Blazing Research - Cogobuy Group Initial Coverage 20170522 EN

Summary
We are here to introduce another Hong Kong-listed Cogobuy Group

company sponsored by UBS, the renowned investment Company Information
bank famous for sponsoring fraudulent companies Industry Electronic
includes China Forestry, China Metal Recycling, Boshiwa Component
and Tianhe Chemicals. Cogobuy Group (Cogobuy) is Stock Code 0400
listed in 2014 July with UBS acting as sole sponsor, Listing Place Hong Kong
claiming itself to be the largest E-commerce IC platform Auditor KPMG
in China. Our investigation shows that not only did
Cogobuy fabricate its revenue and net profit since listing Our Recommendation
in Hong Kong, its online platform Cogobuy.com and the Rating
largest intelligent hardware innovation business
STRONG
platform IngDan is a complete scam. This report will SELL
present our evidences, including independent online Target Price HKD 0.53
traffic data and SAIC filings, to support our belief that
Cogobuy is just a fraud. Trading Data
Current Price HKD 10.0
1. An Outdated Online Platform that has been down Daily Volume 14 mn shares
for a week and without any traffics (5-day average)
From April 18 to April 26, Cogobuy.com has been down Market Cap HKD 14.8 bn
for a week without any maintenance. Independent online
competitive intelligence providers show that both IPO Data
Cogobuy.com and IngDan has a minimal amount of IPO Date 2014 Jul 18
traffics compared to its peers. Cogobuy.com almost has Sponsor UBS
no update since 2014, and with numerous bugs and Underwriter UBS, Jefferies,
errors. IngDan, the claimed entrepreneur IoT platform, is CCBI and CSCI
full of fake projects that are likely to be fabricated by a
mainland China employee. We believe the claimed GMV
of RMB 21.65 bn of Cogobuy is mostly fake.
By downloading or viewing our
2. Significant Discrepancy between Reported Figures report, you agree to our Term of
and SAIC Filings Service. For full details, please
We retrieved Cogobuys SAIC filings and discovered a refer to our disclaimer at the last
significant deviation between its revenue figures on SAIC page of this report.
Website: www.blazing-research.com / Email: blazing.research.m@protonmail.ch

filings and the reported figures on annual reports. Even after making generous assumption, the
revenue implied by SAIC filings is only around 40% of the reported figures. Moreover, its tax
figures on SAIC filings is only around 30% of the disclosed PRC tax expense, further corroborating
our finding.
3. Unparalleled Financial Performance compared to its Peer

The return of equity on Cogobuy is around 20% for four years already, significantly higher than
its peer and many other industries. Its growth rate in revenue and net income is also unparalleled
compared to its peers, stating the reason of high growth rate as driven by the one-step services
from the online platform, which we have already shown to be mostly fake.
4. RMB 1.9 billion of Difference between Net Income and Cash Flow
Although having a spectacular net income, the operating cash flow is mostly negative and much
smaller than the reported net income. From 2011 to 2016, Cogobuy reported a total net income
of RMB 1.23 bn, but its adjusted net cash flow from operations is negative RMB 0.67 bn, with a
difference of RMB 1.90 bn. Most of it goes to trade and other receivables and inventories, which
are growing much faster than the revenue. Cogo Group, the former entity of Cogobuy, also has a
similar story. As expected, no dividend has been declared by Cogobuy or Cogo Group for twelve
years.
5. Suspicious Share Repurchase with shares mostly coming from a few accounts
Share repurchase at a high share price is frequently quoted by Cogobuy as a way of returning
profit to shareholders. However, our analysis on CCASS shows that most of the share repurchased
actually come from few accounts and it is highly suspicious if these account holders have any
relationship with the controlling shareholder of Cogobuy. We suspect that the share repurchase
is just a scheme to help friendly accounts of controlling shareholder sell shares at high price.
6. Infamous U.S. Listing History of its Former Entity, Cogo Group

Majority of today Cogobuys assets come from Cogo Group, which was listed in NASDAQ through
reverse merger in 2004. The controlling shareholder has been reducing his shareholding from
72.6% to 32.4% when Cogo Groups performance is growing rapidly. We found numerous
suspicious transactions conducted by Cogo Group to funnel cash out. After several times of assets
disposal, Cogo Group is now trading at the illiquid OTCBB, at a price of lower than USD 0.1, less
than 1% of its historical high price.
7. A Share Placement that is Undersubscribed and has no Industry Investor

Cogobuy has completed a placement in 2016 September. Although with the clause of guaranteed
return and investors will only suffer loss if the controlling shareholder goes bankrupt, it was
undersubscribed with no industry investor, showing the pessimistic view of industry players on
Cogobuy.
In view of the above, we believe that Cogobuy is another fraudulent company brought to us by
UBS and we value Cogobuy at HKD 0.53 per share, implying a 95% downside.

Introduction
Cogobuy is 46.63% owned by Mr. Jeffrey Kang (Mr. Kang) as of 31 December 2016, and was
listed in 2014 July with UBS acting as sole sponsor, with an offering size of around HKD 1.38bn.
Cogobuy is an eCommerce platform for integrated circuits (IC) and other electronic components
in China. It claims itself as the largest E-commerce IC platform in China, with a Gross
Merchandise Value (GMV) of RMB 21.65 billion in 2016. Over 99% of the revenue comes from
its online sales of IC and other electronic components (i.e. direct sales model). In the direct sales
model, the e-commerce platform operators buy IC and other electronic components from the
suppliers, hold the inventory and then sell them to customers, earning a profit from the price
difference. This is a relatively new business model in the industry with only a few players such as
IC Key. A very small percentage of Cogobuys revenue comes from the marketplace model, in
which the platform facilitates third party suppliers to complete transactions with customers, but
does not hold any inventory from the suppliers. Cogobuy also provides supply-chain financing to
customers, such that they can borrow from Cogobuy in purchasing products through the platform
of Cogobuy.
Small and Medium Enterprises (SME) is the major focus of Cogobuy. SME accounts for 63.25%
of the direct sales revenue with blue-chip customers accounting for the remaining 36.75% in 2016.
The portion of sales from SME clients has been increasing steadily in recent years, and is the major
driver of Cogobuys growth according to management. Cogobuy has been claiming its
unparalleled strength in SME due to its sophisticated e-commerce platform. For example,
Cogobuys prospectus (pg. 100) stated:
"SME electronics manufacturers often lack sufficient scale to secure timely access to authentic
electronic components from brand-name suppliers, bargaining power to negotiate competitive
purchase terms and efficiently manage the procurement process. Our e-commerce platform
streamlines Chinas complex procurement system for SME electronics manufacturers, creating an
efficient channel to access reliable and high-quality branded products.".
To sum it up, the high growth rate of Cogobuy is due to its unique edge in SME, mainly driven by
its online platform that can provide superior services to SME. Cogobuy.com is the website that
operates this online platform.
Besides Cogobuy.com, IngDan is another new concept raised by Cogobuy. According to the
Company, IngDan is the largest hardware innovation platform. The function of IngDan is to create
a platform that connects various parties along the electronic manufacturing supply chain
(upstream component suppliers, legal/financial consultants, downstream distributors, etc.) to
provide one-stop solutions for IoT and hardware entrepreneurs. Management also credits IngDan
for contributing a major portion of SME customer acquisitions, leveraging its strong presence
among China's entrepreneur community1. Mr. Kang has the intention of spinning off IngDan and
list it in Mainland China next year2.

The majority of today Cogobuys asset came from Cogo Group, its former entity which was listed
in NASDAQ through reverse merger in 2004 and delisted in 2015. Cogo Group is also majority
owned by Mr. Kang and has been conducting similar business before.
Following we will investigate Cogobuy in depth and come to the conclusion that Cogobuy is just
another scam brought by UBS.
1
Source: UBS Initial Coverage on Cogobuy published on 2017 March 8
2
Source: http://kuaixun.stcn.com/2016/0428/12693551.shtml

Part 1. A Paradox: The Largest E-Commerce IC Platform with the Smallest Traffic
According to the Companys disclosure, Cogobuy.com is the largest transaction-based e-

commerce platform for IC and other electronic components in China as measured by GMV since
2013, while IngDan is the largest intelligent hardware innovation business platform in China. The
disclosed GMV for Cogobuy reached RMB 21.65 bn in 2016, of which RMB 5,185 mn comes from
IngDan. The target GMV of IngDan in 2017 is RMB10 bn, and Cogobuy aims to develop into a
RMB 100 bn e-commerce platform within several years3. The management painted Cogobuy.com
as the Jingdong Mall of electronic components and IngDan as a comprehensive electronics-
manufacturing ecosystem in the IoT era.
However, our following analysis shows that different sources of independent web statistics
completely contradict with the promising picture painted by the management. Both
Cogogroup.com and IngDan have a minimal amount of web traffic, and is ranked almost the
lowest when compared to its major competitors. Moreover, both websites are poorly designed
and Cogobuy.com has even been down for a week in April. If such a website can have billions of
GMV, then it is a legend that should be learnt by all entrepreneurs in Silicon Valley. Rather, we
believe the truth is that Cogobuy is at most a traditional offline distributor with inflated revenue,
with the aim of attracting innocent investors believing its fascinating future.
Traffic myth of Cogobuy.com and IngDan.com
In its 2014 prospectus, the Company disclosed that it has the largest market share in transaction-
based market for IC and electronic components:
Exhibit 1: GMV and market share in transaction-based market for IC and electronic components
Source: Cogobuy 2014 Prospectus, Pg 72
As the top player in the market, we expect Cogobuy to have a very high web traffics. Of course,
since Made-in-China.com, Global Sources and Alibaba sell other general products, a direct
comparison between them and Cogobuy is not appropriate. But Hqew.com, ranked number five
above, mostly sells electronic products and therefore we would expect the web traffics of Cogobuy,
as the top player in the market, to be around ten times more than that of Hqew.com as implied
by the GMV. However, the truth is just the opposite. Below are the estimated web traffic data from

two leading online competitive intelligence providers, Alexa and SimilarWeb, which are publicly
available:
Exhibit 2: Web Traffic Estimation and Rankings of Cogobuy and its competitors, sorted by monthly
visits
SimilarWeb Alexa Disclosed Revenue Prospectus
Product Platform Monthly China China (RMB mn) 1 Mkt. Share
Name Type Type Visits (k) Rank Rank 2016FY 2015FY in 2013
Alibaba General Marketplace 112,000.00 110 78 5,425.00 4,718.00 6.10%
Global
General Marketplace 10,000.00 n.a. n.a. N.A. 455.80 8.80%
Sources
Made-in-
General Marketplace 779.50 n.a. 720 508.11 410.98 9.30%
China
DZSC.com Electronic Marketplace 583.10 4,427 850 N.A. N.A. N.A.
Hqew.com Electronic Marketplace 387.70 5,227 3,023 67.59 73.37 5.60%
ickey.cn Electronic Direct Sales 128.90 9,284 2,266 1,000.00 500.00 N.A.
Ic.net.cn Electronic Marketplace 56.20 16,722 5,742 N.A. N.A. N.A.
IngDan.com Other Marketplace 24.20 38,488 32,783 12,932.79 9,453.392
2
N.A.
Wlxmall.com Electronic Direct Sales 7.90 72,711 n.a. 100.003 N.A. N.A.
Cogobuy.com Electronic Direct Sales 5.40 84,465 9,085 12,932.792 9,453.392 55.10%
Source: SimilarWeb and Alexas data retrieved in May 2017. Revenue from companies public disclosure
1: Only include the revenue segment generated by the online B2B platform
2: Total revenue for Cogobuy is stated here since separate figures are unavailable
3: 2016 revenue is only target figure disclosed on official website
From the above table, we can see that Cogobuy.com estimated monthly visits is only 5.40k, and
Hqew.com estimated monthly visits is 387.70k, around 70 times larger than that of Cogobuy.com.
Other competitors which sell general products have an even higher traffic and ranking as expected.
One observation is that the ranking is also mostly consistent with the disclosed revenue for
marketplace platform and direct sales platform respectively (except IngDan.com and
Cogobuy.com). Note that the revenue for marketplace model and direct sales model cannot be
compared directly. For marketplace model, only the commission or fees generated, e.g.
transaction commission and advertising fees are recognized as revenue, while the whole GMV is
recognized as revenue for direct sales model.
By just looking at the platform that adopts a direct sales model, we can see that ickey.cn has a
much higher traffic than Cogobuy.com, but the disclosed 2016 revenue for ickey.cn is only RMB 1
billion. A more comparable website to Cogobuy.com is Wlxmall.com (which still has a higher traffic
than Cogobuy.com), with only a revenue of around RMB 100 mn. How is it possible for Cogobuy
to generate over RMB 20 billion GMV when its ranking and traffic rank almost the lowest
among its competitors?

