SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x£ QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~September~~December 3031, 2011

¨£ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from ______ to __________

COMMISSION FILE NUMBER: 333-128532

CHISEN ELECTRIC CORPORATION

(Exact name of registrant as specified in its charter)

Nevada		20-2190950
(State or other jurisdiction of		(IRS Employer
incorporation or organization)		Identification No.)

No. 1188, Taihu Avenue, Changxing Economic Development Zone, Changxing, Zhejiang Province,

The People’s Republic of China

(Address of principal executive offices)

(86) 572-6267666

(Registrant’s Telephone Number, Including Area Code)

(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)

Check whether the issuer (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the issuer was required to file such reports), and (2)has been subject to such filing requirements for the past 90 days. Yes x S No ¨£

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes xS No ¨ £

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company filer. See definition of “accelerated filer” and “large accelerated filer” in Rule 12b-2 of the Exchange Act:

Large Accelerated Filer ¨£ Accelerated Filer xS Non-Accelerated Filer ¨£ Smaller Reporting Company xS

Indicate by check mark whether the registrant is a shell company as defined in Rule 12b-2 of the Exchange Act. Yes ¨ £ No xS

State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date: As of ~~November~~February 813, ~~2011~~2012, the registrant had 50500,000,000 shares of common stock, par value $0.001 per share, issued and outstanding.

TABLE OF CONTENTS

PART I FINANCIAL INFORMATION		32
ITEM 1. FINANCIAL STATEMENTS		32
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION		2725
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK		3836
ITEM 4. CONTROLS AND PROCEDURES		3937
PART II OTHER INFORMATION		4038
ITEM 1. LEGAL PROCEEDINGS		4038
ITEM 1A. RISK FACTORS		4038
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS		4038
ITEM 3. DEFAULTS UPON SENIOR SECURITIES		4038
ITEM 4. (Removed and Reserved).		40
ITEM 4. MINING SAFETY DISCLOSURE		38
ITEM 5. OTHER INFORMATION		4038
ITEM 6. EXHIBITS		4039
SIGNATURES		5047
EXHIBIT 31.1
EXHIBIT 31.2
EXHIBIT 32.1
EXHIBIT 32.2

- 2 1-

PART I

FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

~~Unaudited~~Chisen ~~Condensed~~Electric Corporation Index to Consolidated Financial Statements ofFor the nine months ended December 31, 2011

Chisen Electric Corporation

		Page

Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income		3 – 4

Unaudited Condensed Consolidated Balance Sheets		5 – 6

Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity		7

Unaudited Condensed Consolidated Statements of Cash Flows		8 – 9

Notes to and Forming Part of Unaudited Condensed Consolidated Financial Statements		10 – 24

~~For the six months ended September 30, 2011~~-2-

-Chisen 3Electric -Corporation Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income For the nine months ended December 31, 2011 and 2010

Chisen Electric Corporation Index to Consolidated Financial Statements For the six months ended September 30, 2011

			Three months ended December 31						Nine months ended December 31
			2011			2010			2011			2010
	Note		US$’000			US$’000			US$’000			US$’000
Operating revenues:
Net sales to third parties				35,160			67,670			102,900			194,712

Cost of sales				(28,073	)		(59,200	)		(87,315	)		(170,460	)

Gross income				7,087			8,470			15,585			24,252

Operating expenses:
Sales, marketing and distribution				(2,390	)		(2,560	)		(7,031	)		(8,111	)
General and administrative				(2,812	)		(987	)		(6,597	)		(2,628	)

Operating income				1,885			4,923			1,957			13,513

Other income, net				418			276			619			889
Loss on disposal of scrap inventories				(6,092	)		(2,307	)		(6,092	)		(2,307	)
Provision for inventories				(5,431	)		-			(5,431	)		-
Interest income				479			117			1,184			315
Interest expense				(2,009	)		(940	)		(4,846	)		(2,231	)

(Loss) Income before income taxes				(10,750	)		2,069			(12,609	)		10,179

Income taxes benefit (expense)		4		434			(1,260	)		352			(2,421	)

(Loss) Income before extraordinary items				(10,316	)		809			(12,257	)		7,758

Extraordinary gain (less applicable income taxes of US$0)		19(a)		-			1,738			13,117			1,738
Extraordinary loss (less applicable income taxes of US$0)		19(b)		-			-			(1,848	)		-

Net (loss) income including non-controlling interests				(10,316	)		2,547			(988	)		9,496

Less: Net income attributable to non-controlling interests				(53	)		-			(64	)		-

Net (loss) income attributable to CIEC common stockholders				(10,369	)		2,547			(1,052	)		9,496

Amounts attributable to CIEC common stockholders

(Loss) Income before extraordinary item				(10,369	)		809			(12,321	)		7,758

Extraordinary gain				-			1,738			13,117			1,738
Extraordinary loss				-			-			(1,848	)		-

Net (loss) income attributable to CIEC common stockholders				(10,369	)		2,547			(1,052	)		9,496

Other comprehensive income
Foreign currency translation adjustment				256			561			1,297			1,115

Comprehensive (loss) income				(10,113	)		3,108			245			10,611

		Page
Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income		5 – 6
Unaudited Condensed Consolidated Balance Sheets		7 – 8
Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity		9
Unaudited Condensed Consolidated Statements of Cash Flows		10 – 11
Notes to and Forming Part of Unaudited Condensed Consolidated Financial Statements		12 – 26

The financial statements should be read in conjunction with the accompanying notes.

- 4 3-

Chisen Electric Corporation Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income For the ~~six~~nine months ended ~~September~~December 3031, 2011 and 2010

		Three months ended September 30								Six months ended September 30
				Three months ended December 31								Nine months ended December 31
		~~2011~~		2011		~~2010~~		2010		~~2011~~		2011		~~2010~~		2010
	Note	~~US$’000~~		Shares		~~US$’000~~		Shares		~~US$’000~~		Shares		~~US$’000~~		Shares
Operating revenues:
(Loss) Earnings per share	3
Net sales to third parties			36,422				76,613				71,821				127,042
Weighted average number of common stock outstanding - basic and diluted					500,000,000				500,000,000				500,000,000				500,000,000
Cost of sales			(29,859	)			(65,869	)			(63,323	)			(111,260	)
					US$				US$				US$				US$
Gross income			6,563				10,744				8,498				15,782
Net (loss) income per share of common stock outstanding before extraordinary items - basic and diluted					(0.021	)			0.002				(0.025	)			0.016
Operating expenses:
Net (loss) income per share of common stock outstanding after extraordinary items - basic and diluted					(0.021	)			0.005				(0.002	)			0.019
Sales, marketing and distribution			(2,121	)			(3,040	)			(4,641	)			(5,551	)
General and administrative			(2,080	)			(956	)			(3,785	)			(1,641	)
Operating income			2,362				6,748				72				8,590
Other income, net			213				110				201				613
Interest income			402				102				705				198
Interest expense			(1,555	)			(606	)			(2,837	)			(1,291	)
Income (Loss) before income taxes			1,422				6,354				(1,859	)			8,110
Income taxes expense	4		(531	)			(912	)			(82	)			(1,161	)
Income (Loss) before extraordinary items			891				5,442				(1,941	)			6,949
Extraordinary gain (less applicable income taxes of US$0)	19(a)		-				-				13,053				-
Extraordinary loss (less applicable income taxes of US$0)	19(b)		-				-				(1,840	)			-
Net income including non-controlling interests			891				5,442				9,272				6,949
Less: Net income attributable to non-controlling interests			(11	)			-				(11	)			-
Net income attributable to CIEC common stockholders			880				5,442				9,261				6,949
AMOUNTS ATTRIBUTABLE TO CIEC COMMON STOCKHOLDERS
Income (Loss) before extraordinary items			880				5,442				(1,952	)			6,949
Extraordinary gain (less applicable income taxes of US$0)			-				-				13,053				-
Extraordinary loss (less applicable income taxes of US$0)			-				-				(1,840	)			-
Net income attributable to CIEC common stockholders			880				5,442				9,261				6,949
Other comprehensive income
Foreign currency translation adjustment			625				433				1,041				554
Comprehensive income			1,505				5,875				10,302				7,503

The financial statements should be read in conjunction with the accompanying notes.

- 5 4-

Chisen Electric Corporation Unaudited Condensed Consolidated ~~Statements~~Balance ofSheets ~~Operations~~As ~~and~~of ~~Other~~December ~~Comprehensive~~31, ~~Income~~2011 ~~For~~and ~~the~~March ~~six months ended September 30~~31, 2011 ~~and 2010~~

			Three months ended September 30						Six months ended September 30
				As of December 31,			As of March 31,
			~~2011~~	2011		~~2010~~	2011		~~2011~~			~~2010~~
	Note		~~Shares~~	US$’000		~~Shares~~	US$’000		~~Shares~~			~~Shares~~
Earnings per share	3
ASSETS
Weight average number of common stock outstanding
Current assets:
- basic and diluted				50,000,000			50,000,000			50,000,000			50,000,000
Cash and cash equivalents					7,170			7,630
			US$			US$			US$			US$
Restricted bank balances		5			64,947			44,289
Net income (loss) per share of common stock outstanding before extraordinary items
Other financial assets		6			755			4,662
- basic and diluted				0.02			0.11			(0.04	)		0.14
Trade receivables, net					40,518			65,233
Net income per share of common stock outstanding after extraordinary items
Other receivables					8,699			4,618
- basic and diluted				0.02			0.11			0.19			0.14
Compensation receivable		19(a)			7,978			-
Prepayments					9,264			6,564
Due from a related party		14(b)			5			8
Inventories, net		7			22,615			25,173
Assets classified as held for sale					-			2,582
Deferred tax assets		4(c)			1,302			-
Total current assets					163,253			160,759
Available-for-sale financial assets		8			2,961			2,761
Long-term land lease prepayments, net		10			5,055			4,249
Property, plant and equipment, net		9			49,266			16,633
Deposit for acquisition of land and property, plant and equipment					8,259			3,838
Total assets					228,794			188,240

The financial statements should be read in conjunction with the accompanying notes.

- 6 5-

Chisen Electric Corporation Unaudited Condensed Consolidated Balance Sheets As of ~~September~~December 3031, 2011 and March 31, 2011

			As of September 30,			As of March 31,
				As of December 31,			As of March 31
			~~2011~~	2011		~~2011~~	2011
ASSETS	Note		US$’000			US$’000
	Note			US$’000			US$’000
Current assets:
LIABILITIES AND STOCKHOLDERS’ EQUITY
Cash and cash equivalents				4,948			7,630
Current liabilities:
Restricted bank balances	5			46,175			44,289
Trade payables					9,801			15,765
Other financial assets	6			4,038			4,662
Notes payable		11			13,224			48,640
Trade receivables, net				55,649			65,233
Accrued expenses and other accrued liabilities					20,311			11,065
Other receivables				4,758			4,618
Due to related parties		14(b)			3,356			4,126
Compensation receivable	19(a)			9,498			-
Income taxes payable					523			955
Prepayments				10,184			6,564
Short-term bank borrowings		12			139,512			65,159
Due from a related party	14(b)			8			8
Liabilities directly associated with assets classified as held for sale					-			1,109
Inventories	7			25,584			25,173
Total current liabilities					186,727			146,819
Assets classified as held for sale				-			2,582
Government subsidies		13			60			95
Deferred tax assets	4(c)			613			-
Deferred tax liabilities		4(c)			460			460
Total current assets				161,455			160,759
Total non-current liabilities					520			555
Available-for-sale financial assets	8			2,835			2,761
Total liabilities					187,247			147,374
Long-term land lease prepayments, net	10			5,051			4,249
Commitments and contingencies		15			-			-
Property, plant and equipment, net	9			32,283			16,633
Stockholders’ equity:
Deposit for acquisition of land and property, plant and equipment				2,861			3,838
Preferred stock, US$0.001 par value each:
Total assets				204,485			188,240
10,000,000 shares authorized and no shares issued and outstanding					-			-
Common stock, US$0.001 par value each:
1,000,000,000 shares authorized, 500,000,000 shares issued and outstanding as of December 31, 2011 and 50,000,000 shares issued and outstanding as of March 31, 2011					500			50
Capital reserves					144			144
Statutory reserves					4,142			3,704
Accumulated other comprehensive income					3,788			2,491
Retained earnings					32,441			34,381
Total CIEC stockholders’ equity					41,015			40,770
Non-controlling interests					532			96
Total stockholders’ equity					41,547			40,866
Total liabilities and stockholders’ equity					228,794			188,240

The financial statements should be read in conjunction with the accompanying notes.

- 7 6-

Chisen Electric Corporation Unaudited Condensed Consolidated ~~Balance~~Statements ~~Sheets~~of AsChanges ofin ~~September~~Stockholders' ~~30,~~Equity ~~2011~~For ~~and~~the ~~March~~nine months ended December 31, 2011

			As of September 30,			As of March 31
	Common stock issued										Accumulated other					Total CIEC			Non-		Total
			2011			2011
	Number of shares			Amount			Capital reserves		Statutory reserves		comprehensive income		Retained earnings			stockholders’ equity			controlling interests		stockholders’ equity
	Note		US$’000			US$’000
				US$’000			US$’000		US$’000		US$’000		US$’000			US$’000			US$’000		US$’000
LIABILITIES AND STOCKHOLDERS’ EQUITY
Balance as of April 1, 2011		50,000,000			50			144		3,704		2,491		34,381			40,770			96		40,866
Current liabilities:
Net income		-			-			-		-		-		(1,052	)		(1,052	)		64		(988	)
Trade payables				21,594			15,765
Forward stock split (Note)		450,000,000			450			-		-		-		(450	)		-			-		-
Notes payable	11			34,299			48,640
Transfer to statutory reserves		-			-			-		438		-		(438	)		-			-		-
Accrued expenses and other accrued liabilities				10,669			11,065
Foreign currency translation adjustment		-			-			-		-		1,297		-			1,297			-		1,297
Due to related parties	14(b)			2,209			4,126
Capital contributed by non-controlling interests		-			-			-		-		-		-			-			372		372
Income taxes payable				1,601			955
Balance as of December 31, 2011		500,000,000			500			144		4,142		3,788		32,441			41,015			532		41,547
Short-term bank borrowings	12			82,030			65,159
Liabilities directly associated with assets classified as held for sale				-			1,109
Total current liabilities				152,402			146,819
Government subsidies	13			72			95
Deferred tax liabilities	4(c)			460			460
Total non-current liabilities				532			555
Total liabilities				152,934			147,374
Commitments and contingencies	15			-			-
Stockholders’ equity:
Preferred stock, US$0.001 par value each:
10,000,000 shares authorized and no shares issued and outstanding				-			-
Common stock, US$0.001 par value each:
100,000,000 shares authorized
50,000,000 shares issued and outstanding				50			50
Capital reserves				144			144
Statutory reserves				4,762			3,704
Accumulated other comprehensive income				3,532			2,491
Retained earnings				42,584			34,381
Total CIEC stockholders’ equity				51,072			40,770
Non-controlling interests				479			96
Total stockholders’ equity				51,551			40,866
Total liabilities and stockholders’ equity				204,485			188,240

~~The financial statements should be read in conjunction with the accompanying notes.~~Note:

-In 8October 2011, the board of directors approved a 10-for-1 forward stock split of the common stock of the Company without changing its par value, which has become effective since November 22, 2011. The difference in value of common stock issued without changing the par value as a result of the forward stock split of US$450,000 has been debited to retained earnings.

~~Chisen~~The ~~Electric~~financial ~~Corporation~~statements ~~Unaudited~~should ~~Condensed~~be ~~Consolidated~~read ~~Statements of Changes~~ in ~~Stockholders'~~conjunction ~~Equity~~with ~~For~~ the ~~six~~accompanying ~~months ended September 30, 2011~~notes.

	Common stock issued								Accumulated
	Number of shares		Amount		Capital reserves		Statutory reserves		other comprehensive income		Retained earnings			Total CIEC stockholders’ equity		Non- controlling interests		Total stockholders’ equity
			US$’000		US$’000		US$’000		US$’000		US$’000			US$’000		US$’000		US$’000
Balance as of April 1, 2011		50,000,000		50		144		3,704		2,491		34,381			40,770		96		40,866
Net income		-		-		-		-		-		9,261			9,261		11		9,272
Transfer to statutory reserves		-		-		-		1,058		-		(1,058	)		-		-		-
Foreign currency translation adjustment		-		-		-		-		1,041		-			1,041		-		1,041
Capital contributed by non-controlling interests		-		-		-		-		-		-			-		372		372
Balance as of September 30, 2011		50,000,000		50		144		4,762		3,532		42,584			51,072		479		51,551

-7-

~~The~~Chisen ~~financial~~Electric ~~statements~~Corporation ~~should~~Unaudited beCondensed ~~read~~Consolidated inStatements ~~conjunction~~of ~~with~~Cash Flows For the ~~accompanying~~nine ~~notes.~~months ended December 31, 2011 and 2010

- 9 -

			Nine months ended December 31,
			2011			2010
	Note		US$’000			US$’000
Cash flows from operating activities
Net (loss) income				(988	)		9,496
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:
Depreciation of property, plant and equipment				1,412			807
Impairment loss on plant and machinery and leasehold improvement		19(b)		1,848			-
Net gain on disposal of land use rights and buildings		19(a)		(13,117	)		-
Loss on disposal of property, plant and equipment				-			18
Amortization of long-term land lease prepayments				71			12
Exchange differences				87			252
Provision for warranty costs				457			818
Government grant recognized				(38	)		(36	)
Provision for inventories				5,431			-
Deferred taxes				(1,302	)		-
Changes in assets and liabilities:
Other financial assets				4,052			1,718
Trade receivables, net				26,746			(17,812	)
Other receivables				(4,050	)		(7,080	)
Prepayment				(2,497	)		(2,034	)
Due from related parties				4			4
Inventories				(2,143	)		4,465
Trade payables				(6,453	)		(266	)
Notes payable				(36,931	)		12,553
Accrued expenses and other accrued liabilities				8,444			686
Due to related parties				(899	)		2,393
Income taxes payable				(461	)		958

Net cash (used in) provided by operating activities				(20,327	)		6,952

Cash flows from investing activities
Purchase of property, plant and equipment				(32,546	)		(3,396	)
Addition of long-term land lease prepayment				(745	)		-
Proceeds on disposal of property, plant and equipment				-			1
Compensation received for loss on plant and machinery and leasehold improvement				6,658			-
Investment in restricted bank balances, net				(19,279	)		(4,386	)
Deposit paid for acquisition of land and buildings				(7,146	)		(798	)
Acquisition of available-for-sale financial assets				-			(1,826	)

Net cash used in investing activities				(53,058	)		(10,405	)

~~Chisen~~The ~~Electric~~financial ~~Corporation~~statements ~~Unaudited~~should ~~Condensed~~be ~~Consolidated~~read ~~Statements~~in ofconjunction ~~Cash~~with ~~Flows For~~ the ~~six~~accompanying ~~months ended September 30, 2011 and 2010~~notes.

		Six months ended September 30,
		2011			2010
	Note	US$’000			US$’000
Cash flows from operating activities
Net income			9,272			6,949
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation of property, plant and equipment			542			540
Impairment loss on plant and machinery and leasehold improvement	19(b)		1,840			-
Net compensation gain on disposal of land use rights and buildings	19(a)		(13,053	)		-
Loss on disposal of property, plant and equipment			-			18
Amortization of long-term land lease prepayments			46			8
Exchange differences			21			68
Provision for warranty costs			224			549
Government grant recognized			(25	)		(24	)
Reversal of provision for inventories			(188	)		-
Deferred taxes			(613	)		-
Changes in assets and liabilities:
Other financial assets			741			4,443
Trade receivables, net			11,234			(17,570	)
Other receivables			(24	)		(171	)
Prepayment			(3,455	)		2,826
Due from related parties			1			3
Inventories			415			5,979
Trade payables			5,430			(208	)
Notes payable			(15,572	)		4,925
Accrued expenses and other accrued liabilities			(901	)		1,467
Due to related parties			(2,022	)		1,551
Income taxes payable			622			771
Net cash (used in) provided by operating activities			(5,465	)		12,124
Cash flows from investing activities
Purchase of property, plant and equipment			(16,559	)		(1,685	)
Addition of long-term land lease prepayment			(741	)		-
Proceeds on disposal of property, plant and equipment			-			1
Compensation received for loss on plant and machinery and leasehold improvement			5,065			-
Investment in restricted bank balances, net			(765	)		149
Deposit paid for acquisition of land and buildings			-			(788	)
Acquisition of available-for-sale financial assets			-			(1,802	)
Net cash used in investing activities			(13,000	)		(4,125	)

-8-

- 10 -

	Nine months ended December 31,
	2011			2010
	US$’000			US$’000
Cash flows from financing activities
Proceeds from short-term bank loans		42,662			14,368
Repayment of short-term bank loans		(31,721	)		(10,209	)
Proceeds from bills financing		91,686			3,025
Repayment of bills financing		(30,304	)		(3,781	)
Capital contributed by non-controlling interest		372			88

Net cash provided by financing activities		72,695			3,491

Net (decrease) increase in cash and cash equivalents		(690	)		38

Cash and cash equivalents, beginning of period		7,630			6,019

Effect on exchange rate changes		230			180

Cash and cash equivalents, end of period		7,170			6,237

Supplemental disclosure of cash flow information
Interest received		1,184			315
Interest paid		5,271			2,186
Tax paid		1,382			1,458

	Six months ended September 30,
	2011			2010
	US$’000			US$’000
Cash flows from financing activities
Proceeds from short-term bank loans		21,680			6,417
Repayment of short-term bank loans		(17,688	)		(8,282	)
Proceeds from bills financing		41,363			-
Repayment of bills financing		(30,132	)		(3,731	)
Capital contributed by non-controlling interest		372			88
Net cash provided by (used in) financing activities		15,595			(5,508	)
Net (decrease) increase in cash and cash equivalents		(2,870	)		2,491
Cash and cash equivalents, beginning of period		7,630			6,019
Effect on exchange rate changes		188			102
Cash and cash equivalents, end of period		4,948			8,612
Supplemental disclosure of cash flow information
Interest received		705			198
Interest paid		2,280			1,268
Tax paid		80			400

-9-

~~The~~Chisen ~~financial~~Electric ~~statements~~Corporation ~~should~~Notes beto ~~read~~and inForming ~~conjunction~~Part ~~with~~of Unaudited Condensed Consolidated Financial Statements For the ~~accompanying~~nine ~~notes.~~months ended December 31, 2011 and 2010

-1. 11ORGANIZATION -AND PRINCIPAL ACTIVITIES

Chisen Electric Corporation ~~Notes~~(“Chisen Electric”), toformerly ~~and~~known ~~Forming~~as ~~Part~~World ofTrophy ~~Unaudited~~Oufitters, ~~Condensed~~Inc., ~~Consolidated~~was ~~Financial~~formed ~~Statements~~as ~~For~~a ~~the~~Nevada ~~six~~corporation ~~months~~on ~~ended~~January ~~September 30~~13, ~~2011~~2005. ~~and~~Its ~~2010~~common stocks are currently trading on the Over-The-Counter Quote Board under the symbol “CIEC”.

1Chisen Electric is an investment holding company with no operations. ~~ORGANIZATION~~The ~~AND~~principal ~~PRINCIPAL~~activities ~~ACTIVITIES~~of its subsidiaries (together with Chisen Electric, collectively referred as “the Company”) are the manufacture and sales of sealed lead-acid battery products and investment holding.

