap Companies. As always, we will disclose any IR relationship with any public company. Given the sheer number of great Chinese Small-Cap Companies out there, you can expect us NOT to have an IR relationship with most of these companies.

Regards,
George

As many of you know, we are very bullish on the long-term future of Chinese small cap and mid cap companies for two reasons:

1] The obvious reason – China is the fastest growing economy on the planet and nothing is going to slow down its ascent over the next 50 years and beyond. Investing in growth companies there just makes too much sense.

2] Great Results and Valuations - Many Small Cap Chinese Companies are listing in the US (OTCBB, NYSE Alternext and NASDAQ) with great financial results. Unlike many dubious US Small Cap Companies, Chinese Companies don’t seem to believe in losing money or failing to execute in a business plan. As such, 7-digit revenues and profits are very common.

From a valuation point of view, many Chinese companies became a victim of their own success in Q4 2008 and Q1 2009. Why? When the world needed to start liquidating, one of the first places they looked were China where most investors had significant gains to sell into. This resulted in the proverbial baby being thrown out with the bathwater and some great valuations.

TODAY’S FEATURED COMPANY

Agfeed Industries (Nasdaq: FEED)

AgFeed Industries (www.agfeedinc.com) is a U.S. company with its primary operations in China. AgFeed has two profitable business lines — animal nutrients in premix, concentrates and complete feeds and hog production. AgFeed is one of China’s largest commercial hog producers in terms of total annual hog production as well as one of the largest premix feed company in terms of revenues. China is the world’s largest hog producing country that produced over 645 million hogs in 2009, compared to approximately 100 million hogs produced annually in the U.S. China also has the world’s largest consumer base for pork consumption.

On May 11th, 2010, the Company announced its financial results for the first quarter ended March 31, 2010.

Check out the full details below!

Read Full Press Release

China Stocks TV Segment

First Quarter 2010 Financial and Operating Highlights

• Revenue for the first quarter reached $52.9 million an increase of 58% compared to the first quarter of 2009.
• Production volumes increased by 24% in the Company’s hog division and 119% in the animal nutrition division, as compared to the same period in 2009
• Gross profit of  $ 6,3 Million compared to $5,8 Million quarter over quarter

YOUR RESEARCH STARTING POINTS FOR CHINESE SMALL CAP AND MID CAP COMPANIESWe’ve provided investors with two great starting points to research great Chinese small cap and mid cap companies.

1. ChinaSecurities.com – ChinaSecurities.com tracks 250 of the best small cap and mid cap companies trading on North American exchanges. It provides you with the best of the best in two ways. First, the front page lists the best news of the day coming out of the space. It does so by giving you a text view of the best press releases by industry and via Chinese Stocks TV, a 5-minute broadcast every morning just after the open. Chinese Stocks TV is archived, so you can catch up on shows you missed.

Second, if you want to research each of the 250 companies to find candidates for your portfolio, it has a very intuitive directory that lets you quickly review each company on the master list, or parse it out by industry and exchange if you have a particular sector of interest. Cool stuff.

2. Right here on AGORACOM, you can refer to our China category for other featured Chinese Small-Cap Companies. As always, we will disclose any IR relationship with any public company. Given the sheer number of great Chinese Small-Cap Companies out there, you can expect us NOT to have an IR relationship with most of these companies.

Regards,
George