How are traffic estimate and ranking determined?
Alexa (under Amazon) and SimiliarWeb are the two leading online competitive intelligence providers for
website traffic and ranking estimation. Both companies use a wide array of data, such as information
provided from local internet service provider, web crawlers, and users explorer to estimate the web
traffics, which then determine the ranking. You can try to verify the above ranking on their websites:
Alexa: www.alexa.com/siteinfo
SimilarWeb: www.similarweb.com
A Tour of Cogobuy.com, the most outdated E-Commerce IC Platform in China
Do not take our words for granted. A simple tour of Cogobuy.com and Ingdan.com would already
be sufficient to understand its low traffic and ranking. Let open http://cogobuy.com in the explorer
to visit the spectacular main page of the largest E-Commerce IC Platform in China:
Exhibit 3: Screenshot of http://cogobuy.com
Source: http://cogobuy.com, as of 2017 May 8
The main page seems to be not very welcoming. We tried different explorers and all shows the
same results, stating that the connection is insecure. Our IT consultant told us that the website
administrator configured the SSL certificate improperly, leading to the warning4. We are skeptical
that how can a platform with billions of GMV could have committed such a low-level mistake
without anyone fixing it for a long time.
By the time you read our report, we believe (hopefully) that Cogobuy would have already
corrected the mistake. If not, you can enter http://www.cogobuy.com in the explorer to visit the
main page without warning:

Exhibit 4: Screenshot of http://www.cogobuy.com as of 2017 May 8
Selected Product (Industry trend, newest and hottest products)
Source: http://www.cogobuy.com, as of 2017 May 8
You can see there are six selected products on the main page, which are stated as the newest and
hottest products. Now let take a look at the website three years ago when it was just listed:
Exhibit 5: Screenshot of Cogobuy.com as of 2014 Jul 7
Selected Product (Industry trend, newest and hottest products)
Source: https://web.archive.org/web/20140707043044/https://cogobuy.com/, as of 2017 May 8

Archive.org is a website that archive Internet webpages periodically and reader can go there to
visit the past snapshots of Cogobuy.com. By comparing the two screenshots, we can see that five
of the six newest and hottest products has actually been here since three years ago. There is
hardly an update on the website since its listing (except the news part which tells us how promising
the future of Cogobuy will be). Most of the selected products on the website are outdated. For
example, the first selected product, RFMD RFSA2013 was introduced in 2011 June5 (If you click
into its product page and then the qualification report, you will only be redirected to the
manufacturer website. There are plenty of other similar bugs in the website). The last selected
product, Littlefuse 87063-022s whole series is even obsolete and production has already been
discontinued6. We highly doubt how new and hot these products are.
(If the Company has already update the section by the time you read this report, you can still visit
the following link to see the archived webpage of it as of 2017 May 9:
https://web.archive.org/web/20170509101933/https://cogobuy.com/)
The Company may argue that it only forgets to update the section. Therefore, we picked one
supplier, SanDisk, which was listed on both the prospectus (pg.4) and the main page, to see if its
newest products are available on the website. If you click the SanDisk image on the main page,
you would be directed to the following webpage:
Exhibit 6: Screenshot of Cogobuys SanDisk Section
We provide the following product:

iNAND Embedded Flash Drive, SSD, memory and PC
Card
Source: http://www.cogobuy.com/brand/1-71.html, as of 2017 May 8
Since iNAND Embedded Flash Disk is listed as the first product here, we would try to see if the
newest product in the series can be found on Cogobuy.com and compared the result to its
competitor. iNAND is manufactured by SanDisk and it has six major series, which are 3120, 5130,
7030, 7232, 7250 and 7350. You can visit SanDisk official website for further details. Under each
series, there are different products with different specification, such as memory size. Each product
is associated with a product number that uniquely identifies the product, which can be used for

searching the product on online platform. For example, the latest 128GB version of iNAND 7232s
product number is SDINADF4-128G-L/H. We tried to search the iNAND products on Cogobuy and
other IC platforms by product number, with the following results:
Exhibit 7: iNAND brands availability on Cogobuy.com and other IC platforms

iNAND iNAND iNAND iNAND iNAND iNAND
Series
3120 5130 7030 7232 7250 7350
Major product
SDIN8DR1 SDIN9DS2 SDIN9DW4 SDINADF4 SDINBDG4 SDINBDD4
number prefix
Launch Date 2011 Feb 2011 Feb 2012 Jun 2015 July 2015 Oct 2017 Feb
Platform Availability on the platform (Y: Yes, N: No)
dzsc.com Y Y Y Y N N
hqew.com Y Y Y Y Y N
ickey.cn Y Y Y Y Y N
ic.net.cn Y Y Y Y N N
wlxmall.com No Sandisk Product
cogobuy.com N N N N N N
Source: Respective official websites search result, as of 2017 May 8
To our surprise, none of the series products can be found on cogobuy.com, while most other
platforms return with detailed description. For example, if you search SDIN8DR1 (i.e. iNAND 3120
series) on Cogobuy.com, you get the following result:
Exhibit 8: Screenshot of Cogobuys search result on SDIN8DR1

Sorry we cannot find products related to SDIN8DR1
Source: http://www.cogobuy.com/home/List_search?keyword=SDIN8DR1, as of 2017 May 8
On the other hand, ic.net.cn gave us the details of the product with pricing.

Exhibit 9: Screenshot of ickey.cns search result on SDIN8DR1
HK Pricing PRC Pricing
Source: http://ickey.cn, as of 2017 May 8
So what products are listed on the SanDisk section of Cogobuy.com? Actually, those are very
outdated product back to 2005. For example, the first product on the list (refer to pg.9 screenshot),
FFD-25-IDEP-10240-B, was launched back in 2005 September7.
It is surprising to see that even iNAND series is listed as the first major product and SanDisk
is listed as the major supplier of Cogobuy, none of its iNAND series product can be found
on Cogobuy.com. We tried other suppliers products and the results are similar: most
products appear on other IC platforms but not Cogobuy.com. Reader can pick a supplier
randomly and try search its newest products on Cogobuy.com, and you will get a similar
result.
Down for a week without maintenance
The most unacceptable point of Cogobuy.com is that it has been down for a week in April. If you
visit Cogobuy.com from 2017 April 18 to 2017 April 26, you will get the following result:

Exhibit 10: Screenshot of Cogobuy.com on 2017 April 26
Source: http://www.cogobuy.com, as of 2017 April 26
Our IT consultant told us that the reason for the above display is not because the server was not
functioning properly, but because the linkage to the format file (a CSS file) is broken, and therefore
all webpage formatting is lost. The error can be easily fixed by placing back the CSS file to the
correct location. If Cogobuy.com is really having the claimed GMV of RMB 21.65 billion, then
such a careless mistake would cost Cogobuy around RMB 400 million of GMV. We hope the
management to explain fully the details of this incident.
There are countless other bugs (e.g. invalid link, improper security setting) in Cogobuy.com and
we would not explain in details here. These low-level errors can be easily fixed by an IT professional
with basic understanding of website development. We are astonished to see a platform without
even a proper website administrator can have billions of GMV.
As the management points out, Cogobuy.com, as a one-stop platform, allows SME to

purchase products online easily and is the main driver of the rapid growth of Cogobuy.com
in recent years. We serious doubts how a SME can find the products it need in such a poorly-
designed, outdated and unstable platform. We believe that most, if not all, of the claimed
GMV on Cogobuy.com does not exist. We believe the rapid growth of Cogobuy is
unsupported by its fundamental and is mostly fake.

A Tour of IngDan.com, the largest fraud innovation business platform in China
According to 2016 Annual Report, IngDan.com is the largest intelligent hardware innovation
business platform in China, and contributed GMV of RMB5,185mn in 2016. By the year end of
2016, IngDan.com has registered more than 20,000 intelligent hardware projects and over 20.0
million followers.
At of 2016 May 16, the Company announced that the number of IoT projects on IngDan.com
reached nearly 13,000. Therefore, within seven and a half months, the number of IoT projects on
IngDan.com has increased by 7,000, at a rate of around 930 projects per month.
Let visit IngDan to see if the claimed project rate and the GMV is reliable. IngDan has several
subdomains for different functions and languages:
Exhibit 11: List of IngDans subdomains

Subdomain URL Language Function
Provide (i) crowdtesting and (ii) crowdfunding
http://www.ingdan.com/ Simplified
service, and also list the major activities held by
?language=zh Chinese
IngDan
Traditional
http://hk.ingdan.com/ Mainly providing information of IngDan Concept
Chinese
http://en.ingdan.com/ English Mainly providing information of IngDan Concept
Provide (i) IngDan Link, i.e. supplier matching
http://biz.ingdan.com/ Simplified
service and (ii) IoT Supermarket, allowing
(IngDan Supply Chain) Chinese
entrepreneurs to purchase electronic products online
http://mall.ingdan.com/ Simplified
Allow consumers to purchase IoT products online
(IngDan Mall) Chinese
The subdomains may be somehow confusing. For example, you may think that the first three
subdomains are just the same webpage with different languages, but actually the content of all
three websites do not correspond to each other. If you enter http://www.ingdan.com/ in your
explorer, you will be directed to one of the first three subdomains.
From the table above, we can see that IngDan provides a comprehensive ecosystem to
entrepreneurs. The main page (Simplified Chinese version) provides crowdtesting and
crowdfunding service. IngDan Supply Chain allows innovators to connect to supplier and is often
claimed by the management as the competitive edge of IngDan compared to other platforms.
IngDan Mall allows entrepreneurs to sell their products to public. Following we will investigate
each function one-by-one.
As we expect Cogobuys management will rush to update the section mentioned in this report
very soon, we have already archived all the relevant webpages on 2017 May 9. You can visit the
archived version of the website from https://web.archive.org, if the website has already been
updated.

IngDans Crowdtesting and Crowdfunding: Three Projects for the Whole April
If you visit the simplified Chinese version of IngDan main page, you will find the list of
crowdtesting and crowdfunding project:
Exhibit 12: IngDan main page (Simplified Chinese version)
Crowdtesting
Number: 18
Application Number: 74
Crowdtesting Test Report: 0
Number: 5
Test Report: 0
Crowdfunding
Crowdtesting
Number: 5
Test Report: 5
Source: http://www.ingdan.com/?language=zh as of 2017 May 8
We observe that there are only three crowdtesting / crowdfunding projects (the second and third
one is actually the same project, one for crowdtesting and another one for crowdfunding) in 2017
April, with a minimal amount of traffic. How can a platform with 930 new projects per month
only have three crowdtesting and crowdfunding project for a whole month? This stands as
a stark contrast with other innovating platforms such as JD Finance (https://z.jd.com) in
China.
Moreover, if you visit the event section (http://hk.ingdan.com/events) here, you will find only one
event in 2016 and 2017, with all others event from 2015. Cogobuy seems to have a habit of not
updating websites.

The management may argue that most projects do not need crowdtesting or crowdfunding
service, and only supply chain matching service is provided. Following we will investigate IngDan
Supply Chain, the core of IngDan.com, with an even more astonishing result.
IngDan Supply Chain: Matching Requests for an internal Mainland Chinas Employee
IngDan Supply Chain has two major functions. One is linking entrepreneurs with suppliers (i.e.
IngDan Link) and second one is IoT Supermarket, allowing entrepreneurs to purchase the
electronic components directly.
In IngDan Link, entrepreneurs can submit their requests for suppliers online, and the details of
each supply chain request can be found on the website:
Exhibit 13: Screenshot of IngDan Links request
Protective casing for tracheal tube that has the function of removing dust, filtering,
moisturization, local warming and heat insulation function. Achieved the requirements of
tracheal surgery after tracheotomy. Prototype is ready and needs manufacturing in scale
Recommended
Supplier
Two-body structured remote control boat, with the size of about 60cm long, 45cm wide and
20cm height
Recommended
Supplier
A design of nail clippers that prevent nail from flying around when clipping
Recommended
Supplier
Source: http://biz.ingdan.com/link/anli/8, as of 2017 May 8
However, most of the requests on the webpage seems to be without commercial substance. For
example, from the above screenshot, you can see the user goodoyo submitted for two strange
requests within just an hour (Actually the user goodoyo has other strange requests which can be
found in appendix A). There are many similar users with repeating requests.