As of May 27, 2011, Chisen Electric has fully disposed of its interest in Chisen Technology Holdings Corporation (“Chisen ~~Electric~~Technology”), ~~formerly~~for ~~known~~a ascash ~~World~~consideration of ~~Trophy~~US$10. ~~Oufitters,~~Chisen ~~Inc~~Technology has no operation since the date of incorporation., ~~was~~The ~~formed~~fair asvalue aof ~~Nevada~~Chisen ~~corporation~~Technology onat ~~January~~the ~~13,~~date ~~2005~~of disposal was net liabilities of US$496. ~~Its~~The ~~common~~disposal ~~stocks~~of ~~are~~Chisen ~~currently~~Technology ~~trading~~has no significant impact on the ~~Over-The-Counter~~value ~~Quote~~of ~~Board~~the ~~under~~Company’s assets, ~~the~~operating ~~symbol~~cash ~~“CIEC”~~flows as well as earnings per share.

~~Chisen~~Details ~~Electric is an investment holding company with no operations. The principal activities~~ of ~~its subsidiaries (together with~~ Chisen Electric,’s subsidiaries ~~collectively referred~~ as ~~“the Company”) are the manufacture and sales~~ of ~~sealed~~December ~~lead-acid~~31, ~~battery~~2011 ~~products~~are ~~and~~as ~~investment holding.~~follows:

As of May 27, 2011, Chisen Electric has fully disposed of its interest in Chisen Technology Holdings Corporation (“Chisen Technology”) for a cash consideration of US$10. Chisen Technology has no operation since the date of incorporation. The fair value of Chisen Technology at the date of disposal was net liabilities of US$496. The disposal of Chisen Technology has no significant impact on the value of the Company’s assets, operating cash flows as well as earnings per share.

Name	Place and date of establishment / incorporation	Percentage of effective equity interest / voting right attributable to the Company	Principal activities

Fast More Limited (“Fast More”)	Hong Kong December 17, 2007	100%	Investment holding

Zhejiang Chisen Electric Co., Limited * (“Zhejiang Chisen”) (Formerly known as Changxing Chisen Electric Co., Limited)	Zhejiang, the People’s Republic of China (“PRC”) February 25, 2002	100%	Manufacture and sales of sealed lead-acid battery products

Chisen Electric Jiangsu Co., Limited * (“Chisen Jiangsu”)	Jiangsu, PRC August 23, 2010	98%	Manufacture and sales of sealed lead-acid battery products

~~Details~~* These are direct translation of ~~Chisen~~the ~~Electric’s~~name ~~subsidiaries~~in asChinese offor ~~September~~identification ~~30,~~purpose ~~2011~~only and are asnot ~~follows:~~the official name in English.

Name	Place and date of establishment / incorporation	Percentage of effective equity interest / voting right attributable to the Company	Principal activities
Fast More Limited (“Fast More”)	Hong Kong December 17, 2007	100%	Investment holding
Zhejiang Chisen Electric Co., Limited * (“Zhejiang Chisen”) (Formerly known as Changxing Chisen Electric Co., Limited)	Zhejiang, the People’s Republic of China (“PRC”) February 25, 2002	100%	Manufacture and sales of sealed lead-acid battery products
Chisen Electric Jiangsu Co., Limited * (“Chisen Jiangsu”)	Jiangsu, PRC August 23, 2010	98%	Manufacture and sales of sealed lead-acid battery products

-10-

*Chisen ~~These~~Electric ~~are~~Corporation ~~direct~~Notes ~~translation~~to ofand ~~the~~Forming ~~name~~Part inof ~~Chinese~~Unaudited ~~for~~Condensed ~~identification~~Consolidated ~~purpose~~Financial ~~only~~Statements ~~and~~For ~~are~~the ~~not~~nine ~~the~~months ~~official~~ended ~~name~~December in31, ~~English.~~2011 and 2010

-2. 12SUMMARY -OF SIGNIFICANT ACCOUNTING POLICIES

~~Chisen~~Basis ~~Electric Corporation Notes to and Forming Part~~ of ~~Unaudited Condensed Consolidated Financial Statements For the six months ended September 30, 2011 and 2010~~presentations

2The accompanying unaudited condensed consolidated financial statements as of December 31, 2011 have been prepared based upon Securities and Exchange Commission rules that permit reduced disclosure for interim periods and include, in the opinion of management, all adjustments (consisting of normal recurring adjustments and reclassifications) necessary to present fairly the financial position, results of operations and cash flows as of December 31, 2011 and for all periods presented. ~~SUMMARY~~Information OFas ~~SIGNIFICANT~~of ~~ACCOUNTING~~March ~~POLICIES~~31, 2011 was derived from the audited consolidated financial statements of the Company for the year ended March 31, 2011.

~~Basis~~Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States of ~~presentations~~America (“USGAAP”) have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Chisen Electric's Form 10-K filed on June 14, 2011 for the year ended March 31, 2011. The results of operations for both the three months and nine months ended December 31, 2011 are not necessarily indicative of the operating results to be expected for the full year ending March 31, 2012.

The ~~accompanying unaudited~~ condensed consolidated financial statements ~~as of September 30, 2011 have been prepared based upon Securities~~ and ~~Exchange~~accompanying ~~Commission~~notes ~~rules~~are ~~that~~presented ~~permit~~in ~~reduced~~United ~~disclosure~~States ~~for~~dollars ~~interim periods~~ and ~~include,~~prepared in ~~the~~conformity ~~opinion~~with ofUSGAAP which requires management, ~~all~~to ~~adjustments~~make ~~(consisting~~certain ofestimates ~~normal recurring adjustments~~ and ~~reclassifications)~~assumptions ~~necessary~~that toaffect ~~present fairly~~ the ~~financial~~reported ~~position,~~amounts ~~results~~ of ~~operations~~assets and ~~cash~~liabilities ~~flows~~and as disclosure of ~~September~~contingent ~~30,~~assets ~~2011~~ and ~~for~~liabilities ~~all~~at ~~periods~~the ~~presented.~~date ~~Information as~~ of ~~March~~financial ~~31,~~statements ~~2011~~and ~~was derived from~~ the ~~audited~~reported ~~consolidated~~amounts ~~financial~~of ~~statements~~revenues ofand expenses during the ~~Company~~reporting ~~for~~period. ~~the~~Actual ~~year~~results ~~ended~~could ~~March~~differ ~~31,~~from ~~2011~~those estimates.

~~Certain~~Basis ~~information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States~~ of America (“USGAAP”) have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Chisen Electric's Form 10-K filed on June 14, 2011 for the year ended March 31, 2011. The results of operations for both the three months and six months ended September 30, 2011 are not necessarily indicative of the operating results to be expected for the full year ending March 31, 2012. consolidation

The ~~condensed~~ consolidated financial statements include ~~and accompanying notes are presented in United States dollars and prepared in conformity with USGAAP which requires management to make certain estimates and assumptions that affect~~ the ~~reported~~financial ~~amounts~~information of ~~assets~~Chisen ~~and~~Electric ~~liabilities~~ and ~~disclosure~~its ofsubsidiaries. ~~contingent~~All ~~assets~~significant ~~and~~intercompany ~~liabilities~~accounts ~~at the date of financial statements~~ and ~~the~~transactions have ~~reported~~been ~~amounts~~eliminated ofupon ~~revenues and expenses during the reporting period~~consolidation. ~~Actual results could differ from those estimates.~~

~~Basis~~Recent ofaccounting ~~consolidation~~pronouncement

In December 2011, the Financial Accounting Standard Board (“FASB”) issued Accounting Standards Update (ASU) 2011-11, “Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities”. The ~~consolidated~~amendments in this ASU require an entity to disclose information about offsetting and related arrangements on its financial ~~statements~~position. ~~include~~This includes the ~~financial~~effect ~~information~~or potential effect of ~~Chisen~~rights ~~Electric~~of offset associated with an entity’s recognized assets and ~~its~~recognized ~~subsidiaries~~liabilities and require improved information about financial instruments and derivative instruments that are either (1) offset in accordance with Section 210-20-45 or Section 815-10-45 or (2) subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are offset in accordance with Section 210-20-45 or Section 915-10-45. ~~All~~The ~~significant~~amendments ~~intercompany~~are ~~accounts~~effective for annual reporting periods beginning on or after January 1, 2013 and ~~transactions~~retrospective disclosure is required for all comparative periods presented. No early adoption is permitted. The Company believes that the adoption of ASU 2011-11 will not have ~~been~~any ~~eliminated~~impact ~~upon~~on ~~consolidation~~the Company's consolidated results of operation and financial condition.

~~Recent accounting pronouncement~~-11-

InChisen ~~September~~Electric ~~2011,~~Corporation ~~the~~Notes ~~Financial~~to ~~Accounting Standard Board (“FASB”) issued Accounting Standards Update (“ASU”) 2011-08, “Intangibles – Goodwill~~ and ~~Other~~Forming ~~(Topic~~Part ~~350): Testing goodwill for impairment”. This ASU permits an entity to first assess qualitative factors to determine whether it is more likely than not that the fair value~~ of aUnaudited ~~reporting~~Condensed ~~unit~~Consolidated isFinancial ~~less~~Statements ~~than~~For ~~its carrying amount as a basis for determining whether it is necessary to perform~~ the ~~two-step~~nine ~~goodwill~~months ~~impairment~~ended test. The more-likely-than-not threshold is defined as having a likelihood of more than 50 percent. Under ASU 2011-08, an entity is not required to calculate the fair value of a reporting unit unless the entity determines that it is more likely than not that its fair value is less than its carrying amount. ASU 2011-08 is effective for annual periods beginning after December 1531, 2011. ~~The Company believes that the adoption of ASU 2011-08 will not have any material impact on the Company's consolidated results of operation~~ and ~~financial condition.~~ 2010

-3. 13(LOSS) -EARNINGS PER SHARE

~~Chisen~~Basic (loss) ~~Electric~~earnings ~~Corporation~~per ~~Notes~~share is computed by dividing (loss) income available to ~~and~~common ~~Forming~~stockholders ~~Part~~by the weighted-average number of ~~Unaudited~~common ~~Condensed~~stocks ~~Consolidated~~outstanding ~~Financial~~during ~~Statements~~the ~~For~~period. Diluted (loss) earnings per share is computed similar to basic earnings per share except that the ~~six~~denominator is increased to include the number of additional common stocks that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. There were no potentially dilutive securities for both the three months and nine months ended ~~September~~December 3031, 2011 and 2010. As a result of a forward stock split, the calculation of basic and diluted (loss) earnings per common stock for all periods presented are adjusted retrospectively.

34. ~~EARNINGS~~INCOME ~~PER SHARE~~TAXES

~~Basic~~Chisen ~~earnings~~Electric ~~per~~had ~~share~~a isnet ~~computed~~operating loss bycarry-forward ~~dividing~~for income ~~available~~tax toreporting ~~common~~purposes ~~stockholders~~that bymight ~~the~~be ~~weighted-average~~offset ~~number~~against offuture ~~common~~taxable ~~stocks outstanding during the year~~income. ~~Diluted~~No ~~earnings~~tax ~~per~~benefit ~~share~~has isbeen reported ~~computed~~in ~~similar~~the tofinancial ~~basic~~statements, ~~earnings~~because ~~per~~Chisen ~~share~~Electric ~~except~~believes that ~~the~~it ~~denominator~~ is ~~increased~~more tolikely ~~include~~than ~~the~~not ~~number of additional common stocks~~ that ~~would have been outstanding if~~ the ~~potential~~carry-forwards will ~~common~~finally ~~shares~~expire ~~had been issued~~ and iftherefore ~~the~~cannot ~~additional~~be ~~common shares were dilutive~~used. ~~There~~Accordingly, ~~were~~the nopotential ~~potentially~~tax ~~dilutive~~benefits ~~securities~~of ~~for both~~ the ~~three~~loss ~~months~~carry-forwards ~~and~~are ~~six~~offset by ~~months~~a ~~ended~~valuation ~~September~~allowance ~~30,~~of ~~2011~~the ~~and~~same ~~2010~~amount.

4.Chisen ~~INCOME~~Electric’s ~~TAXES~~subsidiaries are subject to income taxes on an entity basis on income arising in or derived from the tax jurisdictions in which each entity domiciles and operates.

~~Chisen~~Hong ~~Electric~~Kong ~~had~~Profits aTax ~~net operating loss carry-forward for income tax reporting purposes that might be offset against future taxable income. No tax benefit~~ has ~~been reported in the financial statements, because Chisen Electric believes that it is more likely than~~ not ~~that~~been provided ~~the~~as ~~carry-forwards~~Fast ~~will~~More ~~finally~~had ~~expire~~no ~~and~~assessable ~~therefore~~profit ~~cannot~~for ~~be used. Accordingly,~~ the ~~potential tax benefits of the loss carry-forwards are offset by a valuation allowance of the same amount~~period.

Zhejiang Chisen ~~Electric’s~~and ~~subsidiaries~~Chisen Jiangsu are subject to state and local enterprise income taxes onin anthe ~~entity~~PRC ~~basis~~at ona ~~income~~standard ~~arising~~rate inof or25%. ~~derived~~Since ~~from~~January 1, 2011, Zhejiang Chisen has been designated by the local tax ~~jurisdictions~~authority inas ~~which~~“New ~~each~~and ~~entity~~High ~~domiciles~~Technology ~~and~~Enterprises”. ~~operates~~As a result, the effective tax rate applicable to Zhejiang Chisen was 15% commencing on January 1, 2011.

Dividends payable by a foreign invested enterprise in the PRC to its foreign investors in Hong Kong ~~Profits~~are ~~Tax~~subject ~~has~~to ~~not~~a ~~been~~10% ~~provided~~withholding astax. ~~Fast~~No ~~More~~deferred ~~had~~tax noexpenses ~~assessable~~on ~~profit~~undistributed profits were charged to the statement of operations for both the ~~period~~three months and nine months ended December 31, 2011 and 2010.

~~Zhejiang~~As ~~Chisen~~of ~~and~~December ~~Chisen~~31, ~~Jiangsu~~2011, ~~are subject to state and local enterprise income taxes in~~ the ~~PRC~~Company has atestimated aunused ~~standard~~tax ~~rate~~losses of ~~25%.~~approximately ~~Since January 1~~US$8, ~~2011~~700,000 ~~Zhejiang~~(2010: ~~Chisen~~US$Nil) ~~has~~available ~~been~~for ~~designated~~offset byagainst ~~the~~future ~~local~~profits. Deferred tax ~~authority~~benefits asof ~~“New~~US$689,000 (2010: US$Nil) and ~~High~~US$1,302,000 ~~Technology~~(2010: ~~Enterprises”.~~US$Nil) Aswere acredited ~~result,~~to the ~~effective~~statement of ~~tax~~operations ~~rate~~for ~~applicable~~the tothree ~~Zhejiang~~months ~~Chisen~~and ~~was~~nine ~~15%~~months ~~commencing~~ended onDecember ~~January 1~~31, 2011.

Dividends payable by a foreign invested enterprise in the PRC to its foreign investors in Hong Kong are subject to a 10% withholding tax. No deferred tax expenses on undistributed profits were charged to the statement of operations for both the three months and six months ended September 30, 2011 and 2010.-12-

-Chisen 14Electric -Corporation Notes to and Forming Part of Unaudited Condensed Consolidated Financial Statements For the nine months ended December 31, 2011 and 2010

~~Chisen~~4. ~~Electric~~INCOME ~~Corporation~~TAXES ~~Notes to and Forming Part of Unaudited Condensed Consolidated Financial Statements For the six months ended September 30, 2011 and 2010~~(CONTINUED)

4.(a) ~~INCOME~~Income ~~TAXES~~tax (~~CONTINUED~~benefits) expenses are comprised of the following:

(a) Income tax (benefits) expenses are comprised of the following:

	Three months ended December 31,					Nine months ended December 31,
	2011			2010		2011			2010
	US$’000			US$’000		US$’000			US$’000

Current taxes arising in the PRC:
Corporate income tax		255			322		950			1,483
Withholding tax on dividends declared by the PRC foreign investment enterprise		-			938		-			938

		255			1,260		950			2,421

Deferred taxes arising in the PRC:
Benefit of tax loss recognized		(689	)		-		(1,302	)		-

		(434	)		1,260		(352	)		2,421

	Three months ended September 30,					Six months ended September 30,
	2011			2010		2011			2010
	US$’000			US$’000		US$’000			US$’000
Current taxes arising in the PRC:Corporate income tax		660			912		695			1,161
Deferred taxes arising in the PRC:Benefit of tax loss recognized		(129	)		-		(613	)		-
		531			912		82			1,161

The FASB ASC Topic 740 “Income Taxes” clarifies the accounting and disclosure for uncertainty in tax positions, as defined, and prescribes the measurement process and a minimum recognition threshold for a tax position, taken or expected to be taken in a tax return, that is required to be met before being recognized in the financial statements. Under ASC 740, the Company must recognize the tax benefit from an uncertain position only if it is more-likely-than-not the tax position will be sustained on examination by the tax authority, based on the technical merits of the position. The tax benefits recognized in the financial statements attributable to such position are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon the ultimate resolution of the position.

~~The~~Subject ~~FASB~~to ~~ASC~~the ~~Topic~~provision of ASC 740, ~~“Income Taxes” clarifies~~ the ~~accounting~~Company ~~and~~has ~~disclosure~~analyzed ~~for~~its ~~uncertainty~~filing ~~in tax~~ positions, asin ~~defined,~~all ~~and~~of ~~prescribes~~ the ~~measurement~~jurisdictions ~~process~~where ~~and~~it ~~a minimum recognition threshold for a tax position, taken or expected to be taken in a tax return, that~~ is required to befile ~~met~~income ~~before~~tax ~~being~~returns. As ~~recognized~~of inDecember ~~the~~31, ~~financial~~2011 ~~statements.~~and ~~Under~~March ~~ASC~~31, ~~740~~2011, the Company ~~must~~has ~~recognize~~identified the ~~tax~~following ~~benefit~~jurisdictions ~~from~~as an“major” ~~uncertain~~tax ~~position~~jurisdictions, as ~~only~~defined, ifin which it is ~~more-likely-than-not~~required ~~the~~to ~~tax~~file ~~position~~income ~~will~~tax bereturns ~~sustained~~namely ~~on examination by~~ the ~~tax~~United ~~authority~~States, ~~based~~Hong onKong ~~the~~and ~~technical merits of~~ the ~~position~~PRC. ~~The~~Based ~~tax~~on ~~benefits recognized in~~ the ~~financial~~evaluations noted ~~statements~~above, ~~attributable to such position are measured based on~~ the ~~largest~~Company ~~benefit that~~ has aconcluded ~~greater~~that ~~than~~there ~~50%~~are ~~likelihood~~no ofsignificant ~~being~~uncertain ~~realized~~tax ~~upon~~positions ~~the~~requiring ~~ultimate~~recognition ~~resolution~~in ofits ~~the~~consolidated financial ~~position~~statements.

~~Subject to the provision of ASC 740, the Company has analyzed its filing positions in all of the jurisdictions where it is required to file income tax returns.~~ As of ~~September~~December 3031, 2011 and March 31, 2011, the Company ~~has~~had ~~identified~~no ~~the~~unrecognized ~~following~~tax ~~jurisdictions~~benefits asor ~~“major”~~accruals ~~tax~~for ~~jurisdictions,~~the aspotential ~~defined,~~payment inof interest ~~which~~and itpenalties. isThe ~~required~~Company’s policy is to ~~file~~record ~~income~~interest ~~tax~~and ~~returns~~penalties ~~namely~~in ~~the~~this ~~United~~connection ~~States,~~as ~~Hong~~a ~~Kong~~component ~~and~~of the provision ~~PRC.~~for ~~Based~~income ontax ~~the~~expense. ~~evaluations~~For ~~noted~~both ~~above,~~ the ~~Company~~three ~~has~~months ~~concluded~~and ~~that~~nine ~~there~~months ~~are~~ended noDecember 31, ~~significant~~2011 ~~uncertain~~and ~~tax~~2010, ~~positions~~no ~~requiring~~interest ~~recognition~~or inpenalties ~~its~~were ~~consolidated financial statements~~recorded.

As of September 30, 2011 and March 31, 2011, the Company had no unrecognized tax benefits or accruals for the potential payment of interest and penalties. The Company’s policy is to record interest and penalties in this connection as a component of the provision for income tax expense. For both the three months and six months ended September 30, 2011 and 2010, no interest or penalties were recorded.-13-

-Chisen 15Electric -Corporation Notes to and Forming Part of Unaudited Condensed Consolidated Financial Statements For the nine months ended December 31, 2011 and 2010

4.(b) ~~INCOME~~Reconciliation ~~TAXES~~from the expected income tax expenses calculated with reference to the statutory tax rate in the PRC of 25% (~~CONTINUED~~2010: 25%) is as follows:

(b) Reconciliation from the expected income tax expenses calculated with reference to the statutory tax rate in the PRC of 25% (2010: 25%) is as follows:

	Three months ended December 31,						Nine months ended December 31,
	2011			2010			2011			2010
	US$’000			US$’000			US$’000			US$’000

Expected income tax expenses		(2,687	)		517			(3,152	)		2,545
Effect on tax incentives / holiday		446			(259	)		861			(1,273	)
Withholding tax		-			938			-			938
Non-deductible items		2,564			-			2,564			-
Non-taxable income		-			-			-			(34	)
Others		(757	)		64			(625	)		245

Income tax (benefits) expenses		(434	)		1,260			(352	)		2,421

	Three months ended September 30,					Six months ended September 30,
	2011		2010			2011			2010
	US$’000		US$’000			US$’000			US$’000
Expected income tax expenses		355		1,588			(465	)		2,027
Effect on tax incentives / holiday		93		(794	)		415			(996	)
Non-taxable income		-		-			-			(34	)
Others		83		118			132			164
Income tax expenses		531		912			82			1,161

(c)

The following is the analysis of major deferred taxation (liabilities) assets recognized by the Company and movement thereon:

(c) The following is the analysis of major deferred taxation (liabilities) assets recognized by the Company and movement thereon:

	Withholding tax on undistributed earnings of a PRC subsidiary			Tax loss of a PRC subsidiary		Total
	US$’000			US$’000		US$’000

As of March 31, 2011 and 2010		(460	)		-		(460	)
Credited to consolidated statement of operations and other comprehensive income		-			1,302		1,302

As of December 31, 2011		(460	)		1,302		842

	Withholding tax on undistributed earnings of a PRC subsidiary			Tax loss of a PRC subsidiary		Total
	US$’000			US$’000		US$’000
As of March 31, 2011 and 2010		(460	)		-		(460	)
Credited to consolidated statement of operations and other comprehensive income		-			613		613
As of September 30, 2011		(460	)		613		153

-14-

-Chisen 16Electric -Corporation Notes to and Forming Part of Unaudited Condensed Consolidated Financial Statements For the nine months ended December 31, 2011 and 2010

~~Chisen~~5. ~~Electric~~RESTRICTED ~~Corporation~~BANK ~~Notes to and Forming Part of Unaudited Condensed Consolidated Financial Statements For the six months ended September 30, 2011 and 2010~~BALANCES

5.Restricted ~~RESTRICTED~~bank ~~BANK~~balances ~~BALANCES~~represented time deposits with original maturity within nine months to secure banking facilities granted by various financial institutions as follows:

Restricted bank balances represented time deposits with original maturity within six months to secure banking facilities granted by various financial institutions as follows:

			As of December 31,		As of March 31,
	Note		2011		2011
			US$’000		US$’000

Notes payable		11		21,427		30,167
Bills financing		12		38,797		14,122
Short-term bank loans		12		4,723		-

				64,947		44,289

		As of September 30,		As of March 31,
	Note	2011		2011
		US$’000		US$’000
Notes payable	11		31,479		30,167
Bills financing	12		14,696		14,122
			46,175		44,289

OTHER FINANCIAL ASSETS

Other financial assets represented notes receivable from customers for the settlement of trade receivable balances. As of December 31, 2011 and March 31, 2011, all notes receivable were guaranteed by established banks in the PRC and had maturities of 6 months or less from the date of issue. ~~OTHER~~The ~~FINANCIAL~~fair ~~ASSETS~~value of the notes receivable approximated their carrying value.

