China Sun Group Hi-Tech Co. (CSGH)

[atco1982]

Some Comments by reading between the lines:

1. The prior long list of potential customers has not gone away. Those were mostly for cobalt products and they eat up all they can produce.
2. Don't worry about Zack. His blog, or a summary, will soon be on thestreet.com.
3. Did a calculation on the numbers from the COO. He is only including the product production numbers. Does not include the revenues or profit from the subsidary. But the growth can easily be seen.
4. The LIP product mostly goes to a 'state owned' battery producer:
"Lithium iron phosphate (LIP) anode materials made by China Sun have
been used in the manufacture of LIP power batteries manufactured by
Beijing Shuangsheng Technology Company."

http://www.bjsskj.com.cn/en_index.php

I suspect the deal to get the recent grant for production increase came with a deal to provide LIP product for some time in the future. Therefore, China Sun material used for their own battery products are downstream. It's a tradeoff. Free money (no dilution) for production increase now versus low production volume and LIP battery products now. Note this government policy statemente and grant (free money):
"One of the key projects selected is the industrialization of lithium iron phosphate (LIP) used as an anode material for Li batteries manufactured by Dalian Xinyang High-Tech Development Co., Ltd. ("DLX") a 100% owned subsidiary of China Sun Group. This project will benefit from the support of the Committee and the Dalian government through the award of subsidies which will help insure a successful and timely ramp up of LIP production.

DLX forecasts that during the period from 2009 to 2012, it will have invested a total of $17.6 million (120 million RMB) in the R&D and industrialization of LIP. DLX invested $6.6 million (45 million RMB) in 2009 and expects to invest an additional $2.5 million (17 million RMB) during 2010. By the end of 2012, DLX expects to achieve a manufacturing capacity of 2,000 tons. This requires investment in 12 production lines in addition to state of the art equipment. Currently DLX is capable of producing up to 50 tons of LIP per month used in 100Ah's automobile power batteries, which have been certified by the National Automobile New Product Quality Supervision and Test Center."

5. I think the 5-10 year for China Sun batteries is based on 'free' money deal with the government. Suspect nothing constrains them from 'other' sources for financing (cash from operations, stock sales, or outside financing) to go beyond the 12 production lines and produce LIP material for their own battery products.