Most importantly, the distribution of the request across time is highly suspicious. There is almost
no request on weekend or Chinese holiday (E.g. no requests on April 2 and April 3, which is
Mainland Chinas holiday for Qingming Festival, but Hong Kong has no holiday on April 3). The
management may argue that all entrepreneurs are having rest on Mainland Chinas holiday.
However, on April 28, a working Friday, there is completely no request as well. Is it possible that
the Mainland China employee responsible for posting these requests took a day off or forgot to
post request on that day?
Since the supplier company names are provided in each request, we tried to contact some of the
suppliers provided to these entrepreneurs, and all suppliers told us that they are not aware of
having received any product request from IngDan platform.
As we expect the Company will delete these dubious requests soon, we have already attached the
full list of request in 2017 April in the appendix. It is highly dubious that if there are any real
innovations behind these messy and weird requests. We are highly skeptical how these
requests can generate RMB 5,185 mn GMV for IngDan in 2016.
Even if we treat these dubious request as IoT project, we counted that there are total of
117 projects in 2017 April, still far short of the 930 projects monthly rate as implied by
Companys disclosure. Most importantly, the possibility of arranging a Mainland China
employee creating fake request on its own platform leads us to question the integrity of
Cogobuy.
Moreover, if you visit Link Experience Section that allows user to experience, you will find only
one user sharing its experience in 2016 July for the whole year of 2016, and completely no sharing
in 2017:

Exhibit 14: Screenshot of IngDan Link Experience
Thank you IngDan and all
2016-07-04 23:30:55
Thank you IngDan
2016-07-04 23:25:10
Never thought our creativity can lead to a
manufactured product
2015-11-13 10:44:30
Source: http://biz.ingdan.com/experience, as of 2017 May 8
Following, let us visit the second function of supply chain solution to entrepreneurs, IoT
Supermarket, allowing entrepreneurs to purchase chips directly on its platform. We registered an
account and clicked the purchase button for a randomly-selected product with the following result:
Exhibit 15: Screenshot of purchasing from IngDan IoT Supermarket
Please contact customer support to

purchase:
400 883 0393 ext 1
(Monday to Friday 0900-1800)
Source: http://biz.ingdan.com/iot/detail-346.html, as of 2017 May 8

Although Cogobuy has been emphasizing O2O for many years, it seems the process of switching
from online to offline is too fast than expected. We tried other different products, all asking us to
call the customer support. The IoT Supermarket seems nothing more than an online catalog of
product. But still, it is better than IngDan Mall, which has all products sold out every day.
IngDan Mall: All products sold or 404 Error
If you visit IngDan Mall, you can find a wide variety of IoT prdoucts:
Exhibit 16: IngDan Mall Page
#1 #2
#3 #4
Source: http://mall.ingdan.com, as of 2017 May 8
However, if you click into the product, you will find that either it was all sold or having a 404 error.
Exhibit 17: Screenshot of IngDan Mall #1 product
Sales: 96 Inventory: 0
All Sold
Source: http://mall.ingdan.com/item-404.html, as of 2017 May 8

The #1, #2 and #4 products are all sold, which has been the same for whole April. Moreover, the
#3 product would lead you to a 404 error page.
Exhibit 18: Screenshot of IngDan Mall #3 product
Your visiting webpage is not found or has already

been removed. You can go back to main page
Source: http://mall.ingdan.com/item-239.html, as of 2017 May 8
We tried other products all with similar results, stating that the products are all sold or leading to
a 404 error page. How would anyone purchase any products from IngDan Mall, and how would it
be possible to help entrepreneurs sell its products?
From the above analysis, we can see that all parts of IngDan ecosystem, from supply chain and
crowdfunding to sales, have almost no commercial substance at all. A savvy investor may find
similarity between IngDan and Cogo 3.0, a grand concept proposed by Mr. Kang back in 2011
to stop share price from falling (but unsuccessful) when it was still listed in NASDAQ. Cogo 3.0
has been fiercely questioned and criticized by U.S. investors, and has no longer been mentioned
by Mr. Kang anymore.
Now Mr. Kang is repeating his gimmick again, even with the plan of spinning off IngDan
and listing it in Mainland China next year8. We do not think that CSRC will allow such a scam
to repeat in Mainland China. We believe IngDan is nothing more than a bubble poorly
orchestrated by Cogobuy to attract innocent investors and to push up share price. We
believe that most, if not all, of the RMB5,185 mn claimed GMV on IngDan does not exist at
all.
3
Source: Guo Jingjing, Vice President of Cogobuy Group,
http://www.zhitongcaijing.com/content/detail/53545.html
4
The technical reason is as follow: the SSL certificate is only granted to *.cogobuy.com and the website
administrator made a low-level mistake of omitting cogobuy.com in the certificate domain, leading to the
warning
5
Source: http://www.semiconductor-today.com/news_items/2011/JUNE/RFMD_060611.html
6
Source: http://www.littelfuse.com/products/varistors/discontinued/za-hirel.aspx
7
Source: http://datasheet.octopart.com/FFD-25-IDEP-10240-B-M-Systems-datasheet-4668.pdf
8
Source: http://kuaixun.stcn.com/2016/0428/12693551.shtml

Part 2. Significant Discrepancy in SAIC filings
Similar to many other frauds of Chinese listed companies, we found that there is a significant
deviation between the revenue figures reported by Cogobuy and its SAIC filings. Buyers would
generally require a PRCs invoice if the sales are conducted in PRC, and the invoice amount will be
recorded in the SAIC filing of Cogobuys PRC subsidiaries. Therefore, we have identified all major
PRC-incorporated subsidiaries with major business stated as sales of electronics components
from annual report and retrieved their respective SAIC filings (Please refer to Appendix C for SAIC
filings of Comtech Digital Technology (Shenzhen) Limited in 2015 as an example for your
reference). Below is the table summarizing the discrepancy between its SAIC filings and reported
figures.
Exhibit 19: Discrepancy between Cogobuys SAIC filings and reported figures
PRC subsidiaries with major business of sales Sales in 2015 Sales in 2014
of electronics components (thousand RMB) (thousand RMB)
Comtech Digital Technology (Shenzhen) Limited 99,800.9 n.a.9
Envision Communication Technology (Shenzhen)
51,059.2 93,016.6
Company Limited
Shanghai Comtech Electronic Technology 62,499.6 72,120.0
Shanghai E&T System Company Limited 17,930.0 41,933.88008
10
Qianhai Cogobuy.com (Shenzhen) Limited 154,099.1 n.a.
Cogobuy Wireless Technology (Shenzhen) Limited 11 165.6 n.a.
Total sales from SAIC filings 385,554 207,070
Revenue disclosed in annual reports 9,453,389 6,848,365
Source: Cogobuys annual reports and relevant SAIC filings
A savvy reader may point out that the majority of Cogobuys sales maybe incurred in Hong Kong,
and the buyers will transport the products back into Mainland China on their own, and therefore
the sales amount reported in SAIC filings may inevitably be much lower than the reported figures.
We tried to find the breakdown of sales in PRC and Hong Kong from Cogobuys annual reports
but to no avail. But during 2017 Xueqiu Hong Kong Stock Summit, Cogobuys Vice President Ms.
Guo Jingjing stated that more than 80% of our sales are settled in Hong Kong12. As her intention
was to show its logistics strength outside PRC, she would have no intention to understate this
figure, and we believe that the actual portion of Hong Kong sales is likely to be around 80%.
However, when we tried to adjust the SAIC figures assuming 80% of the sales are settled in Hong
Kong, there is still a 79.6% difference between adjusted SAIC filings and reported revenue in 2015.
To be conservative, if we further assume 90% of the sales are settled in Hong Kong (which is the
highest possible ratio in our opinion, since Ms. Guo Jingjing would quote more than 90% if the
actual figure is over 90%. See our analysis below for further supporting evidence), there is still a
59.2% difference between adjusted SAIC filings and reported revenue in 2015. The same analysis
applies to 2014 as well.

Exhibit 20: Difference in sales using various assumptions
Sales in 2015 Sales in 2014
(thousand RMB) (thousand RMB)
Total sales from SAIC filings 385,554 207,070
Cogobuys total sales

1,927,770 1,035,350
(assume 20% of sales are settled in China)
Difference 79.6% 84.9%
Cogobuys total sales

3,855,540 2,070,700
(assume 10% of sales are settled in China)
Difference 59.2% 69.8%
According to industry experts we consulted, blue-chip clients tend to settle their trades in Hong
Kong in order to avoid currency risk, given that they have the ability to import the products back
into China. Yet, for SMEs which do not have such capability, they prefer to settle the trades in PRC
to minimize their administrative costs. So as to verify this claim, we have obtained SAIC filings of
IC Key (Shanghai) Internet Technology Company Limited (the PRC operating company of IC Key,
previously known as Shanghai Yunhan Electronics Company Limited) and its subsidiaries. IC Key
is a close competitor of Cogobuy with a similar business model (i.e. online direct sales model)
focusing on SME. By contrasting IC Keys SAIC filings and disclosed sales figures, we noticed that
more than half of its sales are settled in the PRC, which is what supposed to be the case for an
online platform focusing on SME market.
Exhibit 21: IC Keys proportion of revenue in China

2013 2014 2015
IC Keys disclosed sales figures (RMB million) 57 173 500
IC Keys SAIC reported sales figures (RMB million) 57 14413 32814
Proportion of Sales in PRC 100% 83% 66%
Source: IC Keys website and relevant SAIC filings
Given that Cogobuy claimed to have generated more than half of their revenue from SME clients
recently (see table below), we would expect Cogobuys client to choose place of settlement in a
similar manner to that of IC Key and thus generate similar revenue mix between Hong Kong and
PRC. Therefore, we think it is highly abnormal that Cogobuy has more than 80% of sales settled
in Hong Kong given its claimed popularity among Chinas SME, not to mention 90%. It is possible
that those SMEs may be just related parties of Cogobuy such that they prefer to settle in Hong
Kong for the purpose of tax evasion.

Exhibit 22: Cogobuys segment revenue from 2011 to 2016
2011 2012 2013 2014 2015 2016
Blue-chip clients 38.7% 40.0% 55.9% 51.2% 40.9% 36.75%
SME clients 61.3% 60.0% 44.1% 48.8% 59.1% 63.25%
Source: Cogobuys prospectus and annual reports
In view of the above, we think that Cogobuys revenue distribution is highly suspicious.
Even if we were to believe that 90% of Cogobuys revenue is from Hong Kong, there would
still be a near 60% difference with the reported figures on SAIC filings. We strongly believe
that the majority of Cogobuys revenue does not exist and Cogobuy is just a scam like other
Chinese companies fraud in the past.
SAIC Tax far lower than Annual Report Disclosure
Since the revenue for Cogobuy is highly inflated, we expect its net income is highly inflated as
well. Tax figures from SAIC filings further corroborates with our analysis above. In 2015 Annual
Report, the Company disclosed that its 2015 income tax expense is RMB 56.89mn. Of the RMB
56.89mn, RMB 22.98mn comes from PRC Corporation Income Tax:
Exhibit 23: 2015 Cogobuys Accountant Report Notes on Income Tax
Source: Cogobuys 2015 annual report, pg. 79
According to government policy, all China companies have to file the amount of total tax to
SAIC annually. This total tax refers to the amount of tax that is payable to government for that
reporting year. It includes all kinds of tax, such as Value-Added Tax (VAT), business tax and income
tax. It should be noted that it does not mean the actual tax you have paid in cash during that year.
For example, if a Chinese company earned RMB 10 mn in 2015 and has to pay RMB 2.5 mn income
tax in early 2016, this RMB 2.5 mn income tax will be included in the total tax in 2015 SAIC filing.
Since other taxes are also included in the calculation, this total tax amount should be much
larger than annual report disclosure. However, our finding tells us the opposite. Below is the table
of the total tax amount disclosed in 2015 SAIC filings for all Cogobuys major subsidiaries with
major business stated as sales of electronics components:

Exhibit 24: 2015 Total Tax Amount filed by Cogobuy major subsidiaries in SAIC
2015 Total Tax in SAIC
Subsidiary Name
(RMB '000)
Comtech Digital Technology (Shenzhen) Limited 6,792.60
Envision Communication Technology (Shenzhen) Limited 868.30
Shanghai Comtech Electronic Technology 1,640.10
Shanghai E&T System Company Limited 210.00
Qianhai Cogobuy.com (Shenzhen) Limited 25.20
Cogobuy Wireless Technology (Shenzhen) Limited 0.00
Total Tax for all major PRC Subsidiaries 9,536.20
Disclosed PRC Income Tax in Annual Report 22,984.00
Difference (%) 58.5%
Source: SAIC filings, 2015 annual report
Even if we assume Cogobuy does not need to pay any VAT, we still find that the reported PRC
income tax on annual report is 2.4 times of the figures in SAIC filings. To accurately estimate the
actual inflation, we have to first estimate the amount of VAT paid by Cogobuy in 2015:
Exhibit 25: 2015 PRC VAT Estimation (All figures in RMB '000 except %)
Disclosed
SAIC Est. Gross Est.
Subsidiary VAT Rate
Revenue Profit VAT
(%)
Comtech Digital Technology
6.00% 99,800.90 8,073.60 515.34
(Shenzhen) Limited
Envision Communication Technology
3.00% 51,059.20 4,130.54 127.75
(Shenzhen) Limited
Shanghai Comtech Electronic
17.00% 62,499.60 5,056.03 1,035.57
Technology
Shanghai E&T System Company
17.00% 17,930.00 1,450.48 297.09
Limited
Qianhai Cogobuy.com (Shenzhen)
3.00% 154,099.10 12,466.16 385.55
Limited
Cogobuy Wireless Technology
3.00%1 165.60 13.40 0.41
(Shenzhen) Limited
Total 385,554.40 31,190.20 2,361.71
Source: SAIC filings, disclosed VAT Rate from prospectus
Note 1: The VAT rate of Cogobuy Wireless Technology (Shenzhen) Limited is not disclosed, and we assumed
the minimum 3.00% VAT rate to be conservative
Note 2: We estimate the gross profit by applying Cogobuy overall 2015 gross margin (8.09%) to each
subsidiarys revenue. Then we estimate VAT by using the formula: (Gross Profit * VAT Rate) / (1 VAR Rate),
since COGS is VAT deductible and reported sales is post-VAT figure
Therefore, the total estimated 2015 VAT is around RMB 2.36 mn. By deducting the VAT, we can
calculate the PRC income tax inflation rate of Cogobuy:

Exhibit 26: 2015 PRC Income Tax Inflation Estimation (RMB 000)
Total Tax in SAIC filing 9,536.20
Estimated VAT 2,361.71
Estimated Income Tax (Total Tax in SAIC filing -
7,174.49
Estimated VAT)
Disclosed PRC Income Tax in Annual Report 22,984.00
Difference (%) 68.8%
By taking VAT into account, we can see 68.8% of the reported PRC income tax does not
exist. However, we still have not taken accounts of other taxes such as urban maintenance
and construction, education surtax etc. If we further take these taxes into accounts, the
difference % will likely be larger than 70%, further corroborating with the revenue
difference 60-80% calculated in previous section.
9
Comtech Digital Technology (Shenzhen) Limited did not report its financials in 2014 in the SAIC filing
system
10
Qianhai Cogobuy.com (Shenzhen) Limited is only disclosed as a PRC subsidiary with principal activities
of sales of electronics components in 2015 annual report, but not 2014 annual report
11
Cogobuy Wireless Technology (Shenzhen) Limited is only disclosed as a PRC subsidiary with principal
activities of sales of electronics components in 2015 annual report, but not 2014 annual report
12
Source: https://xueqiu.com/event/xueqiu-hksforum2017?live=1
13
Consist of RMB 129 million of sales from Shanghai Yunhan Electronics Company Limited (the major PRC
operating subsidiary of IC Key) and RMB 15 million of sales from Shanghai Shouxin Electronics
Technology Company Limited (subsidiary of Shanghai Yunhan Electronics Company Limited)
14
Consist of RMB 289 million of sales from Shanghai Yunhan Electronics Company Limited (the major PRC
operating subsidiary of IC Key), RMB 37 million of sales from Shanghai Shouxin Electronics Technology
Company Limited (subsidiary of Shanghai Yunhan Electronics Company Limited) and RMB 2 million of
sales from Shenzhen Hanyun Electronics Company Limited (subsidiary of Shanghai Yunhan Electronics
Company Limited)

Part 3. Unparalleled financial performance of Cogobuy
To further confirm our understanding, we tried to compare Cogobuys performance against its
peers in order to see if its performance is in line with other competitors in the market. We noticed
that UBS, the sole sponsor in Cogobuys IPO back in 2014, initiated coverage on Cogobuy with a
buy rating on 2017 Mar 8. To be fair, we will use the same companies listed in the comparables
on UBSs report (see below table) and compare Cogobuys financial performance with them.
Exhibit 27: List of comparable companies
Source: UBS Research Report, published on 2017 Mar 8
Among the list, IC distributor peers are the most comparable to Cogobuy (Can Cogobuy be
compared to Alibaba? We highly doubt it.), and we will therefore compare Cogobuys
performance with the IC distributor peers. We compared their financial ratios and discovered that
Cogobuy is much of an outlier compared to its peers. For example, Cogobuy has an unparalleled
return on equity (ROE) (see the chart below) for years:

Exhibit 28: Return of Equity (ROE) of Cogobuy and its peers
25.0%
21.5%
20.2%
20.0% 17.9%
15.0%
10.0%
5.0%
2014 2015 2016
Cogobuy Group Avnet Inc WPG Holdings Arrow Electronics WT Microelectronics
Source: Respective Annual Reports
Apart from its extraordinarily high ROE, we also spot that the revenue and net income growth rate
of Cogobuy are both significantly higher than its IC distributor peers (see the charts below).
According to Ms. Guo Jingjing in 2017 Xueqiu Hong Kong Stock Summit, Cogobuys number of
new customers, GMV and non-GAAP net profit will grow by 80%, 50% and 30% respectively in
201715, continuing its spectacular growth rate which is too good to be true.
Exhibit 29: Revenue Growth Rate of Cogobuy and its peers
183.3%
200.0%
150.0%
100.0%
38.0% 36.8%
50.0%
0.0%
2014 2015 2016
-50.0%

Exhibit 30: Net Income attributable to equity shareholders of the Company
Growth Rate of Cogobuy and its peers
136.4%
150.0%
100.0% 76.6%
39.6%
50.0%
0.0%
2014 2015 2016
-50.0%
We note that some investors argue in online forums that Cogobuys gross profit margin and net
profit margin are not extraordinary high compared to its peers, showing that Cogobuys profit
may not be fake. This is inaccurate in the sense that Cogobuys revenue is highly inflated, therefore
maintaining a similar profit margin to its peers already imply inflation in profit, rendering
comparison between profit margins meaningless.
Regarding its unbelievable growth of revenue and net income, the Company always attributes it
to the development of its online platform and IngDan. For example, the Company quoted the
development of the growth of sales of IC and other electronic components driven by the one-
step services (Does the management mean one-stop services instead?) from the online platform
as the reason for the increase in revenue in its latest 2016 annual report. As we have presented
the reality of its online platform to you in previous section, these explanations do not add up at
all.

Exhibit 31: Reasons explained by management for high growth rate
Revenue Net Profit
The increase was primarily due to the
development of the growth of sales of
The increase of profit was primarily due
2016 IC and other electronic components
to increase of revenue.
driven by the one-step services from
the online platform.
The increase was primarily due to an
The increase was primarily due to the
increase in direct sales revenue and an
2015 strong growth in product sales especially
increase in sales through our
in sales to new SME customers.
marketplace platform.
The increase in our revenue was primarily
The increase was primarily due to an
due to organic growth in the sales
increase in direct sales revenue and an
2014 volume driven by our online platform
increase in sales through our
and the increase in number of
marketplace platform.
transactional customers.
Source: Cogobuys annual reports
As we have shown that the so-call online platform is almost the worst online platform we
have ever seen, it is impossible that the online platform can bring any growth at all. We
believe that the rapid growth of Cogobuy is a complete fraud.
15
Source: https://xueqiu.com/event/xueqiu-hksforum2017?live=1

Part 4. RMB 1.9 billion of Disappeared Cash
In order to examine the quality of earnings of Cogobuy, let compare its net income and net
operating cash flows. Net income and net operating cash flows should match for a healthy
company. If a companys net operating cash flow is consistently smaller than its net income, then
it is a clear red flag. Similar to other fraud companies, Cogobuy has recorded a negative net cash
flow from operations frequently despite its rapidly increasing net profit:
Exhibit 32: Cogobuy Net Income and Net Cash Flow from Operations difference (RMB 000)
Difference
between Net
Net Cash Flow Adjusted Net Income and
Net Income from Cash Flow from Adjusted Net
Operations Operations 1 Cash Flow
from
Operations
2016 509,607 -569,525 -467,946 977,553
2015 366,481 349,671 -120,472 486,953
2014 209,970 231,868 78,539 131,431
2013 86,565 -26,269 15,748 70,817
2012 33,813 -406,369 -72,442 106,255
2011 26,824 -56,335 -99,101 125,925
Total 1,233,260 -476,959 -665,674 1,898,934
Source: Cogobuys annual reports and prospectus
Note 1: We have excluded the effect from change in amount due from or to related party as it does not
relate to operation. We have also excluded the effect from change in bank loans used for supply chain
financing business and loans to third parties, since the cash from bank loan used for supply chain financing
business has been increasing rapidly but normally bank loan should be considered as financing cash flow
instead. To be consistent, we have also excluded the effect from corresponding loans to third parties for
supply chain financing business
We can see from above that only two out of six years Cogobuy recorded a positive adjusted
net cash flow from operation (2013 and 2014 when it was just listed), and the adjusted net
cash flow from operation is still far lower than the net income for these two years.
Cogobuys total net income from 2011 to 2016 is RMB 1.23 bn, but its adjusted net cash
flow from operations is negative RMB 0.67 bn. Where did the difference of RMB 1.90 bn
go? Here is the answer: 1. Trade and other receivables, and 2. Inventories:

Exhibit 33: Reconciliation of Cogobuys Net Income and Adjusted Net Cash Flow from Operations
from 2011 to 2016 (RMB 000)
Adjustment Amount
Increase in trade and other receivables 2,058,158
Increase in inventories 1,278,686
Interest income 80,181
Net realized gains on trading securities 39,509
Reclassification from equity on disposal of available-for-sale investments 23,630
Dividend income 2,181
Share of profits of an associate 2,014
Loss on sale of property, plant and equipment 936
Gain on disposal of subsidiaries 739
Amortization of lease prepayments -293
Depreciation of property, plant and equipment -13,941
Reclassification from equity on impairment of available-for-sale investments -23,917
Impairment loss of available-for-sale investments -37,144
Amortization of intangible assets -41,667
Write down of inventories -58,879
Income tax expense over paid -72,339
Impairment loss on trade receivables -82,608
Equity-settled share-based compensation expenses -103,834
Finance costs -147,902
Increase in trade and other payables -1,004,576
Total difference 1,898,934
Source: Cogobuys annual reports and prospectus
Trade and other receivables increase accounts for RMB 2.06 bn of the missing cash, while
inventories accounts for RMB 1.28 bn of the missing cash. Moreover, the growth rate of
trade and other receivables, and inventory are often much higher than the growth rate of
revenue and net income:
Exhibit 34: Growth rate of sales, net income, trade and other receivables and inventory of Cogobuy
2013 2014 2015 2016
Sales growth rate n.a. 183.3% 38.0% 36.8%
Net Income growth rate n.a. 142.6% 74.5% 39.1%
Trade and other receivables

656,766 748,507 1,430,191 2,095,591
(RMB 000)
% increase n.a. 14.0% 91.1% 46.5%
Inventory (RMB 000) 243,800 501,340 609,172 1,394,835

% increase n.a. 105.6% 21.5% 129.0%
Source: Cogobuys annual reports

Why can Cogobuy trade and other receivables grow so fast? Who are the borrowers of these trade
and other receivables? Are these receivables coming from related parties sales that do not
want to inject cash back to the company? We hope the management to disclose the details,
including the breakdown by borrowers of the huge account receivable it has accumulated, and
the relationship of these borrowers with Mr. Kang.
Same Story for Cogo Group: RMB 990 mn of disappeared cash
We conducted similar analysis on Cogo Group, the former entity of Cogobuy listed in U.S. (for the
full story of Cogo Group, please refer to Part 6. The Infamous History of Cogo Group in U.S.) and
found a shockingly similar trend throughout all the years:
Exhibit 35: Cogo Group Net Income Free Cash Flows difference (RMB 000)
Difference
between Free
Net Cash Flow
Free Cash Cash Flow and
Net Income from Operating
Flow1 Net Cash Flow
Activities
from Operating
Activities
2011 -149,219 -147,126 -297,580 148,361
2010 113,055 -22,258 -94,434 207,489
2009 83,169 -33,510 -125,154 208,323
2008 97,162 97,462 48,578 48,584
2007 155,508 46,415 -45,456 200,964
2006 128,820 202,838 209,941 -81,121
2005 90,819 -35,074 -40,540 131,359
2004 64,335 -60,339 -61,934 126,269
Total 583,649 48,408 -406,579 990,228
Source: Cogo Groups Annual Reports
Note 1: Free cash flow is calculated by deducting payments for acquisitions of subsidiaries, net proceeds
from disposal of subsidiary, capital expenditure from net cash flow from operating activities (i.e. cash flows
from investing activities except increase in pledged bank deposits)
We used free cash flow here to more accurately reflect the tricks used by Mr. Kang. Since rule on
acquisition is much less strict in U.S., Mr. Kang has been using suspicious acquisitions of
subsidiaries as the major way of explaining the missing cash (for the full story of Cogo Groups
suspicious acquisition, please refer to Part 6. The Infamous History of Cogo Group in U.S.).
Therefore, we deducted the payments for acquisition of subsidiaries in the calculation of free cash
flow. Fortunately, Mr. Kang has not used this trick in Cogobuy (for now), may be due to the
rigorous policy of Hong Kongs Listing Rule on connected transaction.
The difference between the net income and free cash flow of Cogo Group is RMB 990.23
mn over the 8 years of listing in U.S. Except 2006, the year that it attracted innocent
investors in subscribing its new stock, the free cash flow has been much smaller than the

reported net income and is negative 6 out of 8 years, while the net income is positive 7 out
of 8 years.
Again, let see where the RMB 990.23 mn missing cash went:
Exhibit 36: Reconciliation of Cogo Groups Net Income and Free Cash Flow from 2004 to 2011 (RMB
000)
Adjustment Amount
Accounts receivable, net 934,934
Payments for acquisitions of subsidiaries, net of cash
432,700
acquired
Inventories 326,117
Prepaid expenses and other receivables 72,463
Purchases of property and equipment 49,052
Net gain on settlement relating to the acquisition of Long
43,676
Rise before goodwill impairment
Bills receivable 27,083
Deferred income taxes 25,835
Extraordinary item 6,737
Gain on disposal of a subsidiary 6,673
Income taxes receivable 2,111
Amount due to a related party 1,408
(Increase)/decrease in other assets 561
Investment in an affiliated company 421
Proceeds from disposal of property and equipment -5
Accrued expenses and other liabilities -468
Loss on disposal of property and equipment -1,053
In-process research and development -4,390
Income taxes payable -12,168
Net proceeds from disposal of a subsidiary -27,742
Depreciation expense -36,270
Provision for doubtful accounts -38,319
Accounts payable -79,416
Amortization of intangible assets -121,774
Impairment loss of goodwill -292,126
Share-based compensation -325,812
Total difference 990,228
Source: Cogo Groups Annual Reports
Again, accounts receivable and inventories rank high on the list. Account receivable and
inventories accounts for RMB 934.93 mn and RMB 326.12 mn of decreased cash respectively. As
stated above, Cogo Group has been conducting numerous suspicious acquisitions that also
accounts for RMB 432.70 mn of the decreased cash. Similarly, the growth rate of account
receivables and inventory of Cogo Group is often higher than the sales and net income growth:

Exhibit 37: Growth rate of total revenue, net income, account receivable and inventories of Cogo Group
2004 2005 2006 2007 2008 2009 2010 2011
Total Revenue
625,656 866,332 1,323,563 1,666,508 1,959,540 2,096,216 2,589,518 3,554,401
(RMB '000)
% increase n.a. 38.5% 52.8% 25.9% 17.6% 7.0% 23.5% 37.3%
Net Income
64,335 90,819 128,820 155,508 97,162 83,169 113,055 -149,219
(RMB '000)
% increase n.a. 41.2% 41.8% 20.7% -37.5% -14.4% 35.9% -232.0%
Account
Receivable 168,989 267,543 278,589 418,329 497,992 617,613 681,911 941,798
(RMB '000)
% increase n.a. 58.3% 4.1% 50.2% 19.0% 24.0% 10.4% 38.1%
Inventories
15,903 110,763 71,959 129,892 95,855 146,132 250,573 327,482
(RMB '000)
% increase n.a. 596.5% -35.0% 80.5% -26.2% 52.5% 71.5% 30.7%
Source: Cogo Groups annual reports
Similar to the situation of Cogobuy now, we see a rapidly increasing inventory and account
receivables, which are very obvious starting from 2008. For example, inventory increased for 52.5%
and 71.5% in 2009 and 2010 respectively, which are significantly higher than the growth rate of
sales and net income in the same period. We can conclude that the use of account receivable
and inventories to explain missing cash is a consistent trick used by Mr. Kang.
Consecutive Twelve years of Zero Dividend Record
Zero dividend has been Mr. Kangs dividend policy for twelve years already. Cogobuy has not
distributed any dividend since it was listed in Hong Kong albeit its spectacular growth. As expected,
Cogo Group has also not declared any dividend since its reverse takeover in 2004.
If you are fortunate enough to have purchased Cogo Groups share in 2004, you will end up
with a worthless paper of the share of its OTC stock for supporting Mr. Kang for more than
10 years and find Mr. Kang repeating the same trick in another place. You should expect
the same if you have invested in Cogobuy now.
Given the abnormal profit, rapid growth rate, huge difference between cash flow and net income,
and the consistent zero dividend policy, we strongly doubt the genuineness of Cogobuys net profit.
Of course, for the zero dividend policy, Cogobuy management will argue that they have been
actively doing share repurchase instead, citing the attractive share price of the Company as always.
But we found out that the repurchase program is likely a way of stock price manipulation and
funneling the Companys money back to Mr. Kang himself. Following we will investigate its share
repurchase program.

Part 5. Mysterious Share Repurchase: Two-third of the largest share repurchased come
from two accounts
Skeptical reader may point out that Mr. Kang has not reduced his shareholding since IPO, and
Cogobuy has been actively doing share repurchase (which is also the reason Cogobuy used for
not distributing dividend for years) and therefore Cogobuy may not be a fraud. However, our
following analysis show that shares for these share repurchase mainly come from a few accounts,
and the repurchase brought enormous profit to these account holders.
The share price of Cogobuy has been very impressive since its IPO. Its IPO price in 2014 July is
HKD 4.00 but now the share price has already surged over HKD10.0:
Exhibit 38: Share Price of Cogobuy since IPO

Price (HKD) Turnover (mn)
18 500.0
16
14 400.0
12
300.0
10
8
200.0
6
4 100.0
2
0 0.0
18/02/2016
18/08/2016
18/07/2014
18/08/2014
18/09/2014
18/10/2014
18/11/2014
18/12/2014
18/01/2015
18/02/2015
18/03/2015
18/04/2015
18/05/2015
18/06/2015
18/07/2015
18/08/2015
18/09/2015
18/10/2015
18/11/2015
18/12/2015
18/01/2016
18/03/2016
18/04/2016
18/05/2016
18/06/2016
18/07/2016
18/09/2016
18/10/2016
18/11/2016
18/12/2016
18/01/2017
18/02/2017
18/03/2017
18/04/2017
Turnover (Right Axis) Closing Price (Left Axis)
Source: HKEx
To understand the story behind the share price and share repurchase, we have to rely on data
from Central Clearing and Settlement System (CCASS), the depository system for Hong Kong listed
shares. Share has to be deposited in CCASS in order to settle trades on the exchange, and the
holding held by each broker and custodian under CCASS on each settlement day is publicly
available, which can be found on HKEx or other websites such as Webb-site.com. However, it
should be noted that CCASS can only show the broker or custodians holding, but not the client
of the broker or custodian who owns the share. But still, we can sometimes detect some unusual
activities of a stock such as high concentration by looking at the CCASS holdings. Now let have a
look at the CCASS movement of Cogobuy.
On its first trading date, i.e. 2014 July 18, the top five CCASS holders of Cogobuy were as follow:

Exhibit 39: Top 5 CCASS Holders on 2014 Jul 18
# Broker Holding Stake (%)
1 HSBC 60,919,000 4.43%
2 Morgan Stanley 53,581,600 3.90%
3 First Shanghai 42,396,000 3.09%
4 JPMorgan 25,913,400 1.89%
5 Haitong International 24,591,000 1.79%
Source: HKEx, Webb-site
First Shanghai is neither a bookrunner in Cogobuys IPO nor a very popular broker among retail
investors. Such a large holding implies that there is likely a major investor (let call him investor X)
in Cogobuys IPO behind the holding of First Shanghai. Investor Xs holding has not changed much
until 2016 June.
First Sales of Shares in 2016 June and July

The first sales of shares of investor X is in 2016 June and July. From CCASS, we can see that investor
Xs holding decreased significantly from 40.11 mn shares on 2016 Jun 24 to 35.42 mn shares on
2016 Jul 6, when the share price is around HKD 12.00. The estimated proceed (based on closing
price) from sales of share is HKD 57.41 mn and the estimated profit is HKD 38.62 mn. The sales
should be conducted in market since the trading volume increased significantly during that period.
Exhibit 40: Investor Xs estimated profit from 2016 Jun 24 to Jul 6

First Shanghai's Holding as of 2016 Jun 24 40,111,000
First Shanghai's Holding as of 2016 Jul 6 35,415,000
Decrease in First Shanghais Holding 4,696,000
Weighted-average Price (HKD) 12.23
Est. Proceeds from Sales of Share (HKD) 57,408,740
Cost of Share (@IPO Price HKD4.0 per share) 18,784,000
Estimated Profit (HKD) 38,624,740
Source: HKEx
Second Sales of Shares in 2016 September

On 2016 Sep 1, Cogobuy announced trading halt at 9:58am. It then announced that there will be
placing of new share at 9:30pm. Investor X, seems to be well prepared of this event, already moved
its 10 mn shares from First Shanghai to Shenwan Hongyuan Securities (SWS) before the
announcement:
Exhibit 41: CCASS holding change on 2016 Sep 1
First Shanghai SWS
Holding on 2016 Aug 30 35,286,000 1,224,000
Holding on 2016 Sep 1 25,286,000 11,371,000
Change -10,000,000 10,147,000
Source: HKEx

On the next day (2016 Sep 2), although not stated in the official announcement, Cogobuy
disclosed to media that several banks and insurance firms participated in the placement.16 Due to
the positive news, the share price raised 3.0% to HKD12.90 on next day. And almost immediately,
most of the 10mn shares transferred to SWS were sold that month:
Exhibit 42: SWSs' estimated sales of Cogobuy Share in 2016 September
Est. Number of Shares Sold Est. Accumulative Proceeds

(thousand) (HKD mn)
1,200 120
1,000 100
800 80
600 60
400 40
200 20
0 0
01/09/2016 06/09/2016 09/09/2016 14/09/2016 20/09/2016 23/09/2016 28/09/2016
-200 -20
Est .Number of Total Shares Sold / Bought (Left Axis)

Est. Accumulative Proceeds from Sales of Share (Right Axis)
Source: HKEx; Estimation based on CCASS decrease of holding

Note 1: On 2016 Sep 28, 9.30mn shares were further moved from First Shanghai to SWS and is excluded in
our calculation
Note 2: Proceeds from sales of share is estimated by number of shares sold multiplied by the closing price
of share on that day
Exhibit 43: Investor X's estimated profit in 2016 September

No. of shares sold by SWS in 2016 Sept 8,186,000
Weighted-average Price (HKD) 12.71
Est. Proceeds from Sales of Share (HKD) 104,015,720
Cost of Share (@IPO Price HKD4.0 per share) 32,744,000
Estimated Profit (HKD) 71,271,720
We can observe from above that investor X sold 8.19mn shares through SWS with an estimated
profit of HKD 71.3 mn in 2016 September after the placement news was announced.
So far, we have only showed that investor X has made a good profit (HKD 109.90 mn) on Cogobuy
stock and may be well informed of Companys news. Since both sales do not overlap with the
share repurchase of Cogobuy, we can at most say that investor X benefit indirectly from the share
repurchase before, but nothing more. Now, let see how investor X intersects directly with the
largest share repurchase of Cogobuy.

Third Sales of Shares from 2016 Oct to Dec and the Largest Share Repurchase
Cogobuy has been frequently conducting share repurchase, always stating that the share price of
Cogobuy was very attractive. Cogobuy has used a total of HKD 571.11 mn in share repurchase.
Below is the detail of Cogobuys share repurchase since its listing:
Exhibit 44: Details of Cogobuy's Share Repurchase

Purchase Price
Month # of Share Repurchased Cost (HKD) Max Min Average
Dec-14 1,955,000 7,833,000 4.10 3.90 4.01
Jan-15 15,791,000 67,760,000 4.43 4.08 4.29
Feb-15 7,899,000 32,603,000 4.50 3.95 4.13
Jul-15 200,000 980,000 5.00 4.83 4.90
Jan-16 3,075,000 24,824,000 8.28 7.90 8.07
Feb-16 1,437,000 11,650,000 8.30 7.92 8.11
May-16 5,416,000 57,639,000 10.96 10.50 10.64
Oct-16 4,536,000 55,088,000 12.30 12.04 12.14
Nov-16 7,632,000 91,533,000 12.50 11.42 11.99
Dec-16 17,083,000 200,849,000 12.00 11.22 11.76
Jan-17 1,215,000 13,340,060 11.70 10.32 10.98
Feb-17 668,000 7,009,240 10.80 10.30 10.49
Total 66,907,000 571,108,300
Source: Cogobuy's annual reports, interim reports and announcements
Note 1: The actual cost of share repurchase in 2017 Jan and Feb is not yet announced, and
therefore we estimate the cost based on average of maximum and minimum daily purchase
price disclosed
It is suspicious that Cogobuy continue to do share repurchase even when the share price reached
HKD 12 instead of distributing dividend directly. Once Cogobuy completed its placement in 2016
September with a net proceeds of HKD 2,000 mn, it already started its share repurchase program
again at a purchase price as high as HKD 12.50 per share (The placement price is also HKD 12.50.
Why Cogobuy repurchase share at HKD 12.50 just after doing a placement at HKD 12.50 per
share?). The largest share repurchase of Cogobuy happens from 2016 Oct 28 to 2016 Dec 31,
which used HKD 347.47 mn and is highlighted above.
How does this share repurchase intersect with investor X? As you may expect, investor X has again
sold a large chunk of its share during that period. If you look at CCASS, investor X has been using
both First Shanghai and Standard Chartered account to sell the share. Since he has moved part of
the share to Standard Chartered (On 2016 Dec 1, 6.95 mn share was moved to from First Shanghai
to Standard Chartered), we aggregate the holding reduction for First Shanghai and Standard
Chartered together, and found out that the two brokers have reduced a total of 20.06 mn shares
with an estimated proceeds of HKD 240.15 mn during the above period:

Exhibit 45: Share Repurchase v.s. First Shanghai & Standard Chartered
Estimated Sales of Cogobuy Share from 2016 Oct to Dec
Est. Number of Shares Sold Est. Accumulative
(thousand) Proceeds (HKD mn)
5,000 300
4,000 250
3,000 200
2,000 150
1,000 100
0 50
28/10/2016
-1,000 07/11/2016 15/11/2016 23/11/2016 01/12/2016 09/12/2016 19/12/2016 29/12/20160
No. of Repurchase Share (Trade Date, Left Axis)

Est. No. of Total Shares Sold (Bought) by First Shanghai and Standard Chartered (Left Axis)
Est. Accumulative Proceeds from Sales of Share (Right Axis)
Source: HKEx, Webb-site Estimation based on CCASS decrease of holding

