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To: Spekulatius who wrote (44750)	10/2/2011 10:19:28 AM
From: MCsweet	Respond to of 78701

CCM, Clownbuck, good points but you miss the obvious. There was a US IPO for CCM in 2009. That is why the sharecount increased so much. The reason they have been expanding is that expansion was the entire purpose behind their IPO. It could be a sign of fraud, but you can't blame a company for following up on its IPO business plan. What's more, if they are continuing to expand then taking on debt while they can makes sense, as the remaining cash can be used to fuel the expansion later on. Since IPO they have decreased sharecount, having bought back stock last year. And of course they just announced a huge buyback. MC

To: Spekulatius who wrote (44750)	10/2/2011 6:43:53 PM
From: gcrispin	1 Recommendation Respond to of 78701

During the time that period where share count has increased from 17M to 49M, net income has increased from roughly 17M RMB to 131 M RMB. Income has gone from 1.02 per ADS to 2.66 per ADS in that same period. Regarding the loans, the following excerpt is from the most recent 20-F. Our short- and long-term debt obligations as of December 31, 2010 represent bank borrowings obtained by our subsidiaries. Our short-term bank borrowing outstanding as of December 31, 2010 had a weighted average interest rate of 4.60% per annum. Our long-term bank borrowing outstanding as of December 31, 2010 had a weighted average interest rate of 5.30% per annum. The 12 million is loans is principally with China Construction Bank and Agricultural Bank of China. I look at this as a positive since most Chinese ponzi schemes are debt free and, consequently, don't have to undergo the due diligence process of getting a loan. Since the latest IPO, CCM has repurchased 11 million dollars of stock and paid out, to my estimation 8 million dollars in a special dividend. This doesn't include the recently announced buyback on Friday. So if the company is trying to "dupe new shareholders" they are going to extreme measures. That also means they have duped Ernst and Young, General Electric, which owns 500,000 shares, two of the major four banks in China, and the short sellers, since there is are only 9000 shares short as of 9/15. Of course, anything is possible. (Anyone remember Worldcom, Enron, Tyco, and Global Crossing, if one believes that the Chinese have a lock on scandal) At least management has been proactive in supporting shareholders in the process.