~~Other financial assets represented notes receivable from customers for the settlement of trade receivable balances~~7. ~~As of September 30~~INVENTORIES, 2011 and March 31, 2011, all notes receivable were guaranteed by established banks in the PRC and had maturities of 6 months or less from the date of issue. The fair value of the notes receivable approximated their carrying value. NET

7.Inventories ~~INVENTORIES~~consisted of the following:

Inventories consisted of the following:

	As of December 31,			As of March 31,
	2011			2011
	US$’000			US$’000

Raw materials		3,621			3,669
Work-in-progress and semi-finished goods		11,790			7,473
Finished goods		12,690			14,031
		28,101			25,173
Provision for slow-moving and obsolete items		(5,486	)		-

		22,615			25,173

	As of September 30,		As of March 31,
	2011		2011
	US$’000		US$’000
Raw materials		3,038		3,669
Work-in-progress and semi-finished goods		7,338		7,473
Finished goods		15,208		14,031
		25,584		25,173

8.	AVAILABLE-FOR-SALE FINANCIAL ASSETS

~~8. AVAILABLE~~Available-~~FOR~~for-~~SALE~~sale ~~FINANCIAL~~financial ~~ASSETS~~assets as of December 31, 2011 and March 31, 2011 represented investment in unlisted equity securities and are recorded at cost. The management has estimated that the recoverable amount of the assets exceed their carrying value.

~~Available~~-~~for~~15-sale financial assets as of September 30, 2011 and March 31, 2011 represented investment in unlisted equity securities and are recorded at cost. The management has estimated that the recoverable amount of the assets exceed their carrying value.

-Chisen 17Electric -Corporation Notes to and Forming Part of Unaudited Condensed Consolidated Financial Statements For the nine months ended December 31, 2011 and 2010

~~Chisen~~9. ~~Electric~~PROPERTY, ~~Corporation~~PLANT ~~Notes~~AND ~~to and Forming Part of Unaudited Condensed Consolidated Financial Statements For the six months ended September 30~~EQUIPMENT, ~~2011 and 2010~~NET

~~9. PROPERTY~~Property, ~~PLANT~~plant ~~AND~~and ~~EQUIPMENT,~~equipment ~~NET~~is summarized as follows:

Property, plant and equipment is summarized as follows:

	As of December 31,			As of March 31,
	2011			2011
	US$’000			US$’000

Buildings		12,994			3,001
Leasehold improvements		1,421			1,016
Plant and machinery		19,323			4,638
Motor vehicles		1,548			1,398
Furniture, fixtures and office equipment		4,233			1,743
Construction in progress		15,179			6,939

		54,698			18,735

Accumulated depreciation and impairment loss		(5,432	)		(2,102	)

		49,266			16,633

	As of September 30,			As of March 31,
	2011			2011
	US$’000			US$’000
Buildings		14,897			3,001
Leasehold improvements		1,332			1,016
Plant and machinery		11,274			4,638
Motor vehicles		1,492			1,398
Furniture, fixtures and office equipment		2,583			1,743
Construction in progress		5,264			6,939
		36,842			18,735
Accumulated depreciation and impairment loss		(4,559	)		(2,102	)
		32,283			16,633

Depreciation expenses were approximately US$1,173,000 and US$267,000 for the three months ended December 31, 2011 and 2010, respectively, and US$1,412,000 and US$807,000 for the nine months ended December 31, 2011 and 2010, respectively.

~~Depreciation~~During ~~expenses~~the ~~were~~period ~~approximately~~ended ~~US$238~~December 31,~~000~~ ~~and US$288~~2011,~~000~~ ~~for~~the Company was advised by the ~~three~~local ~~months~~authority ~~ended~~in ~~September~~Changxing ~~30,~~that ~~2011~~the ~~and~~original ~~2010~~production technique, ~~respectively~~external battery formation, can no longer be used after October 31, 2012. Some of the Company’s machinery and equipment cannot be used under the tightened policy. Management revised the estimated remaining useful life of those machinery and equipment to 10 months. This change of accounting estimate increased cost of sales and net losses by US$~~542~~452,000 and increased the losses per share by US$~~540,000~~ 0.001 for the ~~six~~three and nine months ended ~~September~~December 3031, 2011 ~~and 2010 respectively~~.

10.

LONG-TERM LAND LEASE PREPAYMENTS, NET

			As of September 30,				As of March 31,
		As of December 31,				As of March 31,
		2011	~~2011~~			2011	~~2011~~
		US$’000	~~US$’000~~			US$’000	~~US$’000~~
Prepaid land use rights	~~Prepaid land use rights~~		5,130	~~5,101~~			4,252	~~4,252~~
Accumulated amortization	~~Accumulated amortization~~		(75	~~(50~~)	)		(3	(3)	)
				5,051				4,249
			5,055				4,249

~~Lease prepayment as of September 30, 2011 and March 31, 2011 represented the land use rights located in the PRC, which are amortized over the leasehold periods.~~-16-

~~Amortization~~Chisen ~~expense~~Electric ~~for~~Corporation ~~the~~Notes ~~three~~to ~~months period ended September 30, 2011~~ and ~~2010~~Forming ~~were~~Part ~~US$22,000~~of ~~and~~Unaudited ~~US$4,000~~Condensed ~~respectively,~~Consolidated ~~and~~Financial ~~US$46,000~~Statements ~~and~~For ~~US$8,000 for~~ the ~~six~~nine months ended ~~September~~December 3031, 2011 and 2010 ~~respectively.~~

10. LONG-TERM 18LAND -LEASE PREPAYMENTS, NET (CONTINUED)

~~Chisen~~Lease ~~Electric~~prepayment ~~Corporation~~as ~~Notes~~of toDecember 31, 2011 and ~~Forming~~March ~~Part~~31, of2011 ~~Unaudited~~represented ~~Condensed~~the ~~Consolidated~~land ~~Financial~~use ~~Statements~~rights ~~For~~located in the ~~six~~PRC, ~~months~~which ~~ended~~are ~~September~~amortized ~~30,~~over ~~2011~~the ~~and~~leasehold ~~2010~~periods.

~~11.~~Amortization ~~NOTES~~expense ~~PAYABLE~~for the three months period ended December 31, 2011 and 2010 were US$25,000 and US$4,000, respectively, and US$71,000 and US$12,000 for the nine months ended December 31, 2011 and 2010, respectively.

~~Notes payable were issued by the Company to creditors with the banker’s acceptance payable at the maturity date for the purchase of raw materials for production exclusively~~11. ~~The~~NOTES Company has to repay the notes within nine months from date of issuance and service fees would be charged by banks for the issuance of the notes. The notes payable were collateralized by restricted bank balances and a long-term land lease prepayment with carrying amount of US$760,000 as of September 30, 2011 (as of March 31, 2011: US$Nil).PAYABLE

InNotes ~~addition,~~payable ~~various~~were ~~parties~~issued ~~have~~by ~~issued~~the Company ~~guarantee~~to ~~against~~creditors ~~these~~with the banker’s acceptance payable at the maturity date for the purchase of raw materials for production exclusively. The Company has to repay the notes within nine months from date of issuance and service fees would be charged by banks for the issuance of the notes. The notes payable were collateralized by restricted bank balances and a long-term land lease prepayment with carrying amount of US$760,000 as ~~follows~~of December 31, 2011 (as of March 31, 2011: US$Nil).

	As of September 30,		As of March 31,
	2011		2011
	US$’000		US$’000
Corporate and personal guarantees jointly issued by related parties (Note 14(d))		9,313		17,557
Corporate guarantees issued by third parties		1,957		3,435
Corporate guarantees jointly issued by related parties and third parties (Note 14(d))		2,348		-

In addition, various parties have issued guarantee against these notes payable as follows:

As of September 30, 2011 and March 31, 2011, the Company had unutilized banking facilities of approximately US$33,185,000 and US$4,809,000 respectively to meet the liquidity needs.

	As of December 31,		As of March 31,
	2011		2011
	US$’000		US$’000

Corporate and personal guarantees jointly issued by related parties (Note 14(d))		3,857		17,557
Corporate guarantees issued by third parties		1,968		3,435
Corporate guarantees jointly issued by related parties and third parties (Note 14(d))		787		-

~~12.~~As ~~SHORT-TERM~~of ~~BANK~~December ~~BORROWINGS~~31, 2011 and March 31, 2011, the Company had unutilized banking facilities of approximately US$29,438,000 and US$4,809,000, respectively to meet the liquidity needs.

~~Short~~12. SHORT-~~term~~TERM ~~bank~~BANK ~~borrowings comprise of the followings:~~BORROWINGS

		As of September 30,		As of March 31,
	Note	2011		2011
		US$’000		US$’000
Short-term bank loans	(i)		40,667		35,770
Bills financing	(ii)		41,363		29,389
			82,030		65,159

Short-term bank borrowings comprise of the followings:

- 19 -

			As of December 31,		As of March 31,
	Note		2011		2011
			US$’000		US$’000

Short-term bank loans		(i)		47,825		35,770
Bills financing		(ii)		91,687		29,389

				139,512		65,159

~~Chisen Electric Corporation Notes to and Forming Part of Unaudited Condensed Consolidated Financial Statements For the six months ended September 30, 2011 and 2010~~-17-

~~12.~~Chisen ~~SHORT-TERM~~Electric ~~BANK~~Corporation ~~BORROWINGS~~Notes ~~(CONTINUED)~~to and Forming Part of Unaudited Condensed Consolidated Financial Statements For the nine months ended December 31, 2011 and 2010

~~(i)~~12. ~~Short~~SHORT-~~term~~TERM ~~bank~~BANK ~~loans~~BORROWINGS (CONTINUED)

(i) Short-term bank loans ~~represent amounts due to various banks which are due within 12 months, and these loans can normally be renewed with the banks upon expiry/maturity.~~

~~The~~Short-term bank loans represent amounts due to various banks which are ~~collateralized~~due bywithin ~~assets~~12 ofmonths, ~~the~~and ~~Company~~these loans can normally be renewed with ~~carrying~~the ~~values~~banks asupon ~~follows:~~expiry/maturity.

	As of September 30,		As of March 31,
	2011		2011
	US$’000		US$’000
Long-term land lease prepayments		4,135		-
Trade receivables		12,522		5,038
		16,657		5,038

The loans are collateralized by assets of the Company with carrying values as follows:

Various parties have also issued guarantee against these short-term bank loans as follows:

	As of December 31,		As of March 31,
	2011		2011
	US$’000		US$’000

Long-term land lease prepayments and building		17,049		-
Trade receivables		13,411		5,038
Pledged deposits		4,723		-

		35,183		5,038

	As of September 30,		As of March 31,
	2011		2011
	US$’000		US$’000
Corporate and personal guarantees issued by related parties (Note 14(d))		16,937		25,389
Corporate guarantees issued by third parties		5,479		5,343

Various parties have also issued guarantee against these short-term bank loans as follows:

The weighted average annual interest rates of the short-term bank loans were 5.89% and 5.05% as of September 30, 2011 and March 31, 2011 respectively.

	As of December 31,		As of March 31,
	2011		2011
	US$’000		US$’000

Corporate and personal guarantees issued by related parties (Note 14(d))		17,033		25,389
Corporate guarantees issued by third parties		4,565		5,343
Corporate guarantees jointly issued by related parties and third parties (Note 14(d))		1,417		-

~~(ii)~~The ~~Bills~~weighted ~~financing~~average annual interest rates of the short-term bank loans were 6.39% and 5.05% as of December 31, 2011 and March 31, 2011, respectively.

~~Bill~~(ii) ~~financing~~Bills represents amounts due to various banks which are repayable within six months from the date of issue. As of September 30, 2011 and March 31, 2011, the bills are collateralized by certain restricted bank balances of the Company with carrying value of US$14,696,000 and US$14,122,000 respectively and guaranteed by certain related parties and third parties to the extent of US$12,913,000 and US$15,267,000 respectively.financing

~~The~~Bill ~~weighted~~financing ~~average~~represents amounts ~~annual~~due ~~interest~~to ~~rates~~various ofbanks ~~the~~which ~~bills~~are ~~financing~~repayable ~~were~~within ~~4.02%~~nine ~~and~~months 3from the date of issue.~~31%~~ asAs of ~~September~~December 3031, 2011 and March 31, 2011, the bills are collateralized by certain restricted bank balances of the Company with carrying value of US$38,797,000 and US$14,122,000, respectively and guaranteed by certain related parties, and related parties and third parties jointly to the extent of US$28,106,000 and US$14,171,000, respectively.

-The 20weighted -average annual interest rates of the bills financing were 8.15% and 3.31% as of December 31, 2011 and March 31, 2011, respectively.

~~Chisen Electric Corporation Notes to and Forming Part of Unaudited Condensed Consolidated Financial Statements For the six months ended September 30, 2011 and 2010~~-18-

~~13.~~Chisen ~~GOVERNMENT~~Electric ~~SUBSIDIES~~Corporation Notes to and Forming Part of Unaudited Condensed Consolidated Financial Statements For the nine months ended December 31, 2011 and 2010

During the year ended March 31, 2008, the Company received a government grant of approximately US$231,000 for the purpose of subsidising its acquisition of property, plant and equipment, of which approximately US$13~~,000~~. ~~and~~GOVERNMENT US$12,000 were credited to the statement of operations for the three months ended September 30, 2011 and 2010 respectively, and US$25,000 and US$24,000 were credited to the statement of operations for the six months ended September 30, 2011 and 2010 respectively.SUBSIDIES

~~14.~~During ~~RELATED~~the ~~PARTY~~year ~~TRANSACTIONS~~ended March 31, 2008, the Company received a government grant of approximately US$231,000 for the purpose of subsidising its acquisition of property, plant and equipment, of which approximately US$13,000 and US$12,000 were credited to the statement of operations for the three months ended December 31, 2011 and 2010, respectively, and US$38,000 and US$36,000 were credited to the statement of operations for the nine months ended December 31, 2011 and 2010, respectively.

~~(a)~~14. ~~Names~~RELATED ~~and~~PARTY ~~relationship of related parties:~~TRANSACTIONS

~~Name of related party Existing relationships with the Company Mr. Xu Kecheng Director and controlling stockholder of Chisen Electric Zhejiang Chisen Glass Company Limited~~ (~~“Chisen Glass”)* A company controlled by~~ a ~~close family member of Mr. Xu Kecheng Mr. Xu Keyong A close family member of Mr. Xu Kecheng Ms. Zhou Fang Qin Spouse of Mr. Xu Kecheng Changxing Chisen Xinguangyuan Company Limited (“Xinguangyuan”~~)* ANames ~~company~~and ~~controlled~~relationship ~~by a close family member~~ of ~~Mr.~~related Xu Kecheng Zhejiang Ai Ge Organism Products Company Limited (“Ai Ge Organism”)* A company controlled by Mr. Xu Kecheng Zhejiang Changxing Nuo Wan Te Ke Glass Company Limited (“Nuo Wan Te Ke”)* A company controlled by a close family member of Mr. Xu Kecheng Zhejiang Changxing Ruilang Electronic Company Limited (“Ruilang Electronic”) * A company controlled by a close family member of Mr. Xu Kechengparties:

Name of related party Existing relationships with the Company Mr. Xu Kecheng Director and controlling stockholder of Chisen Electric Zhejiang Chisen Glass Company Limited (“Chisen Glass”)* ~~These~~A ~~are~~company ~~direct~~controlled ~~translation~~by a close family member of ~~the~~Mr. ~~name~~Xu inKecheng ~~Chinese~~Mr. ~~for~~Xu ~~identification~~Keyong ~~purpose~~A ~~only~~close ~~and~~family ~~are~~member ~~not~~of ~~the~~Mr. ~~official~~Xu ~~names~~Kecheng inMs. ~~English~~Zhou Fang Qin Spouse of Mr. Xu Kecheng Changxing Chisen Xinguangyuan Company Limited (“Xinguangyuan”)* A company controlled by a close family member of Mr. Xu Kecheng Zhejiang Ai Ge Organism Products Company Limited (“Ai Ge Organism”)* A company controlled by Mr. Xu Kecheng Zhejiang Changxing Nuo Wan Te Ke Glass Company Limited (“Nuo Wan Te Ke”)* A company controlled by a close family member of Mr. Xu Kecheng Zhejiang Changxing Ruilang Electronic Company Limited (“Ruilang Electronic”) * A company controlled by a close family member of Mr. Xu Kecheng

-* 21These -are direct translation of the name in Chinese for identification purpose only and are not the official names in English.

~~Chisen Electric Corporation Notes to and Forming Part of Unaudited Condensed Consolidated Financial Statements For the six months ended September 30, 2011 and 2010~~-19-

~~14.~~Chisen ~~RELATED~~Electric ~~PARTY~~Corporation ~~TRANSACTIONS~~Notes ~~(CONTINUED)~~to and Forming Part of Unaudited Condensed Consolidated Financial Statements For the nine months ended December 31, 2011 and 2010

~~(b)~~14. ~~Summary~~RELATED ofPARTY ~~balances~~TRANSACTIONS ~~with related parties:~~(CONTINUED)

	As of September 30,		As of March 31,
	2011		2011
	US$’000		US$’000
Due from a related party:
Ms. Zhou Fang Qin		8		8
Due to related parties:
Mr. Xu Keyong		2		2
Chisen Glass		669		1,201
Ruilang Electronic		1,223		2,616
Ai Ge Organism		312		304
Nuo Wan Te Ke		-		3
Xinguangyuan		3		-
		2,209		4,126

(b) Summary of balances with related parties:

All amounts due from / to related parties represent unsecured advances which are interest-free and repayable on demand.

	As of December 31,		As of March 31,
	2011		2011
	US$’000		US$’000
Due from a related party:
Ms. Zhou Fang Qin		5		8

Due to related parties:
Mr. Xu Keyong		2		2
Chisen Glass		1,176		1,201
Ruilang Electronic		1,863		2,616
Ai Ge Organism		314		304
Nuo Wan Te Ke		-		3
Xinguangyuan		1		-

		3,356		4,126

~~(c)~~All amounts ~~Summary~~due offrom / to related ~~party~~parties ~~transactions:~~represent unsecured advances which are interest-free and repayable on demand.

		Three months ended September 30,				Six months ended September 30,
Name of related party	Nature of transactions	2011		2010		2011		2010
		US$’000		US$’000		US$’000		US$’000
Ruilang Electronic	Purchase of raw materials		50		2,201		919		4,134
Chisen Glass	Purchase of raw materials		4		760		382		1,420

(c) Summary of related party transactions:

- 22 -

			Three months ended December 31,				Nine months ended December 31,
Name of related party	Nature of transactions		2011		2010		2011		2010
				US$’000		US$’000		US$’000		US$’000

Ruilang Electronic		Purchase of raw materials		2,969		2,609		3,888		6,743
Chisen Glass		Purchase of raw materials		1,453		988		1,835		2,408

~~Chisen Electric Corporation Notes to and Forming Part of Unaudited Condensed Consolidated Financial Statements For the six months ended September 30, 2011 and 2010~~-20-

~~(d)~~14. ~~Other~~RELATED ~~arrangements:~~PARTY TRANSACTIONS (CONTINUED)

˙ As of September 30, 2011, Chisen Glass provided guarantees, in aggregate, amounting to US$4,696,000, US$1,174,000 and US$3,522,000 to secure the short-term bank loans, notes payable and bills financing of the Company, respectively.(d) Other arrangements:

˙ As of ~~September~~December 3031, 2011, Chisen Glass provided guarantees, in aggregate, amounting to US$4,723,000, US$1,~~096~~181,000 ofand ~~the~~US$3,542,000 ~~Company’s~~to ~~notes~~secure ~~payable~~the ~~was~~short-term ~~guaranteed~~bank ~~by Ruilang Electronic~~loans, ~~Mr.~~notes Xupayable ~~Kecheng~~ and ~~Ms.~~bills ~~Zhou~~financing ~~Fang~~of ~~Qin~~the Company, respectively.

˙ As of ~~September~~December 3031, 2011, Mr. Xu Kecheng, Ms. Zhou Fang Qin and a third party provided guarantees, in aggregate, amounting to US$2,~~348~~361,000 to secure the ~~notes~~bills ~~payable~~financing of the Company.

˙ As of ~~September~~December 3031, 2011, Xinguangyuan, Mr. Xu Kecheng and Ms. Zhou Fang Qin, provided guarantees, in aggregate, amounting to US$12,~~241~~311,000 and US$1,~~565~~574,000 to secure the short-term bank loans and notes payable of the Company, respectively.

˙ As of ~~September~~December 3031, 2011, Chisen Glass, Mr. Xu Kecheng, ~~and~~ Ms. Zhou Fang Qin and Ruilang Electronic provided guarantees, in aggregate, amounting to US$1,~~565~~102,000 and US$11,020,000 to secure the notes payable and bills financing of the Company, respectively.

˙ As of ~~September~~December 3031, 2011, ~~Chisen~~Xinguangyuan ~~Glass, Mr. Xu Kecheng, Ms. Zhou Fang Qin and Ruilang Electronic~~ provided guarantees, in aggregate, amounting to US$313,~~913~~544,000 ~~and US$3,130,000~~ to secure the ~~notes payable and~~ bills financing of the Company~~, respectively~~.

˙ As of ~~September~~December 3031, 2011, ~~Xinguangyuan~~Chisen Glass and certain third parties provided guarantees, in aggregate, amounting to US$13,~~565~~936,000, US$787,000 and US$2,361,000 to secure the short-term bank loans, notes payable and bills financing of the Company, respectively.

˙ As of ~~September~~December 3031, 2011, ~~Xinguangyuan~~Chisen Glass, ~~Mr. Xu Kecheng~~Xinguangyuan, ~~Ms. Zhou Fang Qin~~ and certain third parties provided guarantees, in aggregate, amounting to US$43,~~696~~463,000 to secure the bills financing of the Company.

-˙ 23As -of December 31, 2011, Mr. Xu Kecheng, Ms. Zhou Fang Qin, Xinguangyuan and certain third parties provided guarantees, in aggregate, amounting to US$5,986,000 to secure the bills financing of the Company.

~~Chisen Electric Corporation Notes to and Forming Part of Unaudited Condensed Consolidated Financial Statements For the six months ended September 30, 2011 and 2010~~-21-

~~15.~~Chisen ~~COMMITMENTS~~Electric ~~AND~~Corporation ~~CONTINGENCIES~~Notes to and Forming Part of Unaudited Condensed Consolidated Financial Statements For the nine months ended December 31, 2011 and 2010

~~(a)~~15. ~~Operating~~COMMITMENTS ~~lease~~AND ~~commitments~~CONTINGENCIES

~~The~~(a) ~~following~~Operating ~~table~~lease ~~summarizes the approximate future minimum rental payments under non-cancelable operating leases in effect as of September 30, 2011 and March 31, 2011:~~commitments

	As of September 30,		As of March 31,
	2011		2011
	US$’000		US$’000
Within one year		451		655
One to two years		617		688
Two to three years		29		508
Three to four years		-		120
Total		1,097		1,971

The following table summarizes the approximate future minimum rental payments under non-cancelable operating leases in effect as of December 31, 2011 and March 31, 2011:

(b) Capital commitments

	As of December 31,		As of March 31,
	2011		2011
	US$’000		US$’000

Within one year		450		655
One to two years		398		688
Two to three years		141		508
Three to four years		-		120

Total		989		1,971

As(b) ofCapital ~~September 30, 2011 and March 31, 2011, the Company had outstanding capital expenditure~~ commitments ~~relating to various construction projects and purchase of land and machineries for an aggregate amount of approximately US$137,907,000 and US$150,448,000 respectively.~~

~~16.~~As ~~PROVISION~~of ~~FOR~~December ~~WARRANTY~~31, 2011 and March 31, 2011, the Company had outstanding capital expenditure commitments relating to various construction projects and purchase of land and machineries for an aggregate amount of approximately US$128,619,000 and US$150,448,000, respectively.

