Weikang Bio-Tech (PINK:WKBT)

GeoTeam® September 2010 Rodman & Renshaw notes:

Weikang Bio-Tech Group (OTC BB:WKBT)

• Growth coming from new product lines. Should have 7 new products begin by the end of first quarter 2011
• There are three phases to launch a new product. Phase one is getting approval of product. Phase two is applying and getting license for product. Phase 3 is product launch.
• Time frame to get a product from phase 1 to 3 varies, but usually takes several years.
• New products reach maturity within 2 to 3 years. Most products have a 5 to 7 year life span. When demand slows we lower price to increase demand.
• May look to raise capital to fund our growth needs, mainly for acquisitions and to address capital funding requirements dealing with its reverse merger. (The GeoTeam had originally surmised that no near term funding arrangement would be on the horizon).
• Weather disruption in the second quarter of 2010 which effected top and bottom line growth for the quarter. It was a one time event, which effected most businesses in the area. We had delays in shipping which effected revenue for the quarter. However, the orders were filled and should be reflected in the third quarter.
• Main risk factor is our competition. Our research and development team and our founder is what separate us from our competitors. He is very well respected in the industry.
• We sell through 6 major distributors in 5 different provinces. We also have 60 smaller city distributors.

Note: We have suggested to management to provide 2011 EPS guidance upon the third quarter press release.