Note 1: On 2016 Dec 1, 2.4 mn share was moved from Sinolink Securities to Standard Chartered and is
excluded in our calculation
Note 2: Proceeds from sales of share is estimated by number of shares sold multiplied by the closing price
of share on that day
To our astonishment, the shares sold by Investor X through First Shanghai and Standard
Chartered together already accounts for around two-third of the share repurchased by
Cogobuy during the same period:
Exhibit 46: Investor X's estimated profit from 2016 Oct to Dec
First Standard
Total
Shanghai Chartered
Holding on 2016 Oct 31 12,962,000 46,745,522 59,707,522
Holding on 2017 Jan 4 2,181,000 39,871,345 42,052,345
Decrease in holding 10,781,000 6,874,177 17,655,177
Adj. for Sinolink 2.4 mn transfer on 2016 Dec 1 2,400,000 2,400,000
Est. No. of Shares Sold 10,781,000 9,274,177 20,055,177
Weighted-average Price (HKD) 11.91 12.05 11.97
Est. Proceeds from Sales of Share (HKD) 128,368,380 111,784,767 240,153,147
Cost of Share (@IPO Price HKD 4.0 per share) 43,124,000 37,096,708 80,220,708
Profit (HKD) 85,244,380 74,688,059 159,932,439
Share Repurchased by Cogobuy during the

29,251,000
same period
No. of Selling Shares / Share Repurchased
36.9% 31.7% 68.6%
by Cogobuy during the same period (%)
Source: HKEx, Webb-site

The full calculation table can be found on Appendix. Combining the three sell-down, it can be
seen that investor X already sold majority of the share at a high price with a profitability that is
almost unparalleled in the market:
Exhibit 47: Estimated Profit for Investor X (HKD unless otherwise specified)
Est. Est.
Est. No. of
Details Est. Cost Proceeds Est. Profit Return
Shares Sold
from Sales (%)
First Sales of Shares
4,696,000 18,784,000 57,408,740 38,624,740 205.6%
(2016 June and July)
Second Sales of Shares
8,186,000 32,744,000 104,015,720 71,271,720 217.7%
(2016 September)
Third Sales of Shares
20,055,177 80,220,708 240,153,147 159,932,439 199.4%
(2016 Nov to 2017 Jan)
Total 32,937,177 131,748,708 401,577,607 269,828,899 204.8%
Some readers may point out that the share repurchase does not exactly overlap with the sales of
share from First Shanghai and Standard Chartered. But bear in mind that there is no need of exact
matching. The only need for the share repurchase is to maintain the share price at a high level,
such that investor X can sell his shares at a high price. For example, investor X can first sell his
share to a retail investor in open market who later sell back the share to Cogobuy in share
repurchase. We believe it is impossible to maintain the share price at such a high level when
investor X sold over 20 mn shares if Cogobuy has not conducted the large-scaled share
repurchase during the same period.
It may be argued that the holder of Standard Chartered account is unrelated to investor X, and
investor X may just sell its share to the Standard Chartered account holder on 2016 Dec 1. But
that is unimportant, since it is already highly abnormal that two or few account holders can
constitute 68.6% of a share repurchase, which supposed to be conducted in open market.
We believe that the share repurchase is likely a scheme to funnel proceeds from placement
into friendly accounts of Mr. Kang.
We challenge the management to disclose (i) the details of share repurchase, including the
source of shares on each day breakdown by brokers, and (ii) the identity of investor X and
his relationship with Mr. Kang. We also urge SFC to investigate the above share repurchase
to see if there is any insider dealing or market manipulation.
16
Source: https://kknews.cc/finance/3ob3x8.html

Part 6. The Infamous History of Cogo Group in U.S.
Cogobuy is not the first listed company owned by Mr. Kang. Majority of the assets of today
Cogobuy came from its former entity, Cogo Group, which was listed in NASDAQ, known as
Comtech Group, Inc., Cogo Group, Inc. and Viewtran Group, Inc. (COGO.US/VIEW.US). Comtech
Group, Inc. went public through a reverse merger in July 2004, changed its name to Cogo Group,
Inc. in May 2008, undergo redomestication from Maryland to Cayman Islands in August 2011 and
further changed its name to Viewtran Group, Inc. in November 2013.
Price (USD) Exhibit 48: Share Price of Cogo Group since listing Turnover
25 8,000,000
7,000,000
20
6,000,000
15 5,000,000
4,000,000
10 3,000,000
2,000,000
5
1,000,000
0 0
Turnover (right axis) Closing Price (Left Axis)
Source: Bloomberg
Numerous Sales of Share by Mr. Kang
Shortly after being listed through a reverse merger, Mr. Kang, together with his brother Mr. Yi
Kang, started to dispose a substantial amount of their shareholding in Cogo Group when its stock
price rising rapidly, receiving around USD 72.8 mn of cash in just 3 years from 2005 to 2007.
Cogo Group has been announcing many positive news to simulate the share price with an
unparalleled performance during the same period. The table below indicated the change in
shareholding of Mr. Kang and Mr. Yi Kang from 2004 to 2007.
Exhibit 49: The reduce in shareholding of Mr. Kang and Mr. Yi Kang in Cogo Group
2004 2005 2006 2007
Mr. Kangs Shareholding 72.6% 47.1% 32.8% 26.4%
Mr. Yi Kangs Shareholding 0.0% 0.0% 8.1% 6.0%
Total Shareholding 72.6% 47.1% 40.9% 32.4%
Source: SEC filings of Cogo Group

Suspicious Acquisition with High Premium
Starting from 2006, Cogo Group used a substantial amount of money raised to buy companies
with a huge amount of goodwill and intangible assets. Moreover, none of the announcements of
these acquisitions tell investors the past profitability of the targets on a stand-alone basis. Below
is a list showing major acquisitions made from 2006, which are all questionable in our opinion.
We believe the Company is making acquisitions at an unreasonable price to explain the missing
cash of Cogo Group (Please refer to Same Story for Cogo Group: RMB 990mn of disappeared
cash under Part 4. RMB 1.9 billion of Disappeared Cash).
Exhibit 50: Cogo Groups various acquisitions net asset acquired, goodwill and intangibles
Net asset acquired Goodwill Intangibles
Date Target
(RMB) (RMB) (RMB)
2006 Viewtran Technologies 58,529,000 42,428,000 14,756,000
2006 Shanghai E&T 16,000,000 4,264,000 5,467,000
2007 Comtech Broadband 113,193,000 47,561,000 74,578,000
2007 Keen Awards 63,032,000 - 73,007,000
2008 Longrise 60,921,000 21,422,000 34,547,000
2009 Mega Smart Group 122,415,000 80,226,000 50,526,000
2011 MDC Technologies 144,372,000 61,509,000 99,237,000
Source: SEC filings of Cogo Group
Most of the above acquisitions are suspicious with a high premium and large intangible. For
example, Cogo Group once disclosed Mr. Kang has controlling interest in Viewtran Technologies
in its 2005 10-K filing but then was silent with this when announcing the acquisition of Viewtran
in 2006 with a high premium. Another shocking example is Comtech Broadband, which is still a
subsidiary of Cogobuy today:
Comtech Broadband: Funneling RMB 113 mn Cash out of Cogo Group
The history of Comtech Broadband goes back to 2004 Dec. In 2004 Dec, Cogo Group signed an
agreement with Broadwell Group to establish a joint venture, which is Comtech Broadband, to
serve as an independent distributor promoting IC's and components into China market. Initially,
Cogo Group owns 55% of the share and Broadwell Group owns 45% of the remaining share. The
total investment of the JV company is only HKD 1 mn at that time. Broadwell Group is a BVI
company with undisclosed background, with the addressee of Steve Deng.
Then in 2007 August, Cogo Group acquired the remaining 45% of the share from Broadwell Group
at RMB 113.19 mn, giving Comtech Broadband a whopping valuation of RMB 251.54 mn. Broad
Wise Holdings Limited, the wholly owned subsidiary of Broadwell Group, owns the shares of
Comtech Broadband directly:

Exhibit 51: Description on the acquisition of Comtech Broadband 45% share
Source: 8-K Report filed by Cogo Group
Three years later in 2010 December, Cogo Group mysteriously awarded 30% share of Comtech
Broadband for free to an undisclosed employee:
Exhibit 52: the share-based compensation of Comtech Broadband
Source: Cogo Groups 2010 Annual Report
If using the same valuation in 2007 acquisition, the share is worth RMB75.46mn. However, from
above disclosure, the fair value of the share is just USD 4.8 mn (dollar figures are in thousands for
the exhibit above), indicating the valuation of Comtech Broadband is USD 16 mn, or RMB 105.6
mn, only 42.0% of the valuation when it acquired the 45% interest. The identity of this mysterious
employee was widely questioned by U.S. investors at that time but of course was never answered.
The mystery was finally solved by Cogobuys prospectus four years after:
Exhibit 53: the description of Broadband Corporation (i.e. Comtech Broadband) on Cogobuys
prospectus
Source: Cogobuys prospectus Pg. 79
Here we shockingly see Broad Wise Holdings Limited and Mr. Deng again, the seller of the 45%
interest back in 2008. In short, Mr. Deng used HKD 0.45 mn to establish a JV with Cogo Group,
and sold his 45% shares back to Cogo Group at RMB 113.19 mn. Three years later, Cogo Group
gave back 30% share to Mr. Deng for free. It seems the only point of the operation is to funnel
cash out of Cogo Group. Mr. Deng is now the vice president of Cogobuy, and Comtech Broadband
is a subsidiary of Cogobuy with Mr. Deng still holding 30% of it.

The majority other acquisitions are with a similar nature: undisclosed sellers, high valuation, large
intangibles and goodwill. We believe that most of these transactions are just related party
transaction to explain the missing cash or funnel cash out of the company.
Please note that Hope Ni, the CFO of Cogo Group since 2004 who oversaw all these suspicious
transactions, is now promoted to the Executive Director and Chief Investment Officer of Cogobuy.
And Allen Wu, the vice president of finance at Cogo Group since 2003, is now promoted to the
Executive Director and CFO of Cogobuy. Besides Mr. Kang, they are currently the only executive
directors of Cogobuy. There is no industry expert (except Mr. Kang if you count him, but we
consider him more of a financial expert) among the executive directors. It seems that Mr. Kang
really appreciates these financial experts efforts contributed in Cogo Group, and you
should now understand why there are so many similarities between the tricks used by Cogo
Group and Cogobuy.
The Ending of Cogo Group: A worthless paper
After the start of financial crisis in 2008, share price of Cogo Group dropped significantly and Mr.
Kang stopped disposing his shareholding. Cogo Group then initiated the above mentioned
redomestication from Maryland to Cayman Islands to facilitate its future capital market movement
(Sale of all or substantially all the assets of the Company requires approval by the affirmative vote
of two-thirds of all the votes in Maryland while theres no such requirement for companies in
Cayman Islands). Mr. Kang has also tried promoting the new concept of Cogo 3.0, an online
platform for IC trading, to simulate share price but to no avail. Shortly after the redomestication,
Cogo Group sold a substantial part of its subsidiaries (representing approximately 32% of the
Companys total revenue) to Mr. Kang for a total consideration of just USD 78 mn in November
2012. In 2013, Cogo Group again sold a substantial part of its remaining subsidiaries (representing
approximately 30% of the remaining net assets and generate 98.7% of the Cogo Groups revenue
in Q1 2013) to Mr. Kang for a total consideration of USD 80 mn. The two acquisitions made up a
major part of the Cogobuy now and you may realize the huge difference between the acquisition
price and current market cap of Cogobuy.
Despite Mr. Kang claimed to have no intention of dissolving Cogo Group or going private, after
filing a form to SEC stating that the company is unable to timely file 20-F due to inability of
completing valuation of certain intangible assets (they even quote receiving a letter from NASDAQ
stating that Viewtran is not in compliance with listing rules as a reason for delisting), and Cogo
Group was finally delisted from NASDAQ in 2015. Today Cogo Group is still trading at the highly
illiquid OTC Bulletin Board with a share price lower than USD0.1, having more than a hundred
times difference with its historical high price of USD22.15 in October 2007.
We believe such track record will give you a rough idea on Mr. Kangs style, and Cogobuy is no
different from Cogo Group. We have already observed many aspects of Cogobuy that is
strikingly similar with Cogo Group, such as the use of popular concept to inflate share price
(Cogo 3.0 versus IngDan now), use of receivables and inventory to explain missing cash,
zero dividend policy, unusual growth rate, same management etc. Similar to Cogo Group,
we expect that Mr. Kang will start to dispose his shareholding very soon, or he may already
start doing so through the suspicious share repurchase (Please refer to Part 5. Mysterious
Share Repurchase: Two-third of the largest share repurchased come from two accounts).
We believe that investing Cogobuy today is just similar to investing in Cogo Group ten years
ago, which will only leave you with a worthless paper.