~~Estimated warranty costs are recognised at the time when the Company sells its products and are included in sale, marketing and distribution expenses~~16. ~~The~~PROVISION ~~Company~~FOR uses historical failure rates and costs to repair product defects during the warranty period to estimate warranty costs while are reviewed periodically in light of actual experience. The reconciliation of the changes in the warranty obligation is as follows:WARRANTY

	Three months ended September 30,						Six months ended September 30,
	2011			2010			2011			2010
	US$’000			US$’000			US$’000			US$’000
Beginning balance		367			283			301			226
Exchange realignment		5			4			9			5
Accrual for warranties issued during the period		85			230			224			554
Settlement made during the period		(135	)		(48	)		(212	)		(316	)
Closing balance		322			469			322			469

Estimated warranty costs are recognized at the time when the Company sells its products and are included in sale, marketing and distribution expenses. The Company uses historical failure rates and costs to repair product defects during the warranty period to estimate warranty costs while are reviewed periodically in light of actual experience. The reconciliation of the changes in the warranty obligation is as follows:

- 24 -

	Three months ended December 31,						Nine months ended December 31,
	2011			2010			2011			2010
	US$’000			US$’000			US$’000			US$’000

Beginning balance		322			469			301			226
Exchange realignment		-			1			8			6
Accrual for warranties issued during the period		232			282			457			836
Settlement made during the period		(363	)		(431	)		(575	)		(747	)

Closing balance		191			321			191			321

~~Chisen Electric Corporation Notes to and Forming Part of Unaudited Condensed Consolidated Financial Statements For the six months ended September 30, 2011 and 2010~~-22-

~~17.~~Chisen ~~RETIREMENT~~Electric ~~PLAN~~Corporation ~~COSTS~~Notes to and Forming Part of Unaudited Condensed Consolidated Financial Statements For the nine months ended December 31, 2011 and 2010

Contributions to defined contribution retirement schemes are charged to cost of sales, sales, marketing and distribution costs and general and administrative expenses in the consolidated statements of operations and other comprehensive income as and when the related employee services are provided17. ~~Retirement~~RETIREMENT ~~plan~~PLAN costs were US$274,000 and US$286,000 for the three months ended September 30, 2011 and 2010 respectively, and US$387,000 and US$415,000 for the six months ended September 30, 2011 and 2010 respectively.COSTS

18Contributions to defined contribution retirement schemes are charged to cost of sales, sales, marketing and distribution costs and general and administrative expenses in the consolidated statements of operations and other comprehensive income as and when the related employee services are provided. Retirement ~~SEGMENTAL~~plan ~~INFORMATION~~costs were US$764,000 and US$235,000 for the three months ended December 31, 2011 and 2010, respectively, and US$1,038,000 and US$650,000 for the nine months ended December 31, 2011 and 2010, respectively.

During the six months ended September 30, 2011 and 2010, all revenue of the Company represented income from sales of sealed lead-acid battery and therefore no financial information by business segment is presented18. ~~Furthermore,~~SEGMENTAL ~~as all income is derived from the PRC, no geographical segment is presented.~~INFORMATION

19During the nine months ended December 31, 2011 and 2010, all revenue of the Company represented income from sales of sealed lead-acid battery and related components and therefore no financial information by business segment is presented. ~~EXTRAORDINARY~~Furthermore, ~~ITEMS~~as all income is derived from the PRC, no geographical segment is presented.

~~(a)~~19. ~~Extraordinary~~EXTRAORDINARY ~~gain~~ITEMS

During the six months ended September 30, 2011, Zhejiang Chisen had completed the relocation of production plant in Jingyi Road. Pursuant to the Compensation Agreement on Relocation and Acquisition entered into by Zhejiang Chisen and Administrative Committee of Changxing Economic Development Zone (~~“ACC”), ACC shall pay Zhejiang Chisen~~ a ~~compensation in the amount of RMB98,514,000 (US$15,278,000~~) ~~for~~Extraordinary the loss on long-term land lease prepayment and buildings located in Jingyi Road. In May 2011, the Company wrote off the long-term land lease prepayment and buildings in Jingyi Road with net book value of approximately RMB14,354,000 (US$2,225,000) and therefore net compensation income of RMB84,160,000 (US$13,053,000) was recognised for the period. As of September 30, 2011, the compensation of US$9,498,000 has not been received and was recorded as current assets in the consolidated balance sheet.gain

AsDuring athe ~~result~~nine months ended December 31, 2011, Zhejiang Chisen had completed the ~~Company~~relocation ~~recorded~~of anproduction ~~extraordinary~~plant ~~gain~~in Jingyi Road. Pursuant to the Compensation Agreement on Relocation and Acquisition entered into with Zhejiang Chisen and Administrative Committee of Changxing Economic Development Zone (“ACC”), ACC shall pay Zhejiang Chisen a compensation in the amount of RMB98,514,000 (US$1315,~~053~~354,000) for the loss on long-term land lease prepayment and buildings located in Jingyi Road. In May 2011, the ~~consolidated~~Company ~~statements~~wrote off the long-term land lease prepayment and buildings in Jingyi Road with net book value of ~~operations~~approximately RMB14,354,000 (US$2,237,000) and ~~other~~therefore ~~comprehensive~~net compensation income ~~for~~of RMB84,160,000 (US$13,117,000) was recognized during the ~~six~~period. ~~months~~As ~~ended~~of ~~September~~December 3031, 2011, the compensation of US$7,978,000 has not been received and was recorded as current assets in the consolidated balance sheet.

-As 25a -result, the Company recorded an extraordinary gain of US$13,117,000 in the consolidated statements of operations and other comprehensive income for the nine months ended December 31, 2011.

~~Chisen Electric Corporation Notes to and Forming Part of Unaudited Condensed Consolidated Financial Statements For the six months ended September 30, 2011 and 2010~~-23-

~~19.~~Chisen ~~EXTRAORDINARY~~Electric ~~ITEMS~~Corporation ~~(CONTINUED)~~Notes to and Forming Part of Unaudited Condensed Consolidated Financial Statements For the nine months ended December 31, 2011 and 2010

~~(b)~~19. ~~Extraordinary~~EXTRAORDINARY ~~loss~~ITEMS (CONTINUED)

~~During~~(b) ~~the~~Extraordinary six months ended September 30, 2011, and without advance notice to the Company, the PRC Central Government tightened its environment protection policy which applies to all lead-acid battery manufacturers. Pursuant to the newly tightened policy, a 500 meters isolated area must be maintained between production facilities, including assembly facilities, and residential areas.loss

~~The~~During ~~Company’s Jing’er Road plant was mainly utilized for assembly activities and it cannot comply with~~ the ~~tightened~~nine ~~policy.~~months ~~Management~~ended ~~plans~~December 31, to2011, ~~gradually scale down the operation of Jing’er Road plant~~ and ~~estimates~~without ~~that~~advance itnotice ~~will relocate such production facilities~~ to the ~~plant in Xuyi County~~Company, ~~Jiangsu Province prior to December 31, 2011. After evaluating~~ the ~~plant~~PRC ~~and~~Central ~~machinery~~Government attightened ~~Jing’er~~its ~~Road~~environment ~~plant,~~protection ~~some~~policy ofwhich applies ~~them~~to ~~cannot~~all ~~fit~~lead-acid ~~into~~battery ~~the plant in Jiangsu Xuyi~~manufacturers. ~~The~~Pursuant ~~Company decided~~ to ~~impair~~ the ~~value~~newly oftightened ~~plant~~policy, ~~and~~a ~~machinery~~500 asmeters ~~well~~quarantined asisolated ~~leasehold~~area must ~~improvement~~be ofmaintained ~~Jing’er~~between ~~Road~~production ~~plant~~facilities, ~~down~~including toassembly ~~its~~facilities, ~~recoverable~~and ~~amount.~~residential ~~The impairment loss was recorded as follows:~~areas.

	Six months ended September 30,
	2011		2010
	US$’000		US$’000
Leasehold improvement		1,012		-
Plant and machinery		828		-
		1,840		-

The Company’s Jing’er Road plant was mainly utilized for assembly activities and it cannot comply with the tightened policy. Management had gradually scaled down the operation of Jing’er Road plant and the Company had completed the relocation of certain production facilities to the plant in Xuyi County, Jiangsu Province during the nine months ended December 31, 2011. After evaluating the plant and machinery at Jing’er Road plant, some of them cannot fit into the plant in Jiangsu Xuyi. The Company decided to impair the value of plant and machinery as well as leasehold improvement of Jing’er Road plant down to its recoverable amount. The impairment loss was recorded as follows:

The management considered that this government behavior is very unusual and rare to happen, and thus the relevant impairment loss of plant and machinery was classified as an extraordinary item.

	Nine months ended December 31,
	2011		2010
	US$’000		US$’000

Leasehold improvement		921		-
Plant and machinery		927		-

		1,848		-

-The 26management -considered that this government behavior is very unusual and rare to happen, and thus the relevant impairment loss of plant and machinery was classified as an extraordinary item.

~~ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION~~-24-

~~Forward~~ITEM ~~Looking~~2. ~~Statements~~MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

AsForward ~~used~~Looking in this report, unless otherwise indicated, the terms “we”, “our”, “us”, the “Company”, the “Registrant” and “Chisen” refer to Chisen Electric Corporation, a Nevada corporation. We conduct our business through our subsidiaries, which include our wholly-owned subsidiary, Fast More Limited, a Hong Kong investment holding company (“Fast More”), its 100% owned and chief operating subsidiary, Zhejiang Chisen Electric Co., Ltd., a wholly foreign owned entity (“WFOE”) organized under the laws of the PRC (f/k/a Changxing Chisen Electric Co., Ltd. and hereinafter referred to as “CCEC”) and CCEC’s subsidiary, Chisen Electric Jiangsu Co., Ltd. (“CEJC”). “China” or “PRC” refers to the People’s Republic of China. “RMB” or “Renminbi” refers to the legal currency of China and “$”, “US$” or “U.S. Dollars” refers to the legal currency of the United States.Statements

~~The~~As ~~following~~used ~~discussion~~in ofthis ~~our~~report, ~~financial~~unless ~~condition~~otherwise ~~and~~indicated, the ~~results~~terms of“we”, ~~operations~~“our”, of“us”, the “Company”, isthe ~~based~~“Registrant” ~~upon~~ and ~~should~~“Chisen” refer beto ~~read~~Chisen inElectric ~~conjunction~~Corporation, ~~with~~a ~~our~~Nevada ~~consolidated~~corporation. ~~financial~~We ~~statements~~conduct ~~and~~our ~~their~~business ~~related~~through ~~notes~~our ~~included~~subsidiaries, inwhich ~~this~~include ~~report.~~our wholly-owned ~~This~~subsidiary, ~~report~~Fast ~~contains~~More ~~forward-looking statements. Generally~~Limited, ~~the~~a ~~words~~Hong ~~“believes”,~~Kong ~~“anticipates”,~~investment ~~“may”,~~holding ~~“will”,~~company (“~~should”,~~Fast ~~“expect~~More”), ~~“intend”,~~its ~~“estimate”,~~100% ~~“continue”~~owned and chief ~~similar~~operating ~~expressions~~subsidiary, orZhejiang ~~the~~Chisen ~~negative~~Electric ~~thereof~~Co., orLtd., ~~comparable~~(f/k/a ~~terminology~~Changxing ~~are~~Chisen ~~intended~~Electric toCo., ~~identify forward-looking statements~~Ltd. ~~Such~~and ~~statements~~hereinafter ~~are~~referred ~~subject~~ to ~~certain~~as ~~risks~~“CCEC”) a ~~and~~wholly ~~uncertainties,~~foreign ~~including~~owned ~~the~~entity ~~matters~~(“WFOE”) ~~set~~organized ~~forth~~under the inlaws ~~this~~of ~~report~~the orPRC and ~~other~~CCEC’s subsidiary, ~~reports~~Chisen orElectric ~~documents~~Jiangsu weCo., ~~file~~Ltd. ~~with~~(“CEJC”). “China” ~~the~~or ~~SEC~~“PRC” ~~from time~~ refers to ~~time,~~the ~~which~~People’s ~~could~~Republic ~~cause~~of ~~actual~~China. ~~results~~“RMB” or ~~outcomes~~“Renminbi” refers to ~~differ~~the ~~materially~~legal ~~from~~currency ~~those~~of ~~projected.~~China ~~Undue~~and “$”, ~~reliance~~“US$” ~~should~~or ~~not~~“U.S. beDollars” ~~placed~~refers onto ~~these~~the ~~forward-looking~~legal ~~statements~~currency ~~which speak only as~~ of the ~~date~~United ~~hereof~~States. ~~We undertake no obligation to update these forward-looking statements.~~

The following discussion of our financial condition and results of operations of the Company ~~Overview~~is based upon and should be read in conjunction with our consolidated financial statements and their related notes included in this report. This report contains forward-looking statements. Generally, the words “believes”, “anticipates”, “may”, “will”, “should”, “expect”, “intend”, “estimate”, “continue” and similar expressions or the negative thereof or comparable terminology are intended to identify forward-looking statements. Such statements are subject to certain risks and uncertainties, including the matters set forth in this report or other reports or documents we file with the SEC from time to time, which could cause actual results or outcomes to differ materially from those projected. Undue reliance should not be placed on these forward-looking statements which speak only as of the date hereof. We undertake no obligation to update these forward-looking statements.

WeCompany are one of the leading producers of sealed lead-acid motive batteries, also known as valve regulated lead-acid motive batteries (“VRLA batteries”) in China's personal transportation device market. Our motive battery products, sold under our own brand name “Chisen”, are predominantly used in electric bicycles and are distributed and sold in China. Among all types of batteries for electric bicycles, the lead-acid motive battery is the preferred choice of electric bicycle manufacturers in China, accounting for 95% of the market share because of its cost efficiency. In general, we manufacture over 19,800,000 sealed lead-acid motive batteries each year, have more than 2,500 employees and are one of China's largest manufacturers of sealed lead-acid motive batteries for electric-powered bicycles (LABEBs). For the six months ended September 30, 2011 and 2010, sales revenues were US$71,821,000 and US$127,042,000, respectively, and our net income attributable to CIEC common stockholders during the same periods amounted to US$9,261,000 and US$6,949,000, respectively. Overview

~~Corporate~~We ~~Information~~are one of the leading producers of sealed lead-acid motive batteries, also known as valve regulated lead-acid motive batteries (“VRLA batteries”) in China's personal transportation device market. Our motive battery products, sold under our own brand name “Chisen”, are predominantly used in electric bicycles and are distributed and sold in China. Among all types of batteries for electric bicycles, the lead-acid motive battery is the preferred choice of electric bicycle manufacturers in China, accounting for 95% of the market share because of its cost efficiency. In general, we manufacture over 19,800,000 sealed lead-acid motive batteries each year, have more than 2,500 employees and are one of China's largest manufacturers of sealed lead-acid motive batteries for electric-powered bicycles (LABEBs). For the nine months ended December 31, 2011 and 2010, sales revenues were US$102,900,000 and US$194,712,000, respectively, and our net (loss) income attributable to CIEC common stockholders during the same periods amounted to US$(1,052,000) and US$9,496,000, respectively.

~~Our~~Corporate offices are located in the Changxing Economic Development Zone at the bank of the Taihu Lake in the County of Changxing in Zhejiang Province, in close proximity to major national transportation systems, including National Highways 104 and 318, the Shanghai – Jiangsu – Zhejiang – Anhui – Hangzhou – Nanjing Expressway, the Changxing – Huzhou – Shanghai Channel, the Xuancheng – Hangzhou Railway and the Xinyi – Changxing Railway. Our registered office is located at No. 1188, Taihu Avenue, Economic Development Zone, Changxing County, Zhejiang Province, PRC, where the office building is under construction. Our executive office has therefore been temporarily moved to No. 559, Jing’er Road, Economic Development Zone, Changxing County, Zhejiang Province, PRC. Our telephone number is (86) 572-6267666 and our corporate website in English is located at www.chisenelectric.com.Information

WeOur offices are alocated ~~reporting~~in ~~company~~the ~~under~~Changxing ~~Section~~Economic Development 13Zone at the bank of the ~~Securities~~Taihu ~~Exchange~~Lake ~~Act~~in the County of ~~1934~~Changxing in Zhejiang Province, asin ~~amended~~close proximity to major national transportation systems, including National Highways 104 and 318, the Shanghai – Jiangsu – Zhejiang – Anhui – Hangzhou – Nanjing Expressway, the Changxing – Huzhou – Shanghai Channel, the Xuancheng – Hangzhou Railway and the Xinyi – Changxing Railway. Our ~~shares~~registered ofoffice ~~common~~is ~~stock~~located ~~are~~at ~~not~~No. ~~currently~~1188, ~~listed~~Taihu onAvenue, ~~any~~Economic ~~national~~Development ~~securities~~Zone, Changxing ~~exchange~~County, ~~however~~Zhejiang ~~our~~Province, ~~common~~PRC, ~~stock~~where isthe ~~quoted~~office building is under ~~the~~construction. ~~symbol~~Our ~~“CIEC”~~executive onoffice ~~the~~has ~~OTCQB~~therefore been temporarily moved to No. 559, Jing’er Road, Economic Development Zone, Changxing County, Zhejiang Province, PRC. Our telephone number is (86) 572-6267666 and our corporate website in English is located at www.chisenelectric.com.

OnWe ~~May~~are ~~27,~~a ~~2011,~~reporting ~~Chisen~~company ~~fully~~under ~~disposed~~Section 13 of ~~its~~the ~~interest~~Securities inExchange ~~Chisen~~Act ~~Technology~~of ~~Holdings Corporation~~1934, aas ~~Nevada~~amended. ~~corporation~~Our ~~(“Chisen~~shares ~~Technology”) for cash consideration~~ of ~~US$10.~~common ~~Chisen~~stock ~~Technology~~are ~~had~~not nocurrently ~~operations~~listed ~~since~~on ~~its~~any ~~date~~national ofsecurities exchange ~~incorporation~~however ~~through~~our ~~May~~common ~~27,~~stock ~~2011. The~~is ~~disposal~~quoted ofunder ~~Chisen~~the ~~Technology~~symbol ~~has~~“CIEC” ~~had no significant impact~~ on the ~~value of the Company’s assets, operating cash flows or earnings per share~~OTCQB.

-On May 27, -2011, Chisen fully disposed of its interest in Chisen Technology Holdings Corporation, a Nevada corporation (“Chisen Technology”) for cash consideration of US$10. Chisen Technology had no operations since its date of incorporation through May 27, 2011. The disposal of Chisen Technology has had no significant impact on the value of the Company’s assets, operating cash flows or earnings per share.

~~Development Strategy of the Company~~-25-

WeRecent strive to create an international first-class brand and become the one of the leaders in providing “green” energy in the global electric bicycle market. Through our continuous researching and developing of new chemical energy technologies, we intend to provide energy-saving and highly-effective energy solutions to our customers for improving quality of life while maintaining a sustainable ecological environment. Our goal is to become the largest battery developer and producer with a first-class sales and service network in China. With one of the leading positions in the LABEB battery product market in China, our expansion plans in Changxing County (Zhejiang Province) and Jiangsu Province, our product research and development capability and our cooperative partnerships with clients, we believe that we are well positioned to capture additional business opportunities in China's personal transportation device markets. In light of the prevailing economic trends for developing alternative transportation devices that reduce the reliance on oil and produce lesser emissions, we plan to explore the motive battery market for electric-powered motorcycles and electric cars. Leveraging our experience and expertise in producing lead-acid motive battery products for electric bicycles, we plan to expand our product mix to include valve regulated lead-acid back-up batteries, the lithium-ion battery, lead-acid power storage batteries dedicated for solar and wind power and lead-acid motive batteries for electric cars.Developments

~~Production~~On ~~Capacity~~November 22, 2011, the Company effected a forward split of its common stock, par value $0.001 per share (“Common Stock”) and the proportional increase in its authorized shares of Common Stock at a split ratio of 10-for-1. As a result of this corporate action, the total number of issued and outstanding shares of Common Stock increased from 50,000,000 to 500,000,000 shares, and the Company’s authorized shares of Common Stock simultaneously increased from 100,000,000 to 1,000,000,000 shares. Shares of Common Stock are payable pursuant to the 10-for-1 forward stock split upon surrender of old certificates to the Company’s transfer agent, Interwest Transfer Co., Inc., 1981 East Murray Holladay Road, Suite 100, P.O. Box 17136, Salt Lake City, Utah 84117, telephone (801) 272-9294, facsimile (801) 277-3147.

~~Pursuant~~There has been no adjustment to anthe ~~Investment~~par ~~Agreement~~value of ~~entered~~the ~~into~~Common byStock and ~~between~~no ~~CCEC~~changes ~~and~~have been made to the ~~Administrative~~Company’s ~~Committee~~preferred stock as a result of ~~Changxing~~this ~~Economic~~corporate ~~Development~~action ~~Zone~~(as of November 22, we2011, ~~terminated~~the ~~our~~Company ~~operations~~had atno ~~Plant~~shares Aof atpreferred ~~Jingyi~~stock ~~Road~~issued inor ~~Changxing~~outstanding). The ~~County,~~Company’s ~~Zhejiang~~Board of ~~Province~~Directors approved this corporate action however shareholder approval was not required pursuant to Sections 78.207 Weand ~~are~~78.209 of ~~investing~~the inNevada Revised Statutes (“NRS”). In accordance with the ~~construction~~NRS, ofthe Company filed a ~~factory~~“Certificate of inChange ~~Xuyi~~Pursuant ~~County,~~to ~~Jiangsu~~Section ~~Province~~78.209” ~~and~~with atthe ~~Jingsi~~Nevada ~~Road~~Secretary inof ~~Changxing~~State ~~County,~~which ~~Zhejiang~~became ~~Province~~effective after the Financial Industry Regulatory Authority announced the effectiveness of the corporate action.

