Replies to post #196 on China Carbon Graphite Group, Inc. (CHGI)

[Steuvin]

Mr. Jin, the new board member, is the son of the major shareholder. Whether or not he is particularly well qualified, I cannot tell.

I do not believe, and never said, that CHGI is fraudulent. Their business is very weak with $3 million in revenue in Q1, whereas their competitor in China, Fangda, had $180 million in sales. They have $50 million in short term debt and cannot possibly retire the debt when it comes due. They must rely on China rolling over the debt, despite the fact that they were cash flow negative in Q1 even before paying the interest on their debt.

BDO, their former auditor, pointed out that their accounting system is way under par. They replaced BDO when it wanted to place a warning that the company might not be able to continue as a going concern.

Buy the stock if you want to.