Agoracom Blog

Chinese Small-Cap Company Feature: China Energy Corp

Posted by AGORACOM at 9:30 AM on Tuesday, April 20th, 2010

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.


China Energy Corp. (OTC.BB:CHGY)

China Energy Corporation produces and processes raw coal for domestic heating, electrical generation and coking purposes for steel production primarily in the People’s Republic of China, and acts as a brokerage in facilitating coal trade transactions. The Company produces coal through its subsidiary Inner Mongolia Tehong Coal Group Co, Ltd. (“Coal Group”) and supplies heating and electricity requirements throughout the XueJiaWan district through its subsidiary Inner Mongolia Zhunger Heat Power Co., Ltd. (“Heat Power”).

On April 20th, the Company reported it’s financial results for the first quarter of its fiscal year ending November 30, 2010.

Check out the full details below:

Read Full Press Release

Chinese Stocks TV Segment


  • Revenue of $20.8 million, an increase of 314.1% over revenue of$5.0 million generated in the first quarter of fiscal year 2009.
  • First quarter fiscal year 2010 sales from the Company’s coal group increased 962% to $16.2 million, or 78.2% of total sales, compared to $1.5 million, or 30.5% of total sales in the same period in fiscal year 2009.
  • Net income in the first quarter of fiscal year 2010 totaled approximately $4.0 million, or $0.09 per share, compared to a loss of approximately $0.5 million, or $0.01 per share in the first quarter of fiscal year 2009.
  • Cash and cash equivalents totaled $3.7 million on February 28, 2010 compared to $5.1 million on November 30, 2009. The Company had total stockholders’ equity of $37.3 million, with total assets of $85.9 million versus total liabilities of $48.6 million on February 28, 2010.


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

1. – 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.


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