~~Pursuant to a Project Investment Contract and a Supplemental Agreement to the Project Investment Contract entered into by and between CEJC and the Jiangsu Xuyi Economic~~ Development ~~Zone~~Strategy Administrative Committee on September 6, 2010, CEJC shall invest, in the aggregate, approximately RMB1,200,000,000 (approximately US$177,000,000) in three stages to build the Chisen Circular Economy Industry Park (“Plant D”) to manufacture VRLA batteries, as well as our newest product, lithium-ion batteries, and other related products in the Jiangsu Xuyi Economic Development Zone in Xuyi County, Jiangsu Province. In the first stage, CEJC will invest in the production of ~~VRLA batteries only and shall invest approximately RMB422,000,000 (approximately US$62,000,000), including approximately RMB150,000,000 (approximately US$22,000,000) in fixed assets for~~ the ~~production of VRLA batteries only. The project will be operated primarily by the cash generated from our operating profit and short term bank loans.~~Company

~~During~~We ~~the~~strive ~~three~~to ~~months~~create ~~ended~~an ~~June~~international ~~30,~~first-class brand ~~2011~~ and ~~without~~become ~~advance~~the ~~notice~~one toof the ~~Company,~~leaders in providing “green” energy in the ~~PRC~~global ~~Central~~electric ~~Government~~bicycle ~~tightened~~market. Through our ~~its~~continuous ~~environmental~~researching ~~protection~~and ~~policy~~developing ~~which~~of ~~applies~~new chemical energy technologies, we intend to ~~all~~provide ~~lead~~energy-~~acid~~saving ~~battery~~and ~~manufacturers.~~highly-effective energy ~~Pursuant~~solutions to ~~the~~our ~~new~~customers ~~policy,~~for improving quality of life while maintaining a ~~500~~sustainable ~~meter~~ecological ~~isolated~~environment. Our goal ~~area~~is ~~must~~to bebecome ~~maintained~~the ~~between~~largest ~~production~~battery ~~facilities~~developer and ~~residential~~producer ~~areas~~with a first-class sales and service network in China. ~~From~~With one of the ~~beginning~~leading ofpositions ~~May,~~in the ~~Zhejiang~~LABEB ~~Environmental~~battery ~~Protection~~product ~~Bureau~~market in China, our expansion plans in Changxing County (~~the~~Zhejiang ~~“ZEPB”~~Province) and ~~conducted~~Jiangsu anProvince, ~~environmental~~our ~~sanitation~~product ~~investigation~~research atand ~~our~~development ~~plant~~capability atand ~~Jing’er~~our ~~Road~~cooperative ofpartnerships ~~Changxing~~with ~~County~~clients, ~~Zhejiang~~we ~~Province~~believe that ~~(“Plant~~we ~~B”)~~are well positioned to capture additional business opportunities in China's personal transportation device markets. ~~The~~In light ~~results~~of ~~showed~~the prevailing economic trends for developing alternative transportation devices that reduce the ~~sewage~~reliance on oil and ~~exhaust~~produce lesser ~~complied~~emissions, ~~with~~we ~~national~~plan ~~standards~~to explore the motive battery market for electric-powered motorcycles and electric cars. Leveraging our experience and expertise in ~~China,~~producing ~~however~~lead-acid motive battery products for electric bicycles, ~~the~~we ~~Company~~plan isto ~~not~~expand ~~maintaining~~our product mix to include valve regulated lead-acid back-up batteries, the ~~500~~lithium-ion ~~meter~~battery, ~~isolated~~lead-acid ~~area~~power ~~between~~storage ~~production~~batteries ~~facilities~~dedicated for solar and ~~residential~~wind ~~areas~~power and lead-acid motive batteries for electric cars.

~~After~~Production discussion with the Government, our battery charging activities and packing activities were permitted to keep operating until December 31, 2011, however all other production activities must have ceased pursuant to the tightened environmental policy on or before July 15, 2011. Management believes that our production facilities could not fully comply with the adjusted environmental policy as the residential area near Plant B showed (and continues to show) no signs of slowing its expansion towards Plant B, which is out of the Company’s control. As a result, we decided to scale down our operations at Plant B and relocate such production facilities to Plant D in Xuyi County, Jiangsu Province (as described below) before December 31, 2011. We have stopped all production activities, apart from battery charging activities and packing activities, during the period ended September 30, 2011. We did not suffer any penalty due to this tightened environmental protection policy. However, part of our production facilities in Plant B cannot be adequately transferred and implemented into our new production facility at Plant D, and we incurred an impairment loss of such facilities of US$1,840,000.Capacity

-Pursuant 28to -an Investment Agreement entered into by and between CCEC and the Administrative Committee of Changxing Economic Development Zone, we terminated our operations at Plant A at Jingyi Road in Changxing County, Zhejiang Province. We are investing in the construction of a factory in Xuyi County, Jiangsu Province and at Jingsi Road in Changxing County, Zhejiang Province.

AsPursuant ofto ~~the~~a ~~date~~Project ofInvestment ~~this~~Contract ~~report,~~and a Supplemental Agreement to the ~~Government~~Project ~~preliminarily~~Investment ~~agreed~~Contract toentered ~~re-designate~~ into by and between CEJC and the ~~land~~Jiangsu Xuyi Economic Development Zone Administrative Committee on September 6, 2010, CEJC shall invest, in ~~Changxing~~the ~~County~~aggregate, toapproximately usRMB1,200,000,000 (approximately ~~for~~US$177,000,000) ~~redevelopment.~~in ~~Prior~~three stages to build the ~~new~~Chisen ~~plant~~Circular inEconomy ~~Changxing~~Industry ~~County being~~Park ~~built~~(“Plant D”) to manufacture VRLA batteries, as well as our ~~lead~~newest product, lithium-~~acid~~ion ~~battery~~batteries, ~~production~~and ~~will~~other berelated ~~relocated~~products toin ~~Plant~~the D.Jiangsu ~~However,~~Xuyi ~~since~~Economic ~~Plant~~Development Zone Din isXuyi ~~still~~County, ~~under~~Jiangsu aProvince. ~~trial~~In ~~production~~the first stage, weCEJC ~~believe~~will ~~our~~invest in the production ~~capacity~~of ~~will~~VRLA ~~not~~batteries ~~rebound~~only and shall invest approximately RMB422,000,000 (approximately US$62,000,000), including approximately RMB150,000,000 (approximately US$22,000,000) in afixed ~~short~~assets ~~time~~for ~~which~~the ~~could~~production ~~continue~~of toVRLA ~~have~~batteries anonly. ~~adverse~~The ~~effect~~project onwill be operated primarily by the cash generated from our operating ~~business~~profit and ~~operations~~short term bank loans.

~~Expand Offering of Highly Efficient Battery Products~~-26-

~~For~~During ~~future market development, we intend to focus on~~ the ~~lithium-ion~~three ~~battery,~~months ~~which~~ended isJune ~~a new product trend in the European~~30, US 2011 and ~~Japanese~~without ~~markets,~~advance onnotice ~~electric vehicle power batteries and on energy storage batteries dedicated~~ to ~~solar and wind power. We are currently committed to investing in and constructing new production facilities in Changxing County (Zhejiang Province) and in Xuyi County (Jiangsu Province). Since~~ the Company, isthe ~~experienced~~PRC inCentral ~~producing~~Government ~~motive~~tightened ~~batteries~~its ~~for~~environmental ~~powering~~protection ~~electric~~policy ~~bicycles,~~which ~~the Company intends~~ applies to ~~bring~~all ~~the lithium~~lead-~~ion~~acid battery ~~to market by focusing first on the market for lithium-ion batteries in electric bicycles~~manufacturers. WePursuant ~~estimate~~to ~~that our lithium-ion batteries will be launched and distributed into~~ the ~~marketplace~~new ~~within two years from March 31~~policy, ~~2011.~~a ~~The~~500 ~~Company~~meter ~~intends~~isolated toarea ~~cooperate~~must ~~with~~be ~~manufacturers~~maintained ofbetween ~~electric~~production facilities ~~bicycles~~ and toresidential deliver small lots of pre-launch lithium-ion batteries to them in order to explore the market, as well as to obtain feedback from electric bicycle customers to further improve our production technology of lithium-ion batteriesareas. We From ~~are currently monitoring and studying~~ the ~~market~~beginning ~~development~~ of ~~lithium-ion batteries including~~May, ~~but~~the ~~not~~Zhejiang ~~limited~~Environmental ~~to,~~Protection ~~technology~~Bureau ~~development,~~(the ~~market~~“ZEPB”) conducted ~~demand~~an ~~and~~environmental ~~relevant~~sanitation ~~supporting~~investigation ~~facilities.~~at Weour ~~will~~plant ~~continue~~at ~~monitor~~Jing’er ~~the~~Road ~~development~~ of ~~our lithium-ion project in~~ Changxing County, (Zhejiang Province), ~~and to adjust our execution plan accordingly~~(“Plant B”). ~~Until~~The ~~these~~results ~~products~~showed ~~are~~that ~~formally~~the ~~launched~~sewage and ~~distributed~~exhaust ~~into~~complied ~~the~~with ~~marketplace,~~national ~~their~~standards ~~effects~~in onChina, ~~our~~however, ~~business~~the ~~are~~Company ~~uncertain. We~~is do not maintaining ~~have~~the ~~any~~500 ~~specific~~meter ~~timetable~~isolated ~~for~~area ~~this~~between ~~strategy~~production asfacilities ~~we consider expanding our offering of highly efficient battery products to be part of our core business,~~ and ~~the~~residential ~~amounts we decide to allocate to this strategy will be funded by our operating cash flows~~areas.

~~Augment~~After ~~Marketing~~discussion with the Government, our battery charging activities and ~~Promotion~~packing ~~Efforts~~activities were permitted to ~~Increase~~keep ~~Brand~~operating ~~Awareness~~until December 31, 2011, however all other production activities were forced to stop pursuant to the tightened environmental policy on or before July 15, 2011. During the nine months ended December 31, 2011, we were further advised by the local authority of Changxing County that we could continue our charging activities and packing activities in Plant B through October 31, 2012. Management believes that our production facilities could not fully comply with the adjusted environmental policy as the residential area near Plant B showed (and continues to show) no signs of slowing its expansion towards Plant B, which is out of the Company’s control. As a result, we decided to scale down our operations at Plant B and relocate such production facilities to Plant D in Xuyi County, Jiangsu Province (as described below). We ceased all production activities, apart from battery charging activities and packing activities, during the period ended September 30, 2011. We did not suffer any penalty due to this tightened environmental protection policy. However, part of our production facilities in Plant B cannot be adequately transferred and implemented into our new production facility at Plant D, and we incurred an impairment loss of such facilities of US$1,848,000 during the nine months ended December 31, 2011.

~~The~~As ~~Company~~of ~~works~~the ~~with~~date ~~leading~~of ~~national~~this ~~brand designing companies to establish a complete plan for scientific branding~~report, the ~~which~~Government ~~use~~preliminarily ~~cartoon~~agreed ~~image endorsements~~ to ~~promote~~re-designate the ~~its~~land ~~corporate~~in ~~image,~~Changxing ~~products~~County ~~and~~to ~~brand awareness, through television and printed advertisements. Furthermore, we believe CCEC has established for~~ us ~~a positive social image across China as the official batteries supplier~~ for ~~electric~~redevelopment. ~~bicycles~~Prior ~~used~~to in the new ~~Beijing~~plant ~~Olympic and Paralympics Games~~ in ~~2008~~Changxing ~~and the alternative power source sponsor of the 2010 Shanghai World Expo. We do not have any specific timetable for this strategy as we consider~~County ~~augmenting~~being ~~our marketing and promotional efforts to increase brand awareness to be part of our core business~~built, ~~and the amounts~~ we ~~decide~~mainly toconduct ~~allocate~~lead-acid tobattery ~~this~~production ~~strategy~~activities ~~will~~in ~~be funded by our operating cash flows~~Plant D.

Expand ~~Sales~~Offering ~~Network~~of ~~and~~Highly ~~Distribution~~Efficient ~~Channels~~Battery Products

WeFor future market development, we intend to focus ~~put~~on the lithium-ion battery, which is a new product trend in ~~more~~the ~~resources~~European, toUS ~~expand~~and ~~our~~Japanese ~~sales~~markets, on electric vehicle power batteries and ~~distribution~~on ~~networks~~energy ~~by:~~storage ~~(1)~~batteries ~~adding~~dedicated to solar and wind power. We are currently committed to investing in and constructing new ~~distributors~~production facilities in ~~key~~Changxing ~~sales~~County ~~regions~~(Zhejiang Province) and in ~~China;~~Xuyi County (2Jiangsu Province). Since the ~~developing~~Company ~~new~~is ~~marketing~~experienced ~~strategies~~in producing motive batteries for powering electric bicycles, the Company intends to bring the lithium-ion battery to market by focusing first on the market for lithium-ion batteries in ~~different~~electric ~~channels;~~bicycles. ~~(3)~~We ~~improving~~estimate ~~communication~~that ~~between~~our ~~sales~~lithium-ion batteries ~~teams~~will be launched and ~~distributors;~~distributed into the marketplace prior to March 31, 2013. The Company intends to cooperate with manufacturers of electric bicycles and to deliver small lots of pre-launch lithium-ion batteries to them in order to explore the market, as well as to obtain feedback from electric bicycle customers to further improve our production technology of lithium-ion batteries. We are currently monitoring and studying the market development of lithium-ion batteries including, but not limited to, technology development, market demand and relevant supporting facilities. We will continue monitor the development of our lithium-ion project in Changxing County (4Zhejiang Province), ~~improving~~and to adjust our ~~brand~~execution ~~awareness~~plan accordingly. Until these products are formally launched and ~~promotion~~distributed ~~effort~~into the marketplace, their effects on our business are uncertain. We do not have any specific timetable for this strategy as we consider expanding our ~~sales~~offering ~~network~~of ~~and~~highly ~~distribution~~efficient ~~channels~~battery products to be part of our core business, and the amounts we decide to allocate to this strategy will be funded by our operating cash flows.

~~Build~~Augment ~~Partnerships~~Marketing ~~with~~and ~~New~~Promotion ~~and~~Efforts ~~Existing~~to ~~Clients~~Increase Brand Awareness

WeThe ~~continue~~Company works with leading national brand designing companies to ~~build~~establish a ~~close~~complete plan for scientific branding, ~~mutually~~which ~~beneficial~~use cartoon image endorsements to promote its corporate image, products and ~~harmonious~~brand ~~partnership~~awareness, ~~with~~through ~~our~~television ~~existing~~and ~~factory~~printed ~~customers~~advertisements. WeFurthermore, ~~aim~~we tobelieve ~~establish~~CCEC ahas ~~win-win~~established for ~~long-term~~us ~~partnership~~a ~~with~~positive ~~all~~social ofimage ~~our~~across ~~new~~China ~~customers. We~~as ~~intend~~the toofficial ~~continue~~batteries tosupplier ~~utilize~~for ~~our~~electric ~~customer~~bicycles ~~relationship~~used ~~management~~in tothe ~~provide~~Beijing ~~tailor-made~~Olympic and ~~management~~Paralympics ~~policies~~Games ~~that~~in ~~focus~~2008 and the ~~needs~~alternative power source sponsor of ~~different~~the ~~customers~~2010 Shanghai World Expo. We do not have any specific timetable for this strategy as we consider augmenting ~~building~~our marketing ~~partnerships~~and ~~with~~promotional ~~new~~efforts ~~and~~to ~~existing~~increase ~~clients~~brand awareness to be part of our core business, and the amounts we decide to allocate to this strategy will be funded by our operating cash flows.

- 29 27-

~~Vertical~~Expand ~~Integration~~Sales ~~Strategy~~Network and Distribution Channels

~~During~~We ~~the~~intend ~~period~~to ~~ended~~put ~~September~~in ~~30,~~more ~~2011,~~resources weto ~~have~~expand our ~~implemented~~sales aand ~~vertical~~distribution ~~integration~~networks ~~strategy~~by: of(1) ~~producing~~adding ~~lead~~new ~~plates~~distributors atin ~~Plant~~key Dsales ~~which~~regions ~~has~~in ~~enabled~~China; us(2) todeveloping ~~reduce~~new ~~processing~~marketing strategies ~~costs. Additionally,~~in ~~due~~different tochannels; ~~the~~(3) ~~implementation~~improving ofcommunication ~~the~~between ~~above~~sales ~~stated~~teams ~~environmental~~and ~~policy,~~distributors; ~~hundreds~~and of(4) improving our ~~competitors~~brand awareness ~~that~~and ~~are~~promotion ~~small~~effort. We ~~and~~do ~~medium~~not ~~size~~have ~~battery~~any ~~manufacturers~~specific ~~have~~timetable ~~been~~for ~~forced~~this tostrategy ~~shut~~as ~~down~~we orconsider toexpanding ~~stop~~our ~~operations. As~~sales network aand ~~result,~~distribution ~~the~~channels ~~shortage~~to ofbe ~~supply~~part of ~~lead~~our ~~acid~~core ~~batteries~~business, ~~has~~and ~~armed~~the usamounts ~~with~~we ~~strategic~~decide ~~bargaining~~to ~~power~~allocate ~~when~~to ~~negotiating~~this ~~the~~strategy ~~sales~~will be ~~price~~funded ofby our ~~products~~operating ~~with~~cash ~~customers~~flows.

~~Critical~~Build ~~Accounting~~Partnerships ~~Policies,~~with ~~Estimates~~New and ~~Assumptions~~Existing Clients

~~For~~We ~~the~~continue ~~six~~to ~~months~~build ~~ended~~a ~~September 30~~close, ~~2011,~~mutually ~~there~~beneficial and ~~were~~harmonious nopartnership ~~changes~~with inour ~~the~~existing ~~methodology~~factory ~~for~~customers. We ~~computing~~aim ~~critical~~to ~~accounting~~establish ~~estimates,~~a nowin-win ~~additional~~long-term ~~accounting~~partnership ~~estimates~~with all ~~met~~of our new customers. We intend to continue to utilize our customer relationship management to provide tailor-made management policies that focus the ~~standards~~needs of different customers. We do not have any specific timetable for ~~critical~~this ~~accounting~~strategy ~~policies~~as we consider building partnerships with new and existing clients to be part of our core business, and ~~there~~the ~~were~~amounts nowe ~~material~~decide ~~changes~~to allocate to ~~the~~this strategy ~~important~~will ~~assumptions~~be ~~underlying~~funded ~~the~~by ~~critical~~our ~~accounting~~operating ~~estimates.~~cash flows.

~~Recent~~Vertical ~~Accounting~~Integration ~~Pronouncements~~Strategy

InDuring ~~September 2011,~~ the ~~Financial~~period ~~Accounting~~ended ~~Standard~~December ~~Board~~31, ~~(“FASB”) issued Accounting Standards Update (“ASU”)~~ 2011~~-08~~, ~~“Intangibles~~we have –implemented ~~Goodwill~~a ~~and~~vertical ~~Other~~integration ~~(Topic~~strategy ~~350): Testing goodwill for impairment”. This ASU permits an entity to first assess qualitative factors to determine whether it is more likely than not that the fair value~~ of aproducing ~~reporting~~lead ~~unit~~plates isat ~~less~~Plant ~~than~~D ~~its~~which ~~carrying~~has ~~amount~~enabled asus ~~a basis for determining whether it is necessary~~ to ~~perform~~reduce ~~the two-step goodwill impairment test~~processing costs. ~~The more-likely-than-not threshold is defined as having a likelihood of more than 50 percent. Under ASU 2011-08~~ Additionally, andue ~~entity is not required~~ to ~~calculate~~ the ~~fair~~implementation ~~value~~ of ~~a reporting unit unless~~ the ~~entity~~above ~~determines~~stated ~~that~~environmental itpolicy, ishundreds ~~more~~of ~~likely~~our ~~than not~~ competitors that ~~its~~are ~~fair~~small ~~value~~and ismedium ~~less~~size ~~than~~battery ~~its~~manufacturers ~~carrying~~have ~~amount.~~been ~~ASU~~forced ~~2011-08~~to isshut ~~effective~~down ~~for~~or ~~annual~~to ~~periods~~stop ~~beginning~~operations. As ~~after~~a ~~December 15~~result, the ~~2011.~~shortage ~~The~~of ~~Company~~supply ~~believes~~of ~~that~~lead ~~the~~acid ~~adoption~~batteries ofhas ~~ASU~~armed ~~2011-08~~us ~~will~~with ~~not~~strategic ~~have~~bargaining ~~any~~power ~~material~~when ~~impact~~negotiating on the ~~Company's~~sales ~~consolidated~~price ~~results~~ of our ~~operation~~products ~~and~~with ~~financial condition~~customers.

~~Results~~Critical ofAccounting ~~Operations for the Three Months Ended September 30~~Policies, ~~2011~~Estimates ~~Compared~~and ~~With the Three Months Ended September 30, 2010~~Assumptions

~~The~~For ~~following~~the ~~table~~nine ~~sets~~months ~~forth~~ended aDecember ~~summary~~31, of2011, there ~~certain~~were ~~key~~no ~~components~~changes ofin ~~our~~the ~~results~~methodology offor ~~operations~~computing ~~for~~critical ~~periods~~accounting ~~indicated~~estimates, inno ~~U.S.~~additional ~~Dollars~~accounting estimates met the standards for critical accounting policies, and asthere awere ~~percentage~~no ofmaterial ~~revenues~~changes to the important assumptions underlying the critical accounting estimates.

	For The Three Months ended September 30 (Unaudited)
	(in thousands)
	2011 (US$)			2010 (US$)			2011			2010
Revenues		36,422			76,613			100.00	%		100.00	%
Cost of sales		(29,859	)		(65,869	)		81.98	%		85.98	%
Gross income		6,563			10,744			18.02	%		14.02	%
Sales, marketing and distribution		(2,121	)		(3,040	)		5.82	%		3.97	%
General and administrative expenses		(2,080	)		(956	)		5.71	%		1.25	%
Operating income		2,362			6,748			6.49	%		8.81	%
Other income, net		213			110			0.58	%		0.14	%
Interest income		402			102			1.10	%		0.13	%
Net income from operations before interest and tax expenses		2,977			6,960			8.17	%		9.08	%
Interest expenses		(1,555	)		(606	)		4.27	%		0.79	%
Income before income taxes		1,422			6,354			3.90	%		8.29	%
Income taxes expenses		(531	)		(912	)		1.46	%		1.19	%
Income before extraordinary items		891			5,442			2.45	%		7.10	%
Extraordinary gain (less applicable taxes of US$0)		-			-			-	%		-	%
Extraordinary loss (less applicable taxes of US$0)		-			-			-	%		-	%
Net income including non-controlling interest		891			5,442			2.45	%		7.10	%
Net income attributable to non-controlling interest		(11	)		-			0.03	%		-	%
Net income attributable to CIEC common shareholders		880			5,442			2.42	%		7.10	%
Other comprehensive income		625			433			1.72	%		0.57	%
Comprehensive income		1,505			5,875			4.13	%		7.67	%

Recent Accounting Pronouncements

In December 2011, the Financial Accounting Standard Board (“FASB”) issued Accounting Standards Update (ASU) 2011-11, 30“Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities”. The amendments in this ASU require an entity to disclose information about offsetting and related arrangements on its financial position. This includes the effect or potential effect of rights of offset associated with an entity’s recognized assets and recognized liabilities and require improved information about financial instruments and derivative instruments that are either (1) offset in accordance with Section 210-20-45 or Section 815-10-45 or (2) subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are offset in accordance with Section 210-20-45 or Section 915-10-45. The amendments are effective for annual reporting periods beginning on or after January 1, 2013 and retrospective disclosure is required for all comparative periods presented. No early adoption is permitted. The Company believes that the adoption of ASU 2011-11 will not have any impact on the Company's consolidated results of operation and financial condition.

~~Revenues~~Results ~~and~~of ~~Cost~~Operations offor ~~Sales~~the Three Months Ended December 31, 2011 Compared With the Three Months Ended December 31, 2010

~~Revenue~~The ~~decreased~~following bytable ~~US$40,191,000,~~sets orforth ~~52.46%,~~a tosummary ~~US$36,422,000~~of certain ~~for~~key ~~the~~components ~~three months ended September 30, 2011 compared with US$76,613,000 for the three months ended September 30, 2010. This decrease was mainly attributable to the decrease~~ of ~~production~~our ~~activities~~results ~~resulting from an unexpected tightening~~ of anoperations ~~environmental~~for ~~protection~~periods ~~policy enforced on all lead-acid battery manufacturers implemented by the PRC Central Government during the period ended June 30~~indicated, ~~2011.~~in ~~Pursuant to the tightened policy, a 500 meter isolated area must be maintained between production facilities and residential areas~~U. ~~All production facilities must comply with this policy on or before July 15, 2011~~S. ~~Our~~Dollars ~~production facilities at Plant B at Jing’er Road are not in compliance with the tightened environmental policy~~ and ~~the~~as ~~residential~~a ~~area~~percentage ~~nearby Plant B shows no signs~~ of ~~slowing its expansion towards Plant B, which is out of the Company’s control~~revenues. Our management decided to gradually scale down the operations of Plant B and to relocate such production facilities to Plant D before December 31, 2011. However, we are permitted by the government to continue to conduct our battery charging activities and packing activities until December 31, 2011.

