Our Lottery Platform

Shenzhen Sinodata Technology Co Ltd, which the Group owns about 89.84% stake, is the leading Computer Ticket Games ("CTG") system provider for Welfare Lottery in China, accounting for approximately 50% of market share in 2009 with coverage of 16 provinces.

On the side of instant lottery ("Scratch Cards") business, Beijing Guard Libang Technology Co Ltd ("Guard Libang"), which the Group owns 50% stake, is the exclusive provider of systems and games for Scratch Cards in the Chinese Welfare Lottery market based on its proprietary 2D barcode anticounterfeiting technology. The business of Guard Libang covers the entire of China. Our strategic partnership with Scientific Games Corporation, the world renowned instant ticket system and games provider which holds 50% interest in Guard Libang, will be instrumental in enabling us to bring its expertise and technology know-how to the growing Scratch Card market in China.

Shenzhen Kingsail Software Tech Co Ltd and Guangzhou Latech Technology Co Ltd ("Guangzhou Latech"), which the Group owns 100% and 90% stakes respectively, are two of the few approved providers to the China Sports Lottery machines by China Sports Lottery Administration Centre.

Guangzhou Latech is involved in the development and production of Sports Lottery machines, related operation software system and networks (including the provision of incidental consultancy services) for the Sports Lottery industry in the PRC.

The Group intends to broaden its array of products for the system and games development business segment, especially in the Scratch Card area where, we believe, the majority of the growth lies. In November 2008, the Group has successfully entered into the Welfare Scratch Cards printing business through a cooperative venture with Shijazhuang Offset Printing House. As one of three entities authorized to print for the Welfare Scratch Cards programs, the Group's printing facilities is located at Shijazhuang, the Provincial Capital of Hebei Province.

In addition to the system and games development business, the Group started its lottery distribution and marketing business in 2008.

We commenced the rollout of its Point-of-Sales ("POS") in September 2008 which mainly focuses on the sales of the Scratch Cards for both Welfare and Sports Lotteries. With a core strategy to focus on channel sales development, the Group has already formed strategic alliance with post office, gas station and supermarket chains as our distribution channels in China. Building on the successful establishment of the Group's extensive distribution network spanning across China at prime locations with high traffic and minimum operating cost, the Group has fortified its leading position in the cooperative distribution channel in China.

In supporting the launch of Single Match Games ("SMG") in China, the Group has played an active role in participating in the distribution of SMG tickets through an increasing number of dedicated franchised shops for SMG and supplying the equipment for the launch of SMG. SMG is expected to develop into a major segment of lottery games in China and we will continue our efforts in developing and widening our network for the distribution of SMG in China.

Our Group recognizes the importance of new technologies in the shaping and development of the China Lottery Market. In this regard, we have started our mobile based lottery distribution operation in 2009 through a 50% owned joint venture. We have accumulated a substantial customer base in the provinces that we operate and expect the number of users to increase over time upon our expansion into different provinces and deepening our penetration into existing provinces.