Featured Company

Dragon Capital Group Corporation

Dragon Capital Group Corporation (OTC: DRGV) is a holding company with a majority stake in several emerging technology companies in the People’s Republic of China. It was established to cultivate business opportunities in China. The Company focuses on information technology markets for wireless internet applications and mobile business solutions, enterprise management and computerized automation systems integration, network integration and management, as well as other IT products and services. It offers support in the critical functions of general business consulting, formation of joint ventures, access to capital markets, mergers & acquisitions, business valuation, financial management and revenue growth strategies. The current focus of Dragon Capital Group is on the development of 3G-based mobile applications, business solutions and information technology.

Through its subsidiaries, the Company has industry relationships with leading global technology and telecommunications firms, including a strategic partnership with Tencent Holdings Limited, a premier wireless content provider in China, to offer third generation (3G) wireless services for two top-tier Chinese telecommunications companies, China Mobile Hong Kong Ltd. and China Unicom Ltd. The Company is also an authorized agent for Epson, Cannon, Hewlett Packard and OKI products. In addition to four operating high-tech companies acquired in 2005, the Company announced in 2006 two further acquisitions further strengthening its revenues and confirming the management’s commitments to growth. The Company is positioned to become a diversified marketer of innovative technologies in the rapidly growing information technology and wireless communications sectors in China.

Company Strategy

The Company’s strategy entails a structured approach of identifying underlying technology market trends in China, investing in promising business opportunities, either by acquisition or other venture capital arrangements, developing significant revenue streams and growth strategies, as well as continually operating subsidiaries until potential spin-off or divestiture. By pulling together innovative companies from related high-tech segments, the model optimizes resources and promotes opportunities for synergistic business relationships within the portfolio group.

The members of the Company’s corporate high-tech community gain an immediate competitive advantage by having access to resources often unavailable to their standalone local counterparts in China. At the same time, the controlled hands-on management of the investments provides credibility for western investors otherwise reluctant to assume business risks in uncharted environments. With seasoned on-site management, the Company has established and maintained effective work relations and contacts within various governmental agencies, public institutes and private industries in China at both national and provincial levels, such as the Ministry of Foreign Trade and Economic Cooperation, State Development Planning Commission, Ministry of Construction, Ministry of Agriculture, Ministry of Science and Technology, Chinese Academy of Agricultural Sciences, State Drug Administration, China National Federation of Textile Industries and China National Center for Biotechnology Development.

In the past eighteen months, the Company has been strengthening its market position and shareholder value by acquiring attractively priced targets strategically fitting into its portfolio of companies, in a way to maximize crossmarketing opportunities and optimize respective cost structures. Currently, the Company continues to evaluate additional strategic acquisition opportunities in various information technology fields, including wireless applications, other telecommunications technologies and software development, and anticipates completing more acquisitions in the next year.

China Market Overview

China is the latest investment frontier for growth oriented investors seeking a new opportunity. The combination of China’s massive size and rapid modernization is creating one of the greatest investment opportunities of the 21st Century. The Chinese government is increasingly encouraging entrepreneurial spirit amongst a nation of 1.3 billion people. Numerous startups and high growth companies have hit the ground running, contributing to China’s rapid GDP growth.

China is a dynamic market for international investors. China is the world’s fourth largest country and the world’s fastest-growing economy. Developing effective and profitable investments in China is undoubtedly the greatest single opportunity for investors today. Since 1978, when China opened its doors to the outside world, China has enjoyed tremendous annual economic growth.

China has the world’s fastest growing economy, on average, at better than 9% per year for the past 25 years. China’s economy is growing seven times faster than the U.S. economy and has doubled GDP growth each of the past seven years. China’s economy is the fourth largest in the world, behind only the U.S., Germany, and Japan. China is the world’s single biggest recipient of foreign direct investments. China’s accession to the World Trade Organization is widely expected to trigger a further wave of inward investment from foreign companies as the terms of entry to new sectors of the China economy are progressively liberalized.

China Telecommunications Industry

The telecom market in China is an emerging industry. Presently industry sources indicate the penetration rate at 30% of the population: our management believes there is still considerable room for a company like Dragon Capital to become a major player in the Chinese telecom landscape.

According to the China Business Weekly (January 18, 2004), there were approximately 200 billion text messages transmitted by over 270 million cell phone subscribers in 2003. According to a report by Ministry of Information Industry of China, there were over 500 billion text messages transmitted over 350 million cellular phone users in 2004. The China Industry Report in 2004 projected levels of cell phone use to be over 500 million by 2006. The Chinese refer to this SMS boom as the ‘thumb economy’, which generated over $2 billion in revenues in 2003, an increase of 15 times from $248 million in 2003.

Over the last decade, the Chinese telecom sector has gone through certain key reforms that have taken highly regulated market dominated by the monopolistic China Telecom into a market featuring competition. Dragon has set its sights on a very healthy segment of telecom and has made inroads, partnering with the leading Chinese telecom companies in China including China Mobile, China Telecom and China Unicom to bring cutting-edge SMS 3G-based technology and business solutions to an expansive list of Chinese companies.

 

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