Cost of sales for the three months ended September 30, 2011 and 2010 were US$29,859,000 and US$65,869,000, respectively. The decrease in cost of sales of US$36,010,000, or 54.67%, was mainly due to a decrease in sales volume resulting from the unexpected tightening of the environmental protection policy implemented by the PRC Central Government as stated above.-28-

Our gross profit ratio increased by 4.00% to 18.02% for the three months ended September 30, 2011 when comparing with the same period in 2010. The increase in gross profit ratio was mainly attributable to the decrease of the price of our chief raw material, lead, as well as the increase in the sales price of our products. During the period ended September 30, 2011, (a) we have implemented a vertical integration strategy of producing lead plates at Plant D which has enabled us to reduce the processing costs of our products and (b) due to the implementation of the environmental policy discussed above, hundreds of our competitors that are small and medium size battery manufacturers have been forced to shut down or to stop operations. As a result, the shortage of supply of lead acid batteries has armed us with strategic bargaining power when negotiating the sales price of our products with customers.

	For The Three Months ended December 31 (Unaudited)
	(in thousands)
	2011 (US$)			2010 (US$)			2011			2010
Revenues		35,160			67,670			100.00	%		100.00	%
Cost of sales		(28,073	)		(59,200	)		79.84	%		87.48	%
Gross income		7,087			8,470			20.16	%		12.52	%
Sales, marketing and distribution		(2,390	)		(2,560	)		6.80	%		3.78	%
General and administrative expenses		(2,812	)		(987	)		8.00	%		1.46	%
Operating income		1,885			4,923			5.36	%		7.28	%
Other income, net		418			276			1.19	%		0.41	%
Loss on disposal of scrap inventories		(6,092	)		(2,307	)		17.33	%		3.41	%
Provision for inventories		(5,431	)		-			15.45	%		-	%
Interest income		479			117			1.36	%		0.17	%
Net (loss) income from operations before interest and tax expenses		(8,741	)		3,009			24.86	%		4.45	%
Interest expenses		(2,009	)		(940	)		5.71	%		1.39	%
(Loss) Income before income tax expenses		(10,750	)		2,069			30.57	%		3.06	%
Income taxes benefit (expense)		434			(1,260	)		1.23	%		1.86	%
(Loss) Income before extraordinary items		(10,316	)		809			29.34	%		1.20	%
Extraordinary gain (less applicable taxes of US$0)		-			1,738			-	%		2.57	%
Net (loss) income including non-controlling interest		(10,316	)		2,547			29.34	%		3.76	%
Net (income) attributable to non-controlling interest		(53	)		-			0.15	%		-	%
Net (loss) income attributable to CIEC common shareholders		(10,369	)		2,547			29.49	%		3.76	%
Other comprehensive income		256			561			0.73	%		0.83	%
Comprehensive (loss) income		(10,113	)		3,108			28.76	%		4.59	%

~~Depreciation~~Revenues and ~~Amortization~~Cost of Sales

~~Depreciation~~Revenue ~~and~~decreased ~~amortization~~by ~~expense~~US$32,510,000, or 48.04%, to $35,160,000 for the three months ended ~~September~~December 3031, 2011 ~~and~~compared ~~2010~~with ~~were~~ US$~~238~~67,670,000 ~~and~~for ~~US$288~~the three months ended December 31,~~000,~~ ~~respectively~~2011. ~~The~~ This decrease was mainly attributable to the decrease of ~~US$50~~production activities resulting from an unexpected tightening of an environmental protection policy enforced on all lead-acid battery manufacturers implemented by the PRC Central Government during the period ended December 31,~~000~~ 2011. Pursuant to the tightened policy, ora 17500 meter isolated area must be maintained between production facilities and residential areas.~~36%~~ All production facilities must have complied with this policy on or before July 15, ~~was~~2011. ~~mainly~~Our ~~due~~production tofacilities ~~the~~at ~~impairment~~Plant B at Jing’er Road are not capable of ~~property,~~being ~~plant~~in full compliance with the tightened environmental policy and ~~equipment~~the atresidential area near Plant B shows no signs of slowing its expansion towards Plant B, which ~~cannot~~is beout ~~adequately~~of ~~transferred~~the ~~and~~Company’s ~~implemented~~control. ~~into~~Our ~~our~~management ~~new~~decided to gradually scale down the operations of Plant B and to relocate such production ~~facility~~facilities atto Plant D, apart from recharging and packing activities, before December 31, 2011. During the three months ended December 31, 2011, we were advised by the government that our recharging and packing activities in Plant B may continue through October 31, 2012.

~~General~~Although ~~and~~our ~~Administrative~~production capacities ~~Expenses~~gradually recovered, our major competitors had temporarily eroded our market share during the reporting period. As such, our revenue decreased significantly.

~~General~~Cost ~~and~~of ~~administrative~~sales ~~expenses~~for the three months ended December 31, 2011 and 2010 were US$228,~~080~~073,000 and US$~~956~~59,200,000, ~~for~~respectively. ~~the~~The ~~three~~decrease ~~months~~of ~~ended~~cost ~~September~~of ~~30,~~sales ~~2011~~of ~~and~~US$31,127,000 ~~2010~~or 52.58%, was ~~respectively~~mainly attributable to a decrease in sales volume resulting from the unexpected tightening of the environmental protection policy implanted by the PRC Central Government as stated above. ~~Such~~The ~~expenses~~decrease ~~mainly~~of ~~consisted~~cost of ~~research~~sales ~~and~~was ~~development,~~also ~~staff~~attributable ~~salaries~~to ~~and~~a ~~benefits~~significant decrease of processing charges on lead plates, ~~consultancy~~one of our major components of battery products, ~~taxes~~resulting ~~and~~from ~~depreciation~~our ~~expenses~~vertical integration strategy of producing lead plates at Plant D commencing August 2011.

~~The~~Our ~~increase~~gross ofprofit ~~our~~ratio ~~general~~increased ~~and administrative expenses~~ by ~~US$1,124,000,~~7.64% ~~or 117~~to 20.5716%, for the three months ended ~~September~~December 3031, 2011 as compared towith the same period in 2010. ~~was~~The ~~mainly attributable to: (a) an~~ increase ofin ~~US$502,000~~gross ~~for~~profit ~~the~~ratio was ~~staff~~mainly ~~salaries~~attributable ~~and relevant benefits, such as staff cafeteria expenses and social insurance, due~~ to the ~~operation~~decrease ~~of a new plant~~ in ~~Xuyi~~the ~~County~~cost of ~~Jiangsu~~production ~~Province~~as ~~where we~~a ~~have~~result ~~employed~~of ~~more administrative staff. On~~ the ~~other~~implementation ~~hand,~~of ~~due~~vertical tointegration ~~the~~strategy by ~~relocation~~processing ~~activities,~~ the ~~cafeteria~~lead atplates ~~Plant A was demolished and the cafeteria~~ at our Plant D ~~was~~in ~~under~~Jiangsu ~~construction~~Xuyi during the period, ~~and~~ended ~~therefore~~December ~~a catering service was outsourced to third parties resulting in a significant increase in staff cafeteria costs; (b) an increase in research and development expenses of US$211~~31,~~000,~~ ~~which~~2011. Since ~~are mainly attributable to~~ the ~~resources~~lead ~~invested~~plate inis ~~improving~~one ~~the quality~~ of ~~existing products as well as the development of new products and the increase in staff in~~ our ~~R&D~~major ~~department;~~components ~~and~~to ~~(c)~~produce anlead ~~increase~~acid ~~in staff accident insurance for the Company of US$109~~batteries,~~000;~~ ~~since~~this ~~the~~strategy ~~Company~~significantly decreased ~~provided free shuttle bus services between Jiangsu and Zhejiang for its staff every week, and in order to protect~~ our ~~staff~~cost ~~benefit,~~of ~~the Company arranged additional traffic accident insurance during the period~~production.

- 31 29-

~~Sales,~~The ~~Marketing~~increase ~~and~~in ~~Distribution~~gross profit ratio was also attributable to the increase in the selling price.

~~Sales,~~During ~~marketing and distribution expenses for~~ the ~~three~~period ~~months~~ ended ~~September~~December 3031, 2011 ~~and 2010 were US$2~~,~~121,000~~ the ~~and~~implementation ~~US$3,040,000,~~of ~~respectively. The~~environment ~~decrease~~policy ofdiscussed ~~sales,~~above ~~marketing~~has ~~and~~forced ~~distribution~~hundreds ~~expenses~~ of ~~US$919,000,~~our orcompetitors ~~30.23%,~~which ~~was~~are ~~mainly~~small ~~attributable~~and tomedium sized ~~the~~battery ~~decrease~~manufacturers ofto ~~transportation~~shut ~~expenses~~down ofor ~~US$658,000~~to ~~and~~stop ~~commission~~operations. ~~expenses~~As ofa ~~US$69~~result,~~000.~~ ~~The~~there ~~decrease~~is ofsignificant ~~transportation~~shortage ~~expenses~~of battery supply and ~~commission~~we ~~expenses~~currently ~~was~~have ~~mainly~~strong ~~due~~bargaining topower over the ~~decrease of~~ selling ~~activities~~price ~~resulting~~with ~~from~~our ~~the implementation of the tightened environmental policy as stated above~~customers.

~~Interest~~Depreciation ~~Income~~and Amortization

~~Interest~~Depreciation ~~income~~and amortization expense for the three months ended ~~September~~December 3031, 2011 and 2010 ~~was~~were US$~~402~~1,173,000 and US$~~102~~267,000, respectively. The increase of US$~~300~~906,000, or ~~294~~339.1233%, was mainly attributable to the ~~increase~~additional indepreciation charged during the ~~average~~period, ~~deposit~~which ~~interest~~amounted ~~rate~~to US$452,000, ~~from~~as 1a result of the change of estimated useful life on certain machinery at Plant B in Changxing County.~~83%~~ During the three months ended December 31, 2011 we were advised by the local authority that we are not allowed to 3.produce battery products using our current production technique, external battery formation, in our production facility after October 31%, as2012. ~~well~~Our asmanagement anreviewed ~~increase~~the machinery in ~~restricted~~Plant ~~cash~~B ~~pledged~~and ~~for~~identified ~~notes~~that ~~granted~~certain bymachinery ~~banks~~cannot be used after that date and therefore, their estimated useful life was adjusted.

~~Income~~In ~~before~~addition, ~~Interest~~in order to expand our production capacity, we have invested significantly in plant and ~~Income~~machinery ~~Tax~~at ~~Expenses~~Plant D in Jingsu Xuyi during the period ended December 31, 2011. The total cost of property, plant and equipment increased US$35,963,000 or 191.96% to US$54,698,000 as of December 31, 2011 compared with US$18,735,000 as of March 31, 2011. At the same time, the increase in depreciation expense was in line with the increase in the property, plant and equipment.

~~Income~~General ~~before interest~~ and ~~income~~Administrative tax expenses was for the three months ended September 30, 2011 and 2010 was US$1,422,000 and US$6,354,000, respectively. The decrease of US$4,932,000, or 77.62%, was mainly attributable to the decrease in revenue during the period.Expenses

~~Interest~~General ~~Expense~~and administrative expenses were US$2,812,000 and US$987,000 for the three months ended December 31, 2011 and 2010, respectively. Such expenses mainly consisted of research and development, staff salaries and benefits, consultancy and depreciation expenses.

~~Interest~~The ~~expense~~increase in general and administrative expenses of US$1,825,000 or 184.90% for the three months ended ~~September~~December 3031, 2011 ~~and~~as compared to the same period in 2010 was mainly attributable to: (a) an increase of US$1467,~~555,~~000 for staff salaries and ~~US$606~~relevant benefits,~~000~~ such as social insurance and staff cafeteria expenses, ~~respectively. The~~due to the operation of a new plant in Xuyi County of Jiangsu Province where we now employ more administrative staff; (b) an increase in ~~interest~~research ~~expense~~ and development expenses of US$~~949~~464,000, orwhich ~~156.60%, was~~ are mainly attributable to the ~~increase~~resources ofinvested ~~banking~~in ~~facilities~~improving ~~utilized~~the byquality ~~the~~of ~~Company~~existing products as well as the development of new products and the increase in ~~interest~~staff ~~rate~~in our R&D department; (c) an increase of US$189,000 for the tax expense including property tax, stamp duty etc due to the establishment of Plant D; and (d) an increase of US$294,000 in other expense as a result of the establishment of Plant D.

~~Income~~Sales, ~~Taxes~~Marketing ~~Expenses~~and Distribution

~~Income~~Sales, ~~taxes~~marketing and distribution expenses for the three months ended ~~September~~December 3031, 2011 and 2010 ~~was~~were US$~~531~~2,390,000 and US$~~912~~2,560,000, respectively. The decrease ~~in income taxes expenses~~ of US$~~381~~170,000, or 41 6.7864%, was mainly attributable to ~~the~~a decrease in ~~revenue~~transportation ~~during~~expense of US$467,000, offset by the ~~period~~increase in exhibition expense of US$243,000.

~~Net~~Loss ~~Income~~on ~~Including~~Disposal ~~Non-Controlling~~of ~~Interest~~Scrap Inventories and Provision for Inventories

~~Net~~During ~~income~~the ~~was~~three ~~US$891,000~~months ~~and~~ended ~~US$5~~December 31,~~442,000~~ 2011 ~~for~~we ~~the~~have ~~three~~recorded ~~months~~a ~~ended~~loss ~~September~~on ~~30,~~disposal ~~2011~~of scrap inventories and ~~2010,~~made ~~respectively. The~~provision ~~decrease~~on ofobsolete inventories amounting to US$46,~~551~~092,000, orand ~~83.63%~~US$5,431,000, ~~was~~respectively. ~~mainly~~Comparing ~~attributable~~with to the ~~decrease~~three inmonths ~~operating~~ended ~~income~~December of31, ~~US$4~~2010,~~386,000~~ asthe ~~compared~~loss toon ~~the~~disposal ~~same~~of scrap ~~period~~inventories increased inby ~~2010~~US$3,785,000 or 164.07%.

- 32 30-

~~Results~~The losses on disposal of scrap ~~Operations~~inventories and provision for inventories were mainly attributable to the ~~Six~~tightened ~~Months~~environmental ~~Ended~~policy ~~September~~advised 30by the local authority of Changxing County that our current production technique, ~~2011~~external ~~Compared~~battery ~~With~~formation, in Plant B in Changxing County was not allowed to be used in our production facilities after October 31, 2012. Plant B is the ~~Six~~only ~~Months~~facility for ~~Ended~~repairing ~~September~~returned 30batteries which were produced under external battery formation. After analyzing the future return rate of the batteries and our existing inventory levels, ~~2010~~management considered that our production capacity was not enough to repair all future returned batteries and existing inventories. Management decided to dispose of the obsolete inventories and made provision on the obsolete inventories to be disposed of in the future.

~~The~~Interest ~~following table sets forth a summary of certain key components of our results of operations for periods indicated, in dollars and as a percentage of revenues.~~Income

	For The Six Months ended September 30 (Unaudited)
	(in thousands)
	2011 (US$)			2010 (US$)			2011			2010
Revenues		71,821			127,042			100.00	%		100.00	%
Cost of sales		(63,323	)		(111,260	)		88.17	%		87.58	%
Gross income		8,498			15,782			11.83	%		12.42	%
Sales, marketing and distribution		(4,641	)		(5,551	)		6.46	%		4.37	%
General and administrative expenses		(3,785	)		(1,641	)		5.27	%		1.29	%
Operating income		72			8,590			0.10	%		6.76	%
Other income, net		201			613			0.28	%		0.48	%
Interest income		705			198			0.98	%		0.16	%
Net income from operations before interest and tax expenses		978			9,401			1.36	%		7.40	%
Interest expenses		(2,837	)		(1,291	)		3.95	%		1.02	%
(Loss) Income before income taxes		(1,859	)		8,110			2.59	%		6.38	%
Income taxes expenses		(82	)		(1,161	)		0.11	%		0.91	%
(Loss) Income before extraordinary items		(1,941	)		6,949			2.70	%		5.47	%
Extraordinary gain (less applicable taxes of US$0)		13,053			-			18.17	%		-	%
Extraordinary loss (less applicable taxes of US$0)		(1,840	)		-			2.56	%		-	%
Net income including non-controlling interest		9,272			6,949			12.91	%		5.47	%
Net income attributable to non-controlling interest		(11	)		-			0.02	%		-	%
Net income attributable to CIEC common shareholders		9,261			6,949			12.89	%		5.47	%
Other comprehensive income		1,041			554			1.45	%		0.44	%
Comprehensive income		10,302			7,503			14.34	%		5.91	%

Interest income for the three months ended December 31, 2011 and 2010 was US$479,000 and US$117,000, respectively. The increase of US$362,000 or 309.40%, was mainly attributable to the increase in the average deposit interest rate as well as an increase in restricted cash pledged for notes granted by banks.

~~Revenues~~(Loss) Income before Interest and ~~Cost~~Income ofTax ~~Sales~~Expenses

~~Revenues~~Loss ~~decreased~~before byinterest and ~~US$55,221,000,~~income ortax ~~43.47%,~~expenses ~~to US$71,821,000~~ for the ~~six~~three months ended ~~September~~December 3031, 2011 was US$8,741,000 as compared with an income of US$~~127~~3,~~042~~009,000 for the ~~six~~three months ended ~~September~~December 3031, 2010. ~~This~~ ~~decrease~~The ~~was mainly attributable to the~~ decrease of production activities resulting from an unexpected tightening of an environmental protection policy enforced on all lead-acid battery manufacturers implemented by the PRC Central Government during the period ended June 30US$11,750,000 ~~2011.~~was ~~Pursuant~~mainly attributable to the increase ~~tightened~~in ~~policy,~~loss ~~a 500 meter isolated area must be maintained between production facilities and residential areas. All production facilities must comply with this policy~~ on ~~or before July 15, 2011. Our production facilities at Plant B at Jing’er Road are not in compliance with~~ the ~~tightened~~disposal ~~environmental policy and the residential area nearby Plant B shows no signs~~ of ~~slowing~~scrap ~~its~~inventory ~~expansion towards Plant B, which is out of the Company’s control. Our management decided to gradually scale down the operations of Plant B~~ and toprovision ~~relocate~~for ~~such~~obsolete ~~production facilities to Plant D before December 31, 2011~~inventories. ~~However, we are permitted by the government to continue to conduct our battery charging activities and packing activities until December 31, 2011.~~

~~Cost~~Interest of sales for the six months ended September 30, 2011 and 2010 were US$63,323,000 and US$111,260,000, respectively. The decrease in cost of sales of US$47,937,000, or 43.09%, was mainly attributable to the decrease in sales volume resulting from the tightening of the environmental policy implemented by the PRC Central Government as stated above.Expense

-Interest 33expense -for the three months ended December 31, 2011 and 2010 was US$2,009,000 and US$940,000, respectively. The increase in interest expense of US$1,069,000, or 113.72%, was mainly attributable to the increase in banking facilities utilized by the Company as well as an increase in interest rate.

~~Our~~Income ~~gross~~Taxes ~~profit~~Benefits ratio decreased by 0.61% to 11.83% for the six months ended September 30, 2011 when comparing with the corresponding period of last year. The decrease was mainly attributable to the net effect of the following: (aExpenses) during the first quarter of 2011, the cost of our chief raw material, lead, as well as the processing fee charged on lead plates were increased as compared to the same period in 2010; therefore, our gross profit ratio decreased by 4.52% to 5.47% for the three months ended June 30, 2011; and (b) from the second quarter of 2011, we have successfully implemented a vertical integration strategy of producing lead plates at Plant D in Jiangsu Province, which has enabled us to reduce our processing costs; due to a shortage of supply of lead acid batteries in the market, we have increased the sales price of our products and as a result, the gross profit ratio increased by 4.00% to 18.02% for the three months ended September 30, 2011 as compared to the same period in 2010. As a result of the foregoing, the gross profit ratio for the six months ended September 30, 2011 decreased by approximately 0.61% when compared to the same period in 2010.

~~Depreciation~~Income taxes benefits for the three months ended December 31, 2011 was US$434,000 as compared to a tax expense of US$1,260,000 for the same period in 2010. The decrease in income taxes expense of US$1,694,000 was mainly attributable to the decrease in operating profit during the period and ~~Amortization~~the recognition of a deferred tax benefit on estimated unused tax losses.

~~Depreciation~~Net ~~and~~(Loss) ~~amortization~~Income ~~expenses~~Including ~~were~~Non-Controlling ~~US$542,000 and US$540,000 for the six months ended September 30, 2011 and 2010, respectively.~~Interest

~~During~~Net loss including non-controlling interest for the ~~six~~three months ended ~~September~~December 3031, 2011, wewas ~~were~~US$10,316,000 ~~forced~~as tocompared ~~relocate~~with ~~our~~a ~~production~~net ~~facilities~~income including atnon-controlling ~~Plant~~interest Bof toUS$2,547,000 ~~Plant~~for ~~D as a result of~~ the ~~tightened environmental~~ ~~protection~~corresponding ~~policy~~period ~~described~~in ~~above~~2010. ~~However,~~The ~~some~~decrease ofin ~~our~~income ~~equipment~~of US$12,863,000 atwas ~~Plant~~mainly Battributable ~~can~~to ~~no longer be used and were impaired during~~ the ~~period.~~increase Atin ~~the~~loss ~~same~~on ~~time, due to~~ the ~~increase~~disposal of ~~operations~~scrap ofinventory ~~our production facilities at Plant D~~US$3, ~~we acquired new property~~785,000 ~~plant~~ and ~~equipment~~a ~~during~~provision on ~~the~~obsolete ~~period.~~inventories ~~Therefore,~~of ~~the depreciation for the six months ended September 30, 2011 increased slightly to~~ US$25,~~000~~431, ~~or 0~~000.~~37%, as compared to the same period in 2010.~~

~~General~~Results ~~and~~of ~~Administrative~~Operations ~~Expenses~~for the Nine Months Ended December 31, 2011 Compared With the Nine Months Ended December 31, 2010

~~General~~The ~~and~~following ~~administrative~~table ~~expenses~~sets ~~were~~forth ~~approximately~~a ~~US$3,785,000~~summary ~~and~~of certain ~~US$1,641,000~~key ~~for~~components ~~the~~of ~~six~~our ~~months~~results ~~ended~~of ~~September~~operations 30for periods indicated, ~~2011~~in dollars and ~~2010,~~as ~~respectively~~a percentage of revenues.

The increase of US$2,144,000, or 130.65%, for the six months ended September 30, 2011 as compared to the same period in 2010 was mainly attributable to: (a) an increase of US$568,000 for staff salaries and benefits, such as staff cafeteria expenses and social insurance, due to the operation of new plant in Xuyi County of Jiangsu Province where we have employed more administrative staff. On the other hand, due to the relocation activities, the cafeteria at Plant A was demolished and the cafeteria at Plant D was under construction during the period, and therefore a catering service was outsourced to third parties resulting in a significant increase in staff cafeteria costs; (b) an increase in research and development expenses of US$383,000, which are mainly attributable to the resources invested in improving the quality of existing products as well as the development of new products and the increase in staff in our R&D department; (c) an increase in staff accident insurance for the Company of US$109,000; since the Company provided free shuttle bus services between Jiangsu and Zhejiang for its staff every week, and in order to protect our staff benefit, the Company arranged additional traffic accident insurance during the period; (d) increases in office supplies expenses of US$325,000 due to the replacement of the Company’s old office supplies during the relocation of our offices from Jingyi Road to Jing’er Road in Zhejiang Province; on the other hand, we have established a new office at Plant D in Jiangsu Province, which also increase the office supplies; and (e) increase in legal and professional fees of US$283,000 in connection with the filing of our Registration Statement on Form S-1, consultancy fees paid to US GAAP consultant and internal control consultant and an audit fee.

