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China 3C Group (CHCG)

Stock symbol: CHCG.OB…….…..……….…………..………….……… Ave volume (3mos) 240,400
Stock price 10/9/09: $.59……………..………………..…………….Common shares 6/30/09: 54mm
52 week Range: $.37 to $1.84….…..…………..……………Equity market capitalization: $31.8mm

Recent News …..Stock Price & Chart … ..SEC Filings

BUSINESS

. A leading wholesale distributor and retailer of 3C merchandise: computers, communication products and consumer electronics in Eastern China, the most developed and fastest growing area of the country.

. Goal is to become the number one retailer of 3C products in China. Currently the biggest “store-in-store” retailer of 3C products in Eastern China.
. Partners with large department stores and supermarkets, such as Wal-Mart, Carrefour, Best Buy, Trust-Mart, and Hualian.

GUIDANCE

. For the 2009 third quarter ending Sept 30, CHCG expects sales to be in the range of $40-$50 million and gross margin to be in the range of 10-11%.
. For the full year, the Company expects revenue to total approximately $200 million and gross margin to be in the range of 9-12%, Aug 17 read more

STORES

. CHCG had 979 store-in-store locations at the end of the second quarter of 2009 compared to 1,001 in the prior year period and 990 at the end of the first quarter of 2009.
. CHCG expects to reduce its total number of store-in-stores to 950 at the end of the third quarter of 2009 and 900 store-in-stores by year end.

GROWTH PLAN

. Planned to open 2-4 direct stores and 4-6 franchise stores in the third quarter of 2009 located in smaller cities and towns in the Zhejiang province.
. Anticipates that Jinhua Baofa, the recently acquired logistics company, will play a significant role in the build out of these new stores and will allow CHCG to more easily expand its distribution network and lower its transportation costs as CHCG services these planned new stores, as well as future stores."

COMPLETES ACQUISITION, July 6

. For $17.4mm acquired Jinhua Baofa Logistic, Ltd, a well-known transportation logistics company in Eastern China
. For the year ended December 31, 2008, Jinhua had revenue of $10.5 million, net income of $1.9 million and gross margin of 34.9%. July 6

OTHER ACQUISITIONS

. On August 3, 2006, completed the acquisition of a 100% interest in Sanhe for a cash and stock transaction valued at approximately $8,750,000. The consideration consisted of 915,751 newly issued shares of the Company’s common stock and $5,000,000 in cash.

. On November 28, 2006, completed the acquisition of a 100% interest in Joy & Harmony for a cash and stock transaction valued at approximately $18,500,000. The consideration consisted of 2,723,110 shares of the Company’s common stock and $7,500,000 in cash.

INCOME STATEMENT SUMMARY

Balance sheet comment: solid cash position and no debt

Address: 368 Hushu Nan Road, Hangzhou City, ZHJ 310014, China
Telephone: +86-0571-88381700
CEO: Zhenggang Wang
Web Site: http://www.china3cgroup.com/

State or other jurisdiction of incorporation or organization: NV
Transfer Agent: Madison Stock Transfer
Investor contact: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

MANAGEMENT TEAM

CEO, Zhenggang Wang

Mr. Wang was born in Yiwu, a city famous for its small commodities trade. Mr. Wang started selling small electronics, such as telecommunication electronics, in 1990. A pioneer in the industry, in 1997 Mr. Wang established Yiwu Yong Xin Communication Ltd., which was engaged in the sale of telephones and fax machines, where he served as its Chairman and Chief Executive Officer. In 1998, Mr. Wang established Hangzhou Wang Da Electronics Co., Ltd., which was engaged in the sale of mobile phones. In 2005, Mr. Wang became the CEO of Zhejiang Yong Xin Digital Technology Co., Ltd. He was the first person to utilize the “store-in-store” business model to sell 3C Products. Mr. Wang received his EMBA from Zhejiang University.

“Technological developments can revolutionize our lives. The future will be an era of 3C, and 3C products will be everywhere in the world. China 3C Group will strive to become the number one seller of 3C Products in China, and we will try our best to increase shareholder value.” ——— Zhenggang Wang

President, Xiang Ma

From 1996 to 1999, Mr. Ma was a manager in charge of telecommunications at Zhejiang Chuanhua, a high-tech company listed in China. From 1999 to 2007, Mr. Ma served as the General Manager of Yiwu Yong Xin Communication Ltd. Mr. Ma received his bachelor’s degree in Business Administration from Zhejiang University.

Yong Wu

Mr. Wu most recently served as the Sales Manager for East China at CR Vanguard Limited, one of the largest supermarket chains in China. From 2000 to 2005, he worked as a sales manager for East China at Trust-Mart Department Stores Co, a well-known department store chain. Mr. Wong began his career in 1996 at COFCO Le Conte Food (Shenzhen) Co, Ltd., one of China's largest candy manufacturers. He rose to the level of General Manager of East China, which was the most important sales region for this company. Mr. Wu graduated from Zhejiang University School of Economics and Management, one of China's top universities.

IPOdesktop (ID) SAFE HARBOR STATEMENT: Statements contained in this document, including those pertaining to estimates and related plans, potential mergers and acquisitions, estimates, growth, establishing new markets, expansion into new markets and related plans other than statements of historical fact, are forward-looking statements subject to a number of uncertainties that could cause actual results to differ materially from statements made. ID provides no assurance as to the subject company's plans or ability to effect any planned and/or proposed actions. ID has no first-hand knowledge of management and therefore cannot comment on its capabilities, intent, resources, nor experience and makes no attempt to do so. Statistical information, dollar amounts, and market size data was provided by the subject company or its agent and related sources believed by ID to be reliable, but ID provides no assurance, and none is given, as to the accuracy and completeness of this information.

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