Part 7. A Share Placement with Guaranteed Return but still attract no Industry Investor17
As mentioned previously, Cogobuy has completed a placement of new shares on 22 September

2016, just before starting the large-scaled share repurchase program. Management always hails
this placement as an indication of Cogobuys strong performance, but we think it exactly shows
the opposite if you look at the detail of the placement.
This placing was first announced on 20 May 2016 where the Company entered into a
memorandum of understanding with Da Cheng International Asset Management (Da Cheng),
pursuant to which Da Cheng has conditionally agreed to subscribe between 124,800,000 and
187,200,000 new Shares at a price of HKD 12.5 per Share. At the same time, Mr. Kang also entered
into a memorandum of understanding with Da Cheng agreeing that Da Cheng has an option to
sell the Placing Shares to Mr. Kang at HKD 12.88 per share on the last day of the three-year
period after entering into Placing Agreement.
Three months later, on 1 September 2016, the Company subsequently announced that it entered
into Placing Agreement with Hong Kong International Securities Limited such that Hong Kong
International Securities Limited agreed, on a best effort basis, to procure not less than six
independent placees to subscribe for up to a total of 270,466,900 new Placing Shares (16.67% of
the then enlarged share capital), at a price of HKD 12.5 per Placing Share. Similarly, Mr. Kang will
compensate the placees if the share price falls below HKD 12.88 per share on the last day of
a three-year period after entering into Placing Agreement.
Intuitively, one would think this is a placement with no downside unless Mr. Kang is bankrupt and
unable to honor his undertakings and therefore expect strong interest from institutional investors,
as well as industry players.
Shockingly, when the placement was completed on 22 September 2016, only 160,420,232 new
shares (10.6% of the then enlarged share capital; just 60% of the number of shares it
intended to place) were placed to placees including Da Cheng, National Pension service, Korea
Development Bank, Korea Teachers Credit Union, Korea Post, China Reinsurance (Group)
Corporation, The Peoples Insurance Company (Group) of China, New China Asset Management
and Chongqing Liangjiang Automobile Industry Innovation Development Fund at a price of HKD
12.5 per share with Mr. Kang agreeing to compensate the placees if the share price falls below
HKD 12.88 per share on the last day of a three-year period after entering into Placing Agreement.
The investors are so careful that they even added the clause that if they sold the stock in market
six months before the last day, they can request Mr. Kang to compensate the difference to them.
It seems that the investors afraid that Mr. Kang just boost the share price up to HKD 12.88 on the
last day to avoid compensation.

Exhibit 54: Compensation Arrangement of the Placement
Source: Cogobuys placing announcement on 2016 September 1, pg. 6
Apart from the significant shrink in offering size, if we look into the name of investors, one would
discover that there is no involvement of any industry players nor any institutional investors actively
investing in the technology sector, reflecting how the whole industry views Cogobuy. The fact that
two more placing agents, CCB International Capital Limited and ABCI Securities Company Limited,
had to be added in order to complete the transaction also reflects the low level of interest received
from investors.
17
Source: Cogobuys announcements on 2016 May 20, 2016 September 1 and 2016 September 22

Valuation
In order to value Cogobuy, we would first estimate its true revenue and net profit in 2015. Then
we will apply the average P/E ratio of its IC distributor peers to arrive the final valuation.
As stated in the Part 2. Significant Discrepancy in SAIC filings, total PRC sales figure of Cogobuy
in 2015 on SAIC filings is only RMB 386 mn. Conservatively assuming only 10% of sales is settled
in China, total revenue of Cogobuy in 2015 would be RMB 3.86 bn.
Considering average net profit ratio of other IC distributor peers in 2015, which is around 1.8%,
we estimate net profit of Cogobuy in 2015 to be around RMB 69.48 mn.
At last, applying average P/E ratio of its IC distributor peers at approximate 10x, market cap of
Cogobuy should be around RMB 694.8 million, implying a share price of RMB 0.47, i.e. around
HKD 0.53 per share, representing a 95% drop from its closing price of HKD 10.00 as of 19 May
2017.
Exhibit 55: Valuation of Cogobuy

2015 total sales from SAIC filings (RMB million) 386
Estimated Cogobuys 2015 total sales (RMB million)
3,860
(Assuming 10% of sales are settled in China)
Average net profit ratio of other IC distributor peers in 2015 1.8%
Estimated Cogobuys 2015 net profit (RMB million) 69.48
P/E ratio of other IC distributor peers 10x
Estimated market cap of Cogobuy (RMB million) 694.8
Implied share price (RMB) 0.47
Implied share price (HKD) 0.53
The share price will even be lower if you apply a corruption discount to Cogobuy. And as we are
using relative valuation here, we implicitly assume that Cogobuy will distribute dividend as its
peers, which may not be the real case. Cogo Group is a good example to learn form.
In case Cogobuys share price drops to HKD 0.53 per share, Mr. Kang will have to compensate
around HKD 2 bn to investors three years after. We do not believe Mr. Kang will be able to repay
such a large sum and his potential bankruptcy may severely threaten continuity of Cogobuys
operations in the future.

Conclusion
To conclude with, it is crystal clear that Cogobuy is just another bubble orchestrated by Mr. Kang
to dupe innocent investors. We believe Cogobuy worth at most HKD 0.53 per share, instead of
HKD 10.00 currently (as of 19 May 2017).
Of course Mr. Kang and his colleagues Hope Ni and Allen Wu are largely responsible for
Cogobuys fraud and we urge SFC to investigate these people, but we think that the current system
of Hong Kong IPO has its own flaw that we should reflect on:
Under Hong Kong IPO system, sponsor is supposed to conduct due diligence on every sentence
stated on prospectus, and investors believe a companys prospectus partly because of the due
diligence work done by sponsor. However, we have seen certain sponsor principals, such as those
representing UBS, has done minimal due diligence during IPO. Many of the above findings, such
as low website traffic, can be easily observed if sufficient due diligence is done. But knowing the
fact that they can at most have their licenses revoked, certain sponsor principals sign numerous
deals without full due diligence such that they can earn a considerable sum and leave the security
industry afterwards. The new sponsor regime (which this case falls into) is supposed to fight
against such loophole. Under the new regime, the maximum penalty to sponsor principal is three
years of imprisonment for any material untrue statements in the prospectus. But the penalty we
have seen so far to sponsor principal is far from deterring such kind of activity and the
imprisonment punishment seems amount to nothing from the eyes of sponsor principle.
Given the disastrous track record of UBS, we urge SFC to use the rule from new sponsor regime
for the first time and the court to apply the maximum penalty of three-year imprisonment
to the sponsor principle responsible for this deal, even if he or she already left the industry.
A clear signal should be sent to the industry such that other sponsor principles should be deferred
from cooperating with fraudulent companies to dupe investors. Otherwise, these fraudulent IPOs
will continue in Hong Kong endlessly.

Appendix A: The supply chain matching record on IngDan.com
# Request Time User Demand
1 4/30/2017 16:49 NB-800M

2 4/30/2017 16:47

3 4/27/2017 17:17
4 4/27/2017 17:07
5 4/27/2017 14:42 DC5V
1 5 120 2
6 4/27/2017 8:23 dan_a8501fa5

7 4/27/2017 8:20 dan_a8501fa5
8 4/27/2017 8:16 dan_a8501fa5
9 4/27/2017 8:15 dan_a8501fa5 5mm 20cm
10 4/27/2017 8:13 dan_a8501fa5
11 4/26/2017 13:13 forsafe 0.01g cmc
5 1080p 500w cmos wifi
12 4/26/2017 13:10 forsafe

dan_53584ec20
13 4/26/2017 12:42 (+PCB )
725
dan_53584ec20
14 4/26/2017 12:41 ++(13867652183)
725

15 4/26/2017 12:09

16 4/26/2017 10:30 App 4.0ble
17 4/26/2017 10:22 dan_764e1771 SHINDENGEN K1V(A)16 21
dan_d3b68b213
18 4/25/2017 22:16
137
19 4/25/2017 15:18 6mm 20mm 150 3V

20 4/25/2017 15:00 andyqiu1973
PCBA

dan_dd6cc3473
21 4/25/2017 14:13
af2

22 4/25/2017 13:24
23 4/25/2017 12:47 ipad PC
dan_e671af7784
24 4/25/2017 11:00 433 485
f1
25 4/24/2017 19:06 ,,

26 4/24/2017 17:35

720 3G
27 4/24/2017 17:29 3
3G

28 4/24/2017 17:02 goodoyo

29 4/24/2017 16:54 60cm, 45cm, 20cm.
30 4/24/2017 16:26 goodoyo
31 4/24/2017 16:22 goodoyo

32 4/24/2017 15:14 Chanson2015

dan_2d06b430d app
33 4/24/2017 15:07
439
dan_a962027a2
34 4/24/2017 11:09
7d9
dan_211d46ab3
35 4/24/2017 10:29
cd6
dan_211d46ab3
36 4/24/2017 10:29
cd6
37 4/24/2017 10:09 dan_24t1fasf 6085 GPS
38 4/24/2017 9:08
39 4/23/2017 13:19 cheng
40 4/21/2017 16:41 pblimo APP
41 4/21/2017 16:02 dan_kmakoeep

42 4/21/2017 16:02 dan_kmakoeep
APP
43 4/21/2017 14:49
18823118987
dan_53584ec20
44 4/21/2017 13:18 (+PCB )
725
1. 2.
dan_401ce934f9
45 4/21/2017 11:46 3.4.
da

https://v.qq.com/x/page/p03316ogo70.html
dan_aa298e74e
46 4/21/2017 3:16 WiFi
65e

47 4/20/2017 18:13 dan_a4e855ae
48 4/20/2017 18:03 dan_a4e855ae
7.85 >=86%6H -20 -+70 <=90%RH -30 -
49 4/20/2017 16:51
+80 <=90%RH
50 4/20/2017 16:16 dan_6crgj38m
51 4/20/2017 15:45

52 4/20/2017 14:55 MTKGPS4G
APP
dan_a344fda326
53 4/20/2017 9:17 wifi
d1
,
54 4/19/2017 23:09 dan_y9zk952b

18mm APP
55 4/19/2017 23:05 dan_e28de01b

56 4/19/2017 20:41
57 4/19/2017 14:56 150mm 380mm* 200mm* 80mm

58 4/19/2017 10:17

123
59 4/19/2017 0:32 4 35-40CM 5 3-4CM

dan_826a22f40c :------PLC -
60 4/18/2017 21:27
b9 -, PLC 304
dan_826a22f40c
61 4/18/2017 21:16 ..... PLC ..304 ..
b9
62 4/18/2017 21:15 Jeff Xu pcbbom
30 1
dan_1a0bacc6e9
63 4/18/2017 16:02 POS 23
6e
wifi4 gps
64 4/18/2017 14:33 Jeff EVA
65 4/18/2017 14:29 Jeff EVA
66 4/17/2017 17:58 dan_klq87c3m
dan_1f0c356b95
67 4/17/2017 17:54 App
2e
1 gps
68 4/17/2017 15:49

dan_a962027a2
69 4/17/2017 9:33
7d9
dan_d824e913b
70 4/14/2017 21:00 ,
397
dan_1a0bacc6e9 30 1
71 4/14/2017 16:11
6e POS 2
dan_f4ef916b0c
72 4/14/2017 12:21
6b
dan_f4ef916b0c
73 4/14/2017 12:21
6b
1 2 3 4 3 1
74 4/13/2017 20:19 dan_6718d691
2 3

dan_d824e913b
75 4/13/2017 17:16 HUD OEM
397
76 4/13/2017 16:09 Dasion Zoran
GPS
77 4/13/2017 16:06

78 4/13/2017 15:25 happycool333 50-100hz app
zigbee
79 4/13/2017 15:25 happycool333

wifi
80 4/13/2017 15:22 happycool333
linux andriod

81 4/13/2017 11:41 dorcg

wifi,
82 4/12/2017 20:49 dan_c81f2a9a
android
83 4/12/2017 18:11 muttofan OA IOSAPP

84 4/12/2017 10:22

85 4/11/2017 18:11 Rayman999

86 4/11/2017 16:49 shande 12V30A

USB//1
87 4/11/2017 16:03 zhxiaolg 23 1
45
88 4/11/2017 11:57 windist
89 4/11/2017 11:32 daxiang
90 4/10/2017 18:51 jerry wifi , 500K jerry13428958065
91 4/10/2017 14:28
dan_60f7941df3
92 4/10/2017 10:34 R16/A20 ARM
dc

dan_dca1dc43e
93 4/9/2017 20:56
071

94 4/9/2017 20:12

95 4/7/2017 14:31 dorcg

AR/VR/MR// Windows Android (
96 4/7/2017 13:13 jerry //+) SDK, 10K
jerry13428958065.
:1.\\CO2 : 2.4Gzigbee,,,
dan_8ca2e1bf00
97 4/7/2017 11:52 2. 2.4Gzigbee, 3.,\ Wi-
32
Fi,2.4GHzZigbee SDK, TCP/IP,HTTP
dan_ad39d1b2c NB-IOT
98 4/7/2017 11:25
23a
99 4/7/2017 11:17 miswaytech 1.9*3.2mm 3.5*5.2mm
dan_wqspbmqy
100 4/6/2017 18:17
9jzc .