	For The Nine Months ended December 31 (Unaudited)
	(in thousands)
	2011 (US$)			2010 (US$)			2011			2010
Revenues		102,900			194,712			100.00	%		100.00	%
Cost of sales		(87,315	)		(170,460	)		84.85	%		87.54	%
Gross income		15,585			24,252			15.15	%		12.46	%
Sales, marketing and distribution		(7,031	)		(8,111	)		6.83	%		4.17	%
General and administrative expenses		(6,597	)		(2,628	)		6.41	%		1.35	%
Operating income		1,957			13,513			1.90	%		6.94	%
Other income, net		619			889			0.60	%		0.46	%
Loss on disposal of scrap inventories		(6,092	)		(2,307	)		5.92	%		1.18	%
Provision for inventories		(5,431	)		-			5.28	%		-	%
Interest income		1,184			315			1.15	%		0.16	%
Net (loss) income from operations before interest and tax expenses		(7,763	)		12,410			7.54	%		6.37	%
Interest expenses		(4,846	)		(2,231	)		4.71	%		1.15	%
(Loss) Income before income tax expenses		(12,609	)		10,179			12.25	%		5.23	%
Income taxes benefit (expense)		352			(2,421	)		0.34	%		1.24	%
(Loss) Income before extraordinary items		(12,257	)		7,758			11.91	%		3.98	%
Extraordinary gain (less applicable taxes of US$0)		13,117			1,738			12.75	%		0.89	%
Extraordinary loss (less applicable taxes of US$0)		(1,848	)		-			1.80	%		-	%
Net (loss) income including non-controlling interest		(988	)		9,496			0.96	%		4.88	%
Net (income) attributable to non-controlling interest		(64	)		-			0.06	%		-	%
Net (loss) income attributable to CIEC common shareholders		(1,052	)		9,496			1.02	%		4.88	%
Other comprehensive income		1,297			1,115			1.26	%		0.57	%
Comprehensive income		245			10,611			0.24	%		5.45	%

~~Sales, Marketing and Distribution~~-31-

~~Sales,~~Revenues ~~marketing~~ and ~~distribution~~Cost ~~expense were US$4,641,000 and US$5,551,000 for the six months ended September 30, 2011 and 2010, respectively. The decrease~~ of US$910,000 or 16.39% was mainly attributable to the decrease in selling activities due to the tightened environmental protection policy as mentioned above. The transportation expense, commission expense and warranty were decreased by US$957,000, US$159,000 and US$354,000, respectively. In order to maintain our brand image from the influence of the shortage of supply of our batteries products, we increased advertising expenses and other expenses of US$308,000 and US$117,000, respectively.Sales

-Revenues 34decreased by US$91,812 or 47.15%, to US$102,900,000 for the nine months ended December 31, 2011 compared with US$194,712,000 for the nine months ended December 31, 2010. This decrease was mainly attributable to the decrease of production activities resulting from an unexpected tightening of an environmental protection policy enforced on all lead-acid battery manufacturers implemented by the PRC Central Government during the period ended December 31, 2011. Pursuant to the tightened policy, a 500 meter isolated area must be maintained between production facilities and residential areas. All production facilities must have complied with this policy on or before July 15, 2011. Our production facilities at Plant B at Jing’er Road are not capable of being in full compliance with the tightened environmental policy and the residential area near Plant B shows no signs of slowing its expansion towards Plant B, which is out of the Company’s control. Our management decided to gradually scale down the operations of Plant B and to relocate such production facilities to Plant D, apart from recharging and packing activities, before December 31, 2011. During the three months ended December 31, 2011, we were advised by the government that our recharging and packing activities in Plant B may continue through October 31, 2012.

~~Other~~Although ~~Income~~our production capacities gradually recovered, ~~Net~~our major competitors had temporarily eroded our market share. As such, our revenue decreased significantly.

~~Other~~Cost ~~income,~~of ~~net~~sales ~~included~~for athe ~~gain~~nine months ~~from~~ended ~~disposal~~December of31, a2011 ~~wholly-owned~~and ~~subsidiary~~2010 ofwere US$~~506~~87,315,000 and US$170,460,000, respectively. AsThe decrease in cost of ~~May~~sales ~~27,~~of ~~2011~~US$83,145,000 or ~~Chisen~~48.78% ~~Electric~~was ~~has~~mainly ~~fully~~attributable ~~disposed~~to ~~its~~the ~~interest~~decrease in ~~Chisen~~sales ~~Technology~~volume ~~for~~resulting afrom ~~cash~~the ~~consideration~~unexpected tightening of ~~US$10. The~~the ~~fair~~environmental protection ~~value~~policy ofimplanted ~~Chisen~~by ~~Technology at~~ the ~~date~~PRC ofCentral ~~disposal~~Government ~~was~~as ~~net~~stated ~~liabilities of US$496~~above. The ~~disposal~~decrease of ~~Chisen~~cost ~~Technology~~of ~~has~~sales ~~had~~was noalso attributable to a significant ~~impact~~decrease of processing charges on ~~the~~lead ~~value~~plates, one of ~~the~~our ~~Group’s~~major ~~assets~~components of battery products, ~~operating~~resulting ~~cash~~from our ~~flows~~vertical asintegration ~~well~~strategy asof ~~earnings~~producing ~~per~~lead ~~share~~plates at Plant D commencing August 2011.

~~Interest~~Our ~~Income~~gross profit ratio increased by 2.69% to 15.15% for the nine months ended December 31, 2011 as compared with the corresponding period in 2010. The increase was mainly attributable to the decrease in the cost of production as a result of the implementation of the vertical integration strategy by processing the lead plates at our Plant D in Jiangsu Xuyi during the period ended December 31, 2011. Since the lead plate is one of our major components to produce lead acid batteries, this strategy significantly decreased our cost of production.

Interest income was US$705,000 and US$198,000 for the six months ended September 30, 2011 and 2010, respectively. The increase of US$507,000, or 256.06%, was mainly attributable to the increase in the average deposit interest rate from 1.71% to 2.85% as well as an increase in restricted cash pledged for notes granted by banks.-32-

~~Income~~The ~~before~~increase ~~Interest~~in ~~and~~gross ~~Income~~profit ~~Tax~~ratio ~~Expenses~~was also attributable to the increase in the selling price.

~~Income~~During ~~before~~the ~~interest~~period ~~and~~ended ~~income~~December ~~tax~~31, 2011, ~~expenses~~the ~~were~~implementation ~~US$978,000~~of ~~and~~environment ~~US$9,401,000~~policy ~~for~~discussed ~~the~~above ~~six~~has ~~months~~forced ~~ended~~hundreds ~~September~~of ~~30,~~our ~~2011~~competitors ~~and~~which ~~2010,~~are ~~respectively. The~~small ~~decrease~~and medium ofsized ~~US$8,423,000,~~battery ormanufacturers ~~89.60%,~~to ~~was~~shut ~~mainly~~down ~~due~~or to ~~the~~stop ~~decrease~~operations. inAs ~~sales~~a ~~from US$127~~result,~~042,000~~ ~~during~~there ~~the~~is ~~six~~a ~~months~~significant ~~ended~~shortage ~~September~~of battery ~~30,~~supply ~~2010~~and towe ~~US$71,821,000~~currently ~~during~~have ~~the~~strong ~~six~~bargaining ~~months~~power ~~ended~~over ~~September~~the ~~30,~~selling ~~2011~~price with our customers.

~~Interest~~Depreciation ~~Expense~~and Amortization

~~Interest~~Depreciation ~~expense was US$2,837,000~~ and amortization ~~US$1,291,000~~expenses for the ~~six~~nine months ended ~~September~~December 3031, 2011 and 2010 were US$1,412,000 and US$807,000, respectively. The increase ~~in interest expense~~ of US$1605,~~546,~~000, or ~~119~~74.7597%, was mainly attributable to the ~~increase~~additional indepreciation ~~our~~charged ~~borrowing~~during ~~amount~~the ofperiod which amounted to US$16452,~~871,~~000, ~~and~~as ~~the~~a ~~increase~~result of change of estimated useful life on certain machinery at Plant B in ~~interest~~Changxing ~~rate~~County. During ~~also~~the ~~caused~~nine months ended December 31, 2011 we were advised by the local authority that we are not allowed to produce battery products using our current production technique, external battery formation. In our production facility after October 31, 2012. Our management reviewed the ~~increase~~machinery in ~~interest~~Plant ~~expense~~B and identified that certain machinery cannot be used after that date and therefore, their estimated useful life was adjusted.

~~Income~~In ~~Taxes~~addition, ~~Expenses~~in order to expand our production capacity, we have invested significantly in plant and machinery at Plant D in Jingsu Xuyi during the period ended December 31, 2011. In order to recover our production capacity, the relevant depreciation was increased accordingly.

~~Income~~General ~~taxes expenses for the six months ended September 30, 2011~~ and ~~2010~~Administrative ~~was US$82,000 and US$1,161,000, respectively. The decrease in income taxes expenses of US$1,079,000, or 92.94%, was mainly attributable to the decrease in revenue during the period.~~Expenses

~~Extraordinary~~General ~~Gain~~and administrative expenses were approximately US$6,597,000 and US$2,628,000 for the nine months ended December 31, 2011 and 2010, respectively. Such expenses mainly consisted of research and development, staff salaries and benefits, consultancy and depreciation expenses.

~~During~~The ~~the~~increase ~~six~~in general ~~months~~and ~~ended~~administrative ~~September~~expenses ~~30,~~of ~~2011~~US$3,969,000 weor ~~completed the relocation of Plant A at Jingyi Road~~151.03% ~~Pursuant~~for to the ~~Compensation~~nine ~~Agreement~~months onended ~~Relocation~~December ~~and~~31, ~~Acquisition~~2011 ~~entered~~as ~~into~~compared byto ~~CCEC and~~ the corresponding ~~Administrative~~period ~~Committee~~in of2010 ~~Changxing~~was ~~Economic~~mainly ~~Development~~attributable ~~Zone~~to: (~~"ACC"~~a), ~~ACC~~an ~~shall~~increase ~~pay us compensation in the amount~~ of ~~RMB98,514,000 (~~US$151,~~278~~015,000) for ~~the~~staff ~~loss~~salaries ~~on long-term land lease prepayment~~ and ~~buildings~~benefits, such ~~located~~as atstaff ~~Jingyi~~cafeteria ~~Road.~~expenses Inand ~~May~~social ~~2011~~insurance, ~~the~~due ~~Company~~to ~~wrote-off~~ the ~~long-term~~operation ~~land~~of ~~lease~~our ~~prepayment~~new ~~and~~plant ~~buildings~~in atXuyi ~~Jingyi~~County ~~Road~~of ~~with~~Jiangsu Province awhere ~~net~~we ~~book~~now ~~value~~employ ofmore ~~approximately~~administrative ~~RMB14,354,000~~staff; ~~(US$2~~also,~~225,000)~~ ~~and~~due ~~therefore,~~to ~~net~~due ~~compensation~~to ~~income~~the ofrelocation ~~RMB$84~~activities,~~160,000~~ ~~(US$13,053,000)~~the cafeteria at Plant A was ~~recognized~~demolished ~~for~~and the ~~period.~~cafeteria ~~The~~at ~~transaction~~Plant ofD ~~relocation~~ was ~~considered~~completed asin anlate ~~involuntary~~2011, ~~conversion~~and oftherefore a ~~non-monetary~~catering ~~asset~~service ~~into~~was outsourced ato ~~monetary~~third ~~asset.~~parties ~~According~~resulting toin ~~ASC605-40-25,~~a tosignificant ~~the~~increase ~~extent~~in ~~the~~staff ~~cost~~cafeteria ofcosts; a(b) ~~nonmonetary~~an ~~asset~~increase ~~differs~~in ~~from~~research ~~the~~and development ~~amount~~expenses of ~~monetary~~US$968,000, ~~assets~~which ~~received,~~are ~~the~~mainly ~~result~~attributable ofto the ~~realization~~resources ofinvested ain ~~gain~~improving ~~from~~ the ~~transaction~~quality isof existing ~~recognized. The~~products ~~relocation~~as ~~activity~~well isas ~~abnormal and significantly different from~~ the ~~ordinary~~development ~~and typical activities~~ of ~~the~~new ~~Company~~products and isthe ~~not~~increase ~~expected~~in tostaff ~~recur~~ in ~~the~~our ~~foreseeable~~R&D ~~future.~~department; ~~According~~(c) ~~to ASC225-20, the Company classified the gain as~~ an increase ~~extraordinary~~in ~~item. Pursuant~~audit toand ~~the~~professional ~~Implementation~~fees ~~Regulations to the EIT law~~ of ~~the PRC~~US$229,000; ~~only~~and ~~the~~(d) ~~portion~~due ~~of compensation income exceeding the reinvestment amount related~~ to the ~~relocation~~establishment ~~was~~of ~~taxable.~~Plant ~~All~~D, ~~compensation income received by~~ the ~~Company~~general ~~would~~expenses including betax, ~~reinvested~~accident ~~into~~and ~~the~~general ~~fixed~~insurance, ~~assets~~repair and ~~long-term~~maintenance, ~~land~~utilities, ~~lease~~office ~~prepayment~~expense ofincreased ~~Plant~~by US$165,000, CUS$141,000 atUS$163,000, ~~Jingsi~~US$158,000 ~~Road~~ and ~~therefore~~US$240,000, ~~no income tax was applicable~~respectively.

-Sales, 35Marketing -and Distribution

~~Extraordinary~~Sales, ~~Loss~~marketing and distribution expense were US$7,031,000 and US$8,111,000 for the nine months ended December 31, 2011 and 2010, respectively. The decrease of US$1,080,000 or 13.32% was mainly attributable to the decrease in selling activities due to the tightened environmental protection policy as discussed above. Transportation expense decreased by US$1,416,000. In order to maintain our brand image from the influence of the shortage of supply of our batteries products, we increased advertising expenses and exhibition expenses of US$225,000 and US$243,000, respectively.

~~During~~ Loss on ~~the~~Disposal three months ended June 30, 2011 and without advance notice to the Company, the PRC Central Government tightened its environmental protection policy which applies to all lead-acid battery manufacturers. Pursuant to the new policy, a 500 meter isolated area must be maintained between production facilities and residential areas. From the beginning of ~~May,~~Scrap ~~the~~Inventories ~~Zhejiang Environmental Protection Bureau (ZEPB) conducted an environmental sanitation investigation at Plant B. The results showed that the sewage~~ and ~~exhaust~~Provision ~~complied~~for with national standards in China, however, the Company is not maintaining the 500 meter isolated area between production facilities and residential areas. The ZEPB requires all production facilities at Plant B to comply with and meet the adjusted environmental policy prior to July 15, 2011. However we were permitted by the government to continue to conduct our battery charging activities and packing activities until December 31, 2011. We have stopped all production activities, apart from battery charging activities and packing activities, during the period ended September 30, 2011. We did not suffer any penalty due to this tightened environmental protection policy. Inventories

AsLoss ofon ~~the~~disposal ~~date~~ of scrap ~~this~~inventories ~~report,~~and ~~the~~provision ~~Government~~on ~~preliminarily~~inventories ~~agreed to re-designate the land in Changxing County to us~~ for ~~redevelopment. Prior to~~ the ~~new~~nine ~~plant~~months inended ~~Changxing~~December ~~County being built~~31, ~~our~~2011 ~~lead-acid~~and ~~battery~~2010 ~~production~~were ~~will~~US$6,092,000 beand US$5,431,000, ~~relocated to Plant D~~respectively. ~~However,~~Compared ~~since~~with ~~Plant~~the Dnine ismonths ~~still~~ended ~~under~~December a31, ~~trial production stage~~2010, wethe ~~believe~~loss ~~our~~on ~~production~~disposal ~~capacity~~of ~~will~~scrap ~~not~~inventories increased ~~rebound~~by inUS$3,785,000 aor ~~short time which could continue to have an adverse effect on our business and operations~~164.07%.

As such, the impairment loss of some fixed assets, including plant and machinery together with a leasehold improvement of US$1,840,000, were recognized as an extraordinary loss. Management considers that this Government behavior is very unusual and thus the relevant impairment loss of plant and machinery was classified as an extraordinary item.-33-

~~Pursuant~~The losses on disposal of scrap inventories and provision for inventories were mainly attributable to the ~~Implementation~~tightened ~~Regulations~~environmental policy toadvised by the ~~EIT~~local ~~law~~authority of ~~the~~Changxing ~~PRC~~County that our current production technique, ~~the~~external ~~impairment~~battery ~~loss~~formation, in ~~can~~Plant ~~only~~B in Changxing County was not allowed to be ~~recognized~~used ~~when~~in ~~the~~our ~~relevant~~production ~~assets~~facilities ~~were~~after ~~disposed~~October 31, 2012. ~~Since~~Plant B is the only ~~actual~~facility ~~amount~~for ofrepairing ~~loss~~returned inbatteries which were produced under external battery formation. After analyzing the future return ~~cannot~~rate beof ~~assessed~~the ~~accurately~~batteries and our existing inventory levels, nomanagement ~~tax~~considered ~~benefit~~that our production capacity was ~~recognized~~not enough to repair all future returned batteries and existing inventories. Management decided to dispose of the obsolete inventories and made provision on the obsolete inventories to be disposed of in the future.

~~Net~~Interest Income ~~Including Non-Controlling Interest~~

~~Net~~Interest income was US$91,~~272~~184,000 and US$6315,~~949,~~000 for the ~~six~~nine months ended ~~September~~December 3031, 2011 and 2010, respectively. The increase of US$2869,~~323,~~000, or 33275.4387%, was mainly attributable to anthe increase in the ~~extraordinary~~average ~~gain~~deposit ofinterest ~~US$13,053,000,~~rate ~~offset~~as bywell ~~an operating loss of US$1,941,000 (~~as ~~compared~~an ~~with~~increase ~~operating~~in ~~income~~restricted ofcash ~~US$6,949,000~~pledged for ~~the~~notes ~~six~~granted by ~~months ended September 30, 2011) and the addition of an extraordinary loss of US$1,840,000~~banks.

~~Liquidity~~(Loss) Income before Interest and ~~Capital~~Income ~~Resources~~Tax Expenses

Loss before interest and income tax expenses were US$7,763,000 for the nine months ended December 31, 2011 as compared with an income of US$12,410,000 for the corresponding period in 2010. The ~~Company~~decrease ~~generally~~of ~~finances~~US$20,173,000 ~~its~~was ~~operations~~mainly ~~through~~attributable ~~operating~~to ~~activities~~an increase of general and ~~borrowings~~administrative ~~from~~expense ~~banks~~of US$3,969,000, loss on disposal of inventories of US$3,785,000 and provision on obsolete inventories of US$5,431,000.

-Interest ~~36 -~~Expense

~~During~~Interest ~~the~~expense ~~reporting~~for ~~periods,~~ the ~~Company~~three ~~entered~~months ~~into~~ended December a31, ~~number~~2011 ofand ~~short-term~~2010 ~~bank~~was ~~loans~~US$4,846,000 toand ~~satisfy~~US$2,231,000, ~~its~~respectively. ~~financing~~The ~~needs. As~~increase ofin ~~the~~interest ~~date~~expense of ~~this report~~US$2,615,000, ~~we have not experienced any difficulty in raising funds by bank loans~~or 117.21%, ~~and~~was wemainly ~~have~~attributable ~~not~~to ~~experienced~~the ~~any~~increase ~~liquidity problems~~ in ~~settling~~banking ~~our~~facilities ~~payables~~utilized inby the ~~normal~~Company ~~course~~as ofwell ~~business~~as ~~and~~an ~~repaying~~increase ~~our~~in ~~bank loans when they fall due~~interest rate.

~~The~~Income ~~following~~Taxes ~~table~~Benefits ~~sets forth the summary of our cash flows, in U.S. Dollars, for the periods indicated:~~(Expenses)

	Six Months Ended September 30,
	(in thousands)
	2011(US$)			2010(US$)
Net cash (used in) provided by operating activities		(5,465	)		12,124
Net cash used in investing activities		(13,000	)		(4,125	)
Net cash provided by (used in) financing activities		15,595			(5,508	)
Net (decrease) increase in cash and cash equivalents		(2,870	)		2,491
Cash and cash equivalents, beginning of period		7,630			6,019
Effect on exchange rate changes		188			102
Cash and cash equivalents at end of period		4,948			8,612

Income taxes benefits for the nine months ended December 31, 2011 was US$352,000 as compared with a tax expense of US$2,421,000 for the corresponding period in 2010. The decrease in income taxes expenses of US$2,773,000 was mainly attributable to the decrease in operating profit during the period and the recognition of a deferred tax benefit of estimate unused tax loss.

-Extraordinary ~~37 -~~Gain

~~Operating~~During ~~Activities~~the nine months ended December 31, 2011, we completed the relocation of Plant A at Jingyi Road. Pursuant to the Compensation Agreement on Relocation and Acquisition entered into by CCEC and the Administrative Committee of Changxing Economic Development Zone (ACC), ACC shall pay us compensation in the amount of RMB98,514,000 (US$15,354,000) for the loss on long-term land lease prepayment and buildings located at Jingyi Road. In May 2011, the Company wrote off the long-term land lease prepayment and buildings at Jingyi Road with a net book value of approximately RMB14,354,000 (US$2,237,000) and therefore, net compensation income of RMB$84,160,000 (US$13,117,000) was recognized for the period. The transaction of relocation was considered as an involuntary conversion of a non-monetary asset into a monetary asset. According to ASC605-40-25, to the extent the cost of a nonmonetary asset differs from the amount of monetary assets received, the result of the realization of a gain from the transaction is recognized. The relocation activity is abnormal and significantly different from the ordinary and typical activities of the Company and is not expected to recur in the foreseeable future. In accordance with ASC225-20, the Company classified the gain as an extraordinary item. Pursuant to the Implementation Regulations to the EIT law of the PRC, only the portion of compensation income exceeding the reinvestment amount related to the relocation was taxable. All compensation income received by the Company would be reinvested into the fixed assets and long-term land lease prepayment of Plant C at Jingsi Road and therefore, no income tax was applicable.

Net cash used in operating activities was US$5,465,000 for the six months ended September 30, 2011, as compared to net cash provided by operating activities of US$12,124,000 for the six months ended September 30, 2010.-34-

~~The~~Extraordinary decrease in cash inflow of US$17,589,000 was mainly attributable to the increase in a trade receivable of US$28,804,000 offsetting the decrease in gross income of US$7,284,000, inventories of US$5,564,000, prepayment of US$6,281,000, bills payable of US$20,497,000 and amounts due to related parties of US$3,573,000 as compared with the same period in 2010.Loss

~~Investing~~During ~~Activities~~the first quarter of 2011 and without advance notice to the Company, the PRC Central Government tightened its environmental protection policy which applies to all lead-acid battery manufacturers. Pursuant to the new policy, a 500 meter isolated area must be maintained between production facilities and residential areas. From the beginning of May, the Zhejiang Environmental Protection Bureau (ZEPB) conducted an environmental sanitation investigation at Plant B. The results showed that the sewage and exhaust complied with national standards in China, however, the Company is not maintaining the 500 meter isolated area between production facilities and residential areas. The ZEPB requires all production facilities at Plant B to have complied with and meet the adjusted environmental policy prior to July 15, 2011. We, however, were permitted by the government to continue to conduct our battery charging activities and packing activities during the period ended December 31, 2011. During the three months ended December 31, 2011 we were further advised by the local authority that our Plant B can continue to conduct our charging and packaging activities until October 31, 2012. As such, we did not suffer any penalty due to this tightened environmental protection policy.

~~Net~~As ~~cash~~of ~~used~~the indate ~~investing~~of ~~activities~~this report, ~~was~~the ~~US$13,000,000~~Government ~~and~~preliminarily ~~US$4,125,000~~agreed to re-designate the land in Changxing County to us for redevelopment. Prior to the new ~~six~~plant ~~months~~in ~~ended~~Changxing ~~September~~County 30being built, ~~2011~~our ~~and~~lead-acid ~~2010,~~battery ~~respectively~~production was relocated to Plant D.

~~The~~As ~~increase~~such, inthe ~~net~~impairment loss ~~cash outflow~~ of ~~US$8,875,000~~some ~~was~~fixed ~~mainly attributable to an increase in acquisition of property~~assets, including plant and ~~equipment,~~machinery ~~and~~together ~~long~~with ~~term~~a ~~land~~leasehold ~~lease~~improvement ~~prepayment~~ of approximately US$151,~~615~~848,000, ~~offsetting~~were recognized ~~the~~as ~~compensation~~an ~~received~~extraordinary ~~for~~loss. ~~the~~Management ~~disposal~~considers ofthat ~~plant,~~this ~~machinery~~Government ~~and~~behavior ~~leasehold~~is ofvery ~~US$5,065,000~~unusual and athus ~~decrease in~~ the ~~acquisition~~relevant impairment loss of ~~available-for-sale~~plant ~~financial~~and ~~assets~~machinery ofwas ~~US$1,802,000~~classified as an extraordinary item.

~~Financing~~Pursuant ~~Activities~~to the Implementation Regulations to the EIT law of the PRC, the impairment loss can only be recognized when the relevant assets were disposed. Since the actual amount of loss in the future cannot be assessed accurately, no tax benefit was recognized.

Net ~~cash~~(Loss) ~~provided~~Income byIncluding financing activities was US$15,595,000 for the six months ended September 30, 2011 compared to the net cash used of US$5,508,000 for same period in 2010, representing an increase of US$21,103,000. The increase mainly consisted of addition of proceeds from bills financing of US$41,363,000 and increase in proceeds from shortNon-~~term~~Controlling ~~bank loans of US$15,263,000 offsetting the increase in repayment of bills financing and short-term bank loans of US$26,401,000 and US$9,406,000, respectively.~~Interest

~~Capital~~Net ~~Commitment~~loss including non-controlling interest was US$988,000 for the nine months ended December 31, 2011 as compared with a net income including non-controlling interest of US$9,496,000 at the corresponding period in 2010. The decrease of US$10,484,000 was mainly attributable to an increase in general and administrative expense of US$3,969,000, a loss on the disposal of scrap inventory of US$3,785,000 and provision on obsolete inventory of US$5,431,000, and a decrease in an operating income of the US$11,556,000 offset by an increase in extraordinary gain of US$11,379,000.

AsLiquidity ~~of September 30, 2011~~ and ~~March~~Capital ~~31, 2011, the Company had outstanding capital expenditure commitments of approximately US$137,907,000 and US$150,448,000, respectively, indicating a decrease of US$12,541,000, or 8.34%.~~Resources

~~Off-Balance~~The ~~Sheet~~Company ~~Arrangements~~generally finances its operations through operating activities and borrowings from banks.

WeDuring dothe ~~not~~reporting ~~have~~periods, ~~any~~the ~~outstanding~~Company ~~derivative~~entered into ~~financial~~a ~~instruments,~~number ~~off~~of short-~~balance~~term ~~sheet~~bank ~~guarantees,~~loans ~~interest~~to ~~rate~~satisfy ~~swap~~its ~~transactions~~financing needs. As of ~~foreign~~the ~~currency~~date ~~forward~~of ~~contracts.~~this ~~Furthermore~~report, we dohave not ~~have~~ experienced any ~~retained~~difficulty ~~or contingent interest~~ in ~~assets~~raising ~~transferred~~funds toby anbank ~~unconsolidated entity that serves as credit~~loans, ~~liquidity~~and orwe ~~market~~have ~~risk support to such entity. We do~~ not ~~have~~experienced any ~~variable~~liquidity ~~interest~~problems in ansettling ~~unconsolidated~~our ~~entity~~payables ~~that~~in ~~provides~~the normal ~~financing,~~course ~~liquidity,~~of ~~market~~business ~~risk~~and orrepaying ~~credit~~our ~~support~~bank toloans uswhen orthey ~~that~~fall ~~engages in leasing, hedging or research and development services with us~~due.

~~ITEM~~The 3.following ~~QUANTITATIVE~~table ~~AND~~sets ~~QUALITATIVE~~forth ~~DISCLOSURES~~the ~~ABOUT~~summary ~~MARKET~~of our ~~RISK~~cash flows, in U.S. Dollars, for the periods indicated:

Interest Rates Risk

	Nine Months Ended December 31,
	(in thousands)
	2011(US$)		2010(US$)
Net cash (used in) provided by operating activities		(20,327)		6,952
Net cash used in investing activities		(53,058)		(10,405)
Net cash provided by financing activities		72,695		3,491
Net (decrease) increase in cash and cash equivalents		(690)		38
Cash and cash equivalents, beginning of period		7,630		6,019
Effect on exchange rate changes		230		180
Cash and cash equivalents at end of period		7,170		6,237

~~Our exposure to interest rate risk for changes in interest rates relates primarily to the interest~~-~~bearing bank loans and interest income generated by our bank deposits. We have not used any derivative financial instruments in our investment portfolio or for cash management purposes. Interest~~35-earning instruments carry a degree of interest rate risk. We have not been exposed nor do we anticipate being exposed to material risks due to changes in interest rates. Nevertheless, our future interest expense or interest income may expect to be decreased due to changes in interest rates in the PRC.

-Operating ~~38 -~~Activities

~~Foreign~~Net ~~Exchange~~cash ~~Rates~~used ~~Risk~~in operating activities was US$20,327,000 for the nine months ended December 31, 2011, as compared to net cash provided by operating activities of US$6,952,000 for the nine months ended December 31, 2010.

WeThe dodecrease ~~not hold any derivative instruments and do not engage~~ in cash ~~any~~inflow ~~hedging activities. Because most~~ of ~~our purchases and sales are made in RMB~~US$27,279,000 ~~any~~was ~~exchange~~mainly ~~rate~~attributable ~~change~~to ~~affecting~~ the ~~value~~decrease ofin ~~the~~notes ~~RMB~~and ~~relative~~trade topayables ~~the~~by ~~U.S.~~US$55,671,000 ~~Dollar~~and ~~could have~~ an increase ~~effect on our financial results as reported~~ in ~~U.S.~~inventories ~~Dollars.~~by IfUS$6,608,000, ~~the~~offsetting ~~RMB were to depreciate against~~ the ~~U.S.~~decrease ~~Dollar, amounts reported~~ in ~~U.S.~~trade ~~Dollars~~receivable ~~would~~by beUS$44,558,000 ~~correspondingly~~as ~~reduced.~~compared Ifwith the same ~~RMB~~period ~~were to appreciate against the U.S. Dollar, amounts reported~~ in U2010.~~S. Dollars would be correspondingly increased.~~

~~Contractual~~Investing ~~Obligations~~Activities

	Payments Due By Period
Contractual Obligations (US$)	Total		Less than 1 year		1-3 years		3-5 years		More than 5 years
Bank Indebtedness	(SEE TABLE BELOW)
Other Indebtedness		0		0		0		0		0
Capital Lease Obligations		0		0		0		0		0
Operating Lease Obligations	(SEE TABLE BELOW)
Purchase Obligations	(SEE TABLE BELOW)
Other Long-Term Liabilities Reflected on the Company’s Balance Sheet under US GAAP		0		0		0		0		0
Total:		0		0		0		0		0

Net cash used in investing activities was US$53,058,000 and US$10,405,000 for the period ended December 31, 2011 and 2010, respectively.

Bank indebtedness (US$)	September 30, 2011		March 31, 2011
Short-term bank borrowings	US$	82,030,000	US$	65,159,000
Notes payable (within (1) year)	US$	34,299,000	US$	48,640,000
Total	US$	116,329,000	US$	113,799,000

The increase of US$42,653,000 net cash outflow was mainly attributable to an increase in the acquisition of property, plant and equipment of US$29,150,000, an investment in restricted bank balances of US$14,893,000 and a deposit paid for the acquisition of land and buildings of US$6,348,000, offset by the compensation received for loss on plant and machinery and leasehold improvement of US$6,658,000 and a decrease in the acquisition of available-for-sale financial assets of US$1,826,000.

Purchase Obligations (US$)	September 30, 2011		March 31, 2011
Construction projects and purchase of machinery	US$	137,907,000	US$	150,448,000
Total	US$	137,907,000	US$	150,448,000

Financing Activities

Operating Lease Obligations (US$)	September 30, 2011		March 31, 2011
Within one (1) year	US$	451,000	US$	655,000
1-3 years	US$	646,000	US$	1,196,000
3-5 years	US$	-	US$	120,000
Over five (5) years	US$	-	US$	-
Total	US$	1,097,000	US$	1,971,000

Net cash provided by financing activities was US$72,695,000 and US$3,491,000 for the periods ended December 31, 2011 and 2010.

~~ITEM~~The 4.increase ~~CONTROLS~~of ~~AND~~US$69,204,000 was ~~PROCEDURES~~mainly attributable to the increase in proceeds from short-term bank loans of US$28,294,000 and bills financing of US$88,661,000, offset by an increase in the repayment of US$21,512,000 and bills financing of US$26,523,000.

~~Disclosure~~Capital ~~Controls and Procedures~~Commitment

~~Under~~As ~~the supervision and with the participation~~ of ~~our~~December ~~management~~31, ~~including our principal executive officer~~ 2011 and ~~principal~~March ~~financial~~31, ~~and accounting officer~~2011, ~~we conducted an evaluation of~~ the ~~effectiveness~~Company ofhad ~~the~~outstanding ~~design~~capital ~~and~~expenditure ~~operation~~commitments of ~~our~~approximately ~~disclosure~~US$128,619,000 ~~controls~~ and ~~procedures~~US$150, ~~as defined in Rule 13a-15(e) under the Exchange Act. Based on this evaluation~~448, ~~our management~~000, ~~including our principal executive officer and our principal financial and accounting officer~~ respectively, ~~concluded~~indicating ~~that~~a ~~our~~decrease ~~disclosure controls and procedures were effective as~~ of ~~the fiscal quarter covered by this report~~US$21, ~~to ensure that information required to be disclosed by us in the reports filed or submitted by us under the Exchange Act (i) is recorded~~829, ~~processed~~000, ~~summarized~~or and reported within the time period specified in SEC rules and forms and (ii) is accumulated and communicated to our management, including our principal executive officer and our principal financial and accounting officer, as appropriate to allow appropriate decisions on a timely basis regarding required disclosure14.51%.

Off-Balance 39Sheet -Arrangements

~~Changes~~We do not have any outstanding derivative financial instruments, off-balance sheet guarantees, interest rate swap transactions of foreign currency forward contracts. Furthermore, we do not have any retained or contingent interest in ~~Internal~~assets ~~Control~~transferred ~~over~~to ~~Financial~~an ~~Reporting~~unconsolidated entity that serves as credit, liquidity or market risk support to such entity. We do not have any variable interest in an unconsolidated entity that provides financing, liquidity, market risk or credit support to us or that engages in leasing, hedging or research and development services with us.

~~There~~ITEM ~~were~~3. noQUANTITATIVE ~~changes~~AND inQUALITATIVE ~~internal~~DISCLOSURES ~~control~~ABOUT ~~over~~MARKET financial reporting that occurred during the fiscal quarter covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.RISK

~~PART~~Interest IIRates Risk

~~OTHER~~Our ~~INFORMATION~~exposure to interest rate risk for changes in interest rates relates primarily to the interest-bearing bank loans and interest income generated by our bank deposits. We have not used any derivative financial instruments in our investment portfolio or for cash management purposes. Interest-earning instruments carry a degree of interest rate risk. We have not been exposed nor do we anticipate being exposed to material risks due to changes in interest rates. Nevertheless, our future interest expense or interest income may expect to be decreased due to changes in interest rates in the PRC.

~~ITEM 1. LEGAL PROCEEDINGS~~-36-

InForeign ~~the~~Exchange ~~normal~~Rates course of business, we are named as defendant in lawsuits in which claims are asserted against us. In our opinion, the liabilities, if any, which may ultimately result from such lawsuits, are not expected to have a material adverse effect on our financial position, results of operations or cash flows. As of September 30, 2011, there was no pending or outstanding material litigation with the Company.Risk

~~ITEM~~We 1Ado not hold any derivative instruments and do not engage in any hedging activities. ~~RISK~~Because ~~FACTORS~~most of our purchases and sales are made in RMB, any exchange rate change affecting the value of the RMB relative to the U.S. Dollar could have an effect on our financial results as reported in U.S. Dollars. If the RMB were to depreciate against the U.S. Dollar, amounts reported in U.S. Dollars would be correspondingly reduced. If the RMB were to appreciate against the U.S. Dollar, amounts reported in U.S. Dollars would be correspondingly increased.

~~Not~~Contractual ~~required for a “smaller reporting company”.~~Obligations

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

	Payments Due By Period
Contractual Obligations (US$)	Total		Less than 1 year		1-3 years		3-5 years		More than 5 years
Bank Indebtedness	(SEE TABLE BELOW)
Other Indebtedness		0		0		0		0		0
Capital Lease Obligations		0		0		0		0		0
Operating Lease Obligations	(SEE TABLE BELOW)
Purchase Obligations	(SEE TABLE BELOW)
Other Long-Term Liabilities Reflected on the Company’s Balance Sheet under US GAAP		0		0		0		0		0
Total:		0		0		0		0		0

None.

Bank indebtedness (US$)	December 31, 2011		March 31, 2011
Short-term bank borrowings	US$	139,512,000	US$	65,159,000
Notes payable (within (1) year)	US$	13,224,000	US$	48,640,000
Total	US$	152,736,000	US$	113,799,000

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

Purchase Obligations (US$)	December 31, 2011		March 31, 2011
Construction projects and purchase of machinery	US$	128,619,000	US$	150,448,000
Total	US$	128,619,000	US$	150,448,000

None.

Operating Lease Obligations (US$)	December 31, 2011		March 31, 2011
Within one (1) year	US$	450,000	US$	655,000
1-3 years	US$	539,000	US$	1,196,000
3-5 years	US$	-	US$	120,000
Over five (5) years	US$	-	US$	-
Total	US$	989,000	US$	1,971,000

ITEM 4. ~~(Removed~~CONTROLS ~~and~~AND ~~Reserved).~~PROCEDURES

~~ITEM~~Disclosure 5.Controls ~~OTHER~~and ~~INFORMATION~~Procedures

~~None~~Under the supervision and with the participation of our management, including our principal executive officer and principal financial and accounting officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rule 13a-15(e) under the Exchange Act. Based on this evaluation, our management, including our principal executive officer and our principal financial and accounting officer, concluded that our disclosure controls and procedures were effective as of the fiscal quarter covered by this report, to ensure that information required to be disclosed by us in the reports filed or submitted by us under the Exchange Act (i) is recorded, processed, summarized and reported within the time period specified in SEC rules and forms and (ii) is accumulated and communicated to our management, including our principal executive officer and our principal financial and accounting officer, as appropriate to allow appropriate decisions on a timely basis regarding required disclosure.

~~ITEM 6. EXHIBITS~~-37-

~~(a) Exhibits~~Changes in Internal Control over Financial Reporting

~~EXHIBIT~~There ~~NO.~~were ~~DESCRIPTION~~no ~~LOCATION~~changes in internal control over financial reporting that occurred during the fiscal quarter covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

2.1	Share Exchange Agreement, dated November 12, 2008, by and among World Trophy Outfitters, Inc., Fast More Limited, Cheer Gold Development Ltd. and Floster Investment Limited	Incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
3.1	Articles of Incorporation of World Trophy Outfitters, Inc. (n/k/a Chisen Electric Corporation)	Incorporated by reference to Exhibit 3(i).1 to the Registrant’s Registration Statement on Form SB-2 as filed with the SEC on September 23, 2005
3.2	Certificate of Amendment to Articles of Incorporation of Chisen Electric Corporation (name change)	Incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K as filed with the SEC on February 4, 2009
3.3	Amended and Restated Bylaws of Chisen Electric Corporation	Incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K as filed with the SEC on February 4, 2009

PART II

-OTHER ~~40 -~~INFORMATION

3.4		Certificate of Incorporation of Fast More Limited, dated December 17, 2007		Incorporated by reference to Exhibit 3.3 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
3.5		Memorandum and Articles of Association of Fast More Limited, dated as of December 17, 2007		Incorporated by reference to Exhibit 3.4 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008

ITEM 1. LEGAL PROCEEDINGS

3.6	Certificate of Incorporation of Changxing Chisen Electric Co., Ltd.	Incorporated by reference to Exhibit 3.5 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
3.7	Articles of Association of Changxing Chisen Electric Co., Ltd.	Incorporated by reference to Exhibit 3.6 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
3.8	Business Registration Certificate of Changxing Chisen Electric Co., Ltd. (English Translated Version and Mandarin Version)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.1	Agreement on Establishment of Changxing Chisen Physical Chemistry Power Research and Development Center, dated April 30, 2008	Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
10.2	Form of Labor Contract	Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
10.3	Lease Agreement, dated March 30, 2008, by and between Changxing Chisen Electric Co., Ltd. and Changxing Xiangyi Industrial Park Investment Co., Ltd.	Incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008

In the normal course of business, we are named as defendant in lawsuits in which claims are asserted against us. In our opinion, the liabilities, if any, which may ultimately result from such lawsuits, are not expected to have a material adverse effect on our financial position, results of operations or cash flows. As of December 31, 2011, there was no pending or outstanding material litigation with the Company.

10.4	Contract For Loan on Guarantee, by and among Zhejiang Changxing Agricultural Cooperative Bank, Changxing Chisen Electric Co., Ltd. and Zhejiang Chisen Glass Co., Ltd.	Incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
10.5	Renminbi Loan Contract, dated January 11, 2008, by and between Changxing Chisen Electric Co., Ltd. and China Construction Bank Corporation (Changxing Branch)	Incorporated by reference to Exhibit 10.5 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
10.6	Renminbi Loan Contract, dated April 11, 2008, by and between Changxing Chisen Electric Co., Ltd. and China Construction Bank Corporation (Changxing Branch)	Incorporated by reference to Exhibit 10.6 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
10.7	Renminbi Loan Contract, dated March 31, 2008, by and between Changxing Chisen Electric Co., Ltd. and Bank of China (Hong Kong) Limited Shanghan Branch	Incorporated by reference to Exhibit 10.7 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008

ITEM 1A. RISK FACTORS

-Not 41required -for a “smaller reporting company”.

10.8	Loan Contract (Short Term), dated August 15, 2008, by and between Changxing Chisen Electric Co., Ltd. and Bank of China Changxing Branch	Incorporated by reference to Exhibit 10.8 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
10.9	Acceptance Agreement, dated August 25, 2008, by and between Changxing Chisen Electric Co., Ltd. and Industrial Bank Co., Ltd. Hangzhou Branch	Incorporated by reference to Exhibit 10.9 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
10.10	Acceptance Agreement of Commercial Bill, dated September 18, 2008, by and between Changxing Chisen Electric Co., Ltd. and China Bank Co., Ltd. Changxing Branch	Incorporated by reference to Exhibit 10.10 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

10.11	Cooperation Agreement, dated April 20, 2008, by and between Changxing Chisen Electric Co., Ltd. and Xiamen University	Included by reference to Exhibit 10.11 to the Company’s Annual Report on Form 10-K as filed with the SEC on June 28, 2010
10.11	Acceptance Agreement of Commercial Bill, dated July 29, 2008, by and between Changxing Chisen Electric Co., Ltd. and China Construction Bank Changxing Branch Co., Ltd.	Incorporated by reference to Exhibit 10.11 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
10.12	Acceptance Agreement of Commercial Bill, dated September 9, 2008, by and between Changxing Chisen Electric Co., Ltd. and China Construction Bank Changxing Branch Co., Ltd.	Incorporated by reference to Exhibit 10.12 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
10.13	Components Purchase Contract, effective as of January 1, 2008, by and between Changxing Chisen Electric Co., Ltd. and Jiansu Xinri Electric Bicycle Co., Ltd.	Incorporated by reference to Exhibit 10.13 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008

None.

10.14	Supply Contract, dated April 22, 2008, by and between Changxing Chisen Electric Co., Ltd. And Jiangsu Yadea Science & Technology Development Co., Ltd.	Incorporated by reference to Exhibit 10.14 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
10.15	Sales Contract of Battery, dated November 10, 2007, by and between Changxing Chisen Electric Co., Ltd. and Hu Qinzhong, Yancheng Office	Incorporated by reference to Exhibit 10.15 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
10.16	Sales Contract of Battery, dated February 17, 2008, by and between Changxing Chisen Electric Co., Ltd. and Song Chunwei	Incorporated by reference to Exhibit 10.16 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
10.17	Compensation Agreement of Corporate Relocation Acquisition, dated August 20, 2010, by and between the Company’s chief operating subsidiary, Changxing Chisen Electric Co., Ltd., and the Administrative Committee of Changxing Economic Development Zone, Zhejiang	Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K as filed with the SEC on August 24, 2010.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

~~- 42 -~~None.

10.18	Investment Agreement, dated August 20, 2010, by and between the Company’s chief operating subsidiary, Changxing Chisen Electric Co., Ltd., and the Administrative Committee of Changxing Economic Development Zone, Zhejiang	Incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K as filed with the SEC on August 24, 2010.
10.19	Supplemental Agreement, dated August 20, 2010, by and between the Company’s chief operating subsidiary, Changxing Chisen Electric Co., Ltd., and the Administrative Committee of Changxing Economic Development Zone, Zhejiang	Incorporated by reference to Exhibit 10.6 to the Company’s Current Report on Form 8-K as filed with the SEC on August 24, 2010.
10.20	Xuyi Economic Development Zone Project Investment Contract, dated September 6, 2010, by and between Chisen Electric Jiangsu Co., Ltd. and Jiangsu Xuyi Economic Development Zone Administrative Committee	Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K as filed with the SEC on September 13, 2010.
10.21	Xuyi Economic Development Zone Project Investment Contract Supplemental Agreement, dated September 6 2010, by and between Chisen Electric Jiangsu Co., Ltd. and Jiangsu Xuyi Economic Development Zone Administrative Committee	Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K as filed with the SEC on September 13, 2010.

ITEM 4. MINING SAFETY DISCLOSURE

10.22		Electrode Purchase Contract, dated August 2, 2010, by and between Changxing Chisen Electric Co., Ltd. and Jiangsu XiangFa Electric Co., Ltd. (English Translated and Mandarin Versions)		Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.25		Sales Contract, dated August 31, 2009, by and between Changxing Chisen Electric Co., Ltd. and Anqing Burui Power Supply Co., Ltd. (English Translated and Mandarin Versions)		Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

Not applicable.

10.26		Contract, dated November 24, 2009, by and between Changxing Chisen Electric Co., Ltd. and Anyang City Yubei Gold and Lead Co., Ltd. (English Translated and Mandarin Versions)		Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.27		Parts Acquisition Contract, dated January 1, 2010, by and between Changxing Chisen Electric Co., Ltd. and Jiangsu Xinri E-Vehicle Co., Ltd. (English Translated and Mandarin Versions)		Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

ITEM 5. OTHER INFORMATION

~~- 43 -~~None.

10.29	Contract, dated August 1, 2010, by and between Changxing Chisen Electric Co., Ltd. and Tianjin Aima Technology Company Limited (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.30	Supplementary Agreement of Changxing Chisen Electric Co., Ltd. Relocation