101 4/6/2017 17:04 Will Wang

102 4/6/2017 17:00 mxtonx GSM GPS

dan_21def4553e
103 4/6/2017 12:33 App
56

104 4/6/2017 11:07 VR

dan_60f7941df3
105 4/6/2017 9:42
dc
sos
106 4/6/2017 9:34
18823118987.
107 4/5/2017 14:27 mxtonx PM2.5 voc

wifi,
108 4/5/2017 10:09 dan_c81f2a9a

DC
109 4/5/2017 3:52 marco
24 900
110 4/4/2017 20:26 +typeC
111 4/4/2017 11:52 4Gwifi FM
112 4/1/2017 16:06 windist 4007
113 4/1/2017 15:45 150mm 380mm* 200mm* 80mm
114 4/1/2017 15:39 miswaytech BSCI
115 4/1/2017 15:37 miswaytech
dan_930f1f40de PCB 4 LCD
116 4/1/2017 14:16
14
SOS
117 4/1/2017 11:40

Source: http://biz.ingdan.com/link/anli, as of 2017 May 8

Appendix B: Cogobuys Share Repurchase and First Shanghai & Standard Chartered Estimated Sales of Cogobuy Share from
2016 Oct to Dec
Est. No. of
Closing Total Shares
No. of First Standard First Standard Proceeds
Price Vol. Sold (Bought)
Holding Trade Repurchase Shanghai Chartered Shanghai Chartered from Sales
(HKD, (Trade in market by
Date Date Share (Trade CCASS CCASS CCASS CCASS of Share
Trade Date) First Shanghai
Date) Holdings Holdings Decrease Decrease (HKD)
Date) and Standard
Chartered
11/1/2016 10/28/2016 2,198,000 12.22 4,831,000 12,962,000 46,549,522 0 196,000 196,000 2,395,120
11/2/2016 10/31/2016 2,338,000 12.12 5,254,518 12,962,000 46,351,504 0 198,018 198,018 2,399,978
11/3/2016 11/1/2016 464,000 12.28 2,579,000 12,968,000 46,227,504 -6,000 124,000 118,000 1,449,040
11/4/2016 11/2/2016 601,000 12.3 2,647,000 12,968,000 45,499,504 0 728,000 728,000 8,954,400
11/7/2016 11/3/2016 107,000 12.16 1,899,000 12,968,000 45,251,674 0 247,830 247,830 3,013,613
11/8/2016 11/4/2016 496,000 11.98 2,508,000 12,988,000 45,027,504 -20,000 224,170 204,170 2,445,957
11/9/2016 11/7/2016 111,000 12.04 2,389,000 12,988,000 45,388,504 0 -361,000 -361,000 -4,346,440
11/10/2016 11/8/2016 0 12.06 1,052,000 12,988,000 45,389,504 0 -1,000 -1,000 -12,060
11/11/2016 11/9/2016 1,220,000 12.02 4,245,000 12,988,000 41,014,504 0 4,375,000 4,375,000 52,587,500
11/14/2016 11/10/2016 0 12.3 2,984,300 12,959,000 40,846,504 29,000 168,000 197,000 2,423,100
11/15/2016 11/11/2016 1,187,000 12.34 3,029,000 12,959,000 40,780,504 0 66,000 66,000 814,440
11/16/2016 11/14/2016 0 11.98 1,881,352 12,959,000 41,058,152 0 -277,648 -277,648 -3,326,223
11/17/2016 11/15/2016 0 11.96 1,790,000 12,959,000 41,093,152 0 -35,000 -35,000 -418,600
11/18/2016 11/16/2016 0 11.86 4,193,000 12,461,000 39,729,152 498,000 1,364,000 1,862,000 22,083,320
11/21/2016 11/17/2016 0 11.92 1,979,452 12,216,000 38,755,152 245,000 974,000 1,219,000 14,530,480
11/22/2016 11/18/2016 0 12.08 4,005,000 11,716,000 36,639,332 500,000 2,115,820 2,615,820 31,599,106
11/23/2016 11/21/2016 445,000 12.04 11,312,000 11,716,000 35,879,332 0 760,000 760,000 9,150,400
11/24/2016 11/22/2016 469,000 12.1 2,612,820 11,716,000 34,661,332 0 1,218,000 1,218,000 14,737,800
11/25/2016 11/23/2016 878,000 11.98 3,110,000 11,716,000 33,168,414 0 1,492,918 1,492,918 17,885,158
11/28/2016 11/24/2016 402,000 11.84 2,397,000 11,716,000 33,022,363 0 146,051 146,051 1,729,244
11/29/2016 11/25/2016 400,000 11.44 6,453,000 11,771,000 32,932,332 -55,000 90,031 35,031 400,755
11/30/2016 11/28/2016 296,000 12 5,343,000 11,776,000 32,796,332 -5,000 136,000 131,000 1,572,000
12/1/2016 11/29/2016 325,000 11.9 1,596,000 11,776,000 35,147,332 0 -2,351,000 49,000 1
583,100
12/2/2016 11/30/2016 231,000 11.8 1,263,000 11,776,000 34,906,332 0 241,000 241,000 2,843,800

Est. No. of
Closing Total Shares
No. of First Standard First Standard Proceeds
Price Vol. Sold (Bought)
Holding Trade Repurchase Shanghai Chartered Shanghai Chartered from Sales
(HKD, (Trade in market by
Date Date Share (Trade CCASS CCASS CCASS CCASS of Share
Trade Date) First Shanghai
Date) Holdings Holdings Decrease Decrease (HKD)
Date) and Standard
Chartered
12/5/2016 12/1/2016 173,000 11.8 1,511,000 11,779,000 34,874,332 -3,000 32,000 29,000 342,200
12/6/2016 12/2/2016 855,000 11.7 2,355,000 11,769,000 34,620,332 10,000 254,000 264,000 3,088,800
12/7/2016 12/5/2016 4,424,000 11.9 6,951,000 11,778,000 32,699,332 -9,000 1,921,000 1,912,000 22,752,800
12/8/2016 12/6/2016 526,000 11.96 1,307,177 4,828,000 39,597,332 6,950,000 -6,898,000 52,000 621,920
12/9/2016 12/7/2016 339,000 12 970,000 4,858,000 39,675,332 -30,000 -78,000 -108,000 -1,296,000
12/12/2016 12/8/2016 401,000 11.94 1,024,000 4,699,000 39,843,332 159,000 -168,000 -9,000 -107,460
12/13/2016 12/9/2016 825,000 11.68 2,090,000 4,398,000 39,888,332 301,000 -45,000 256,000 2,990,080
12/14/2016 12/12/2016 480,000 11.68 2,497,130 4,068,000 40,931,202 330,000 -1,042,870 -712,870 -8,326,322
12/15/2016 12/13/2016 449,000 11.6 1,055,000 3,934,000 40,961,202 134,000 -30,000 104,000 1,206,400
12/16/2016 12/14/2016 385,000 11.62 1,380,043 3,792,000 40,808,245 142,000 152,957 294,957 3,427,400
12/19/2016 12/15/2016 2,012,000 11.66 4,816,437 3,517,000 40,842,245 275,000 -34,000 241,000 2,810,060
12/20/2016 12/16/2016 958,000 11.8 1,515,234 3,522,000 40,607,245 -5,000 235,000 230,000 2,714,000
12/21/2016 12/19/2016 1,602,000 11.82 2,441,000 3,222,000 40,443,245 300,000 164,000 464,000 5,484,480
12/22/2016 12/20/2016 371,000 11.84 930,000 3,122,000 40,402,245 100,000 41,000 141,000 1,669,440
12/23/2016 12/21/2016 404,000 11.78 1,097,350 2,822,000 40,309,345 300,000 92,900 392,900 4,628,362
12/28/2016 12/22/2016 467,000 11.74 922,000 2,682,000 40,204,345 140,000 105,000 245,000 2,876,300
12/29/2016 12/23/2016 1,150,000 11.7 1,874,150 2,393,000 40,256,345 289,000 -52,000 237,000 2,772,900
12/30/2016 12/28/2016 289,000 11.8 876,000 2,181,000 40,289,345 212,000 -33,000 179,000 2,112,200
1/3/2017 12/29/2016 275,000 11.7 795,054 2,181,000 40,153,345 0 136,000 136,000 1,591,200
1/4/2017 12/30/2016 698,000 11.7 2,391,000 2,181,000 39,871,345 0 282,000 282,000 3,299,400
Total 29,251,000 10,781,000 9,274,177 20,055,177 240,153,147
Source: HKEx, Webb-site Estimation based on CCASS decrease of holding

Note 1: On 2016 Dec 1, 2.4 mn shares were moved from Sinolink Securities to Standard Chartered and is excluded in our calculation
Note 2: Proceeds from sales of share is estimated by number of shares sold multiplied by the closing price of share on that day

Appendix C: SAIC filings of Comtech Digital Technology (Shenzhen) Limited in 2015
Welcome! Comtech Digital Technology (Shenzhen) Limited Logout

Reporting Year Comtech Digital Technology
(Shenzhen) Limited
Company Name
Total Asset RMB 203159.3 thousand Opt to not disclose
Shareholders Equity RMB 15488.1 thousand Opt to not disclose
Revenue RMB 99800.9 thousand Opt to not disclose
In which: revenue from major activities RMB9980.09 thousand Opt to not disclose
Profit before Tax RMB 13977.6 thousand Opt to not disclose
Net Profit RMB 10483.2 thousand Opt to not disclose
Total Tax Payment RMB 6792.6 thousand Opt to not disclose
Total Liability RMB 187671.2 thousand Opt to not disclose

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Summary

We are here to introduce another Hong Kong-listed Cogobuy Group

Website: www.blazing-research.com / Email: blazing.research.m@protonmail.ch

3. Unparalleled Financial Performance compared to its Peer

6. Infamous U.S. Listing History of its Former Entity, Cogo Group

7. A Share Placement that is Undersubscribed and has no Industry Investor

Website: www.blazing-research.com / Email: blazing.research.m@protonmail.ch

Website: www.blazing-research.com / Email: blazing.research.m@protonmail.ch

Website: www.blazing-research.com / Email: blazing.research.m@protonmail.ch

According to the Companys disclosure, Cogobuy.com is the largest transaction-based e-

Traffic myth of Cogobuy.com and IngDan.com

Source: Cogobuy 2014 Prospectus, Pg 72

Website: www.blazing-research.com / Email: blazing.research.m@protonmail.ch

Website: www.blazing-research.com / Email: blazing.research.m@protonmail.ch

A Tour of Cogobuy.com, the most outdated E-Commerce IC Platform in China

Exhibit 3: Screenshot of http://cogobuy.com

Source: http://cogobuy.com, as of 2017 May 8

Website: www.blazing-research.com / Email: blazing.research.m@protonmail.ch

Selected Product (Industry trend, newest and hottest products)

Source: http://www.cogobuy.com, as of 2017 May 8

Exhibit 5: Screenshot of Cogobuy.com as of 2014 Jul 7

Selected Product (Industry trend, newest and hottest products)

Source: https://web.archive.org/web/20140707043044/https://cogobuy.com/, as of 2017 May 8

Website: www.blazing-research.com / Email: blazing.research.m@protonmail.ch

Exhibit 6: Screenshot of Cogobuys SanDisk Section

We provide the following product:

Source: http://www.cogobuy.com/brand/1-71.html, as of 2017 May 8

Website: www.blazing-research.com / Email: blazing.research.m@protonmail.ch

Exhibit 7: iNAND brands availability on Cogobuy.com and other IC platforms

Exhibit 8: Screenshot of Cogobuys search result on SDIN8DR1

Source: http://www.cogobuy.com/home/List_search?keyword=SDIN8DR1, as of 2017 May 8

Website: www.blazing-research.com / Email: blazing.research.m@protonmail.ch

HK Pricing PRC Pricing

Source: http://ickey.cn, as of 2017 May 8

Down for a week without maintenance

Website: www.blazing-research.com / Email: blazing.research.m@protonmail.ch

Source: http://www.cogobuy.com, as of 2017 April 26

As the management points out, Cogobuy.com, as a one-stop platform, allows SME to

Website: www.blazing-research.com / Email: blazing.research.m@protonmail.ch

Exhibit 11: List of IngDans subdomains

Website: www.blazing-research.com / Email: blazing.research.m@protonmail.ch

Exhibit 12: IngDan main page (Simplified Chinese version)

Source: http://www.ingdan.com/?language=zh as of 2017 May 8

Website: www.blazing-research.com / Email: blazing.research.m@protonmail.ch

Exhibit 13: Screenshot of IngDan Links request

Source: http://biz.ingdan.com/link/anli/8, as of 2017 May 8

Website: www.blazing-research.com / Email: blazing.research.m@protonmail.ch

Website: www.blazing-research.com / Email: blazing.research.m@protonmail.ch

Thank you IngDan and all

Thank you IngDan

Source: http://biz.ingdan.com/experience, as of 2017 May 8

Exhibit 15: Screenshot of purchasing from IngDan IoT Supermarket

Please contact customer support to

Source: http://biz.ingdan.com/iot/detail-346.html, as of 2017 May 8

Website: www.blazing-research.com / Email: blazing.research.m@protonmail.ch

IngDan Mall: All products sold or 404 Error

Exhibit 16: IngDan Mall Page

Source: http://mall.ingdan.com, as of 2017 May 8

Exhibit 17: Screenshot of IngDan Mall #1 product

Website: www.blazing-research.com / Email: blazing.research.m@protonmail.ch

Exhibit 18: Screenshot of IngDan Mall #3 product

Your visiting webpage is not found or has already

Source: http://mall.ingdan.com/item-239.html, as of 2017 May 8

Website: www.blazing-research.com / Email: blazing.research.m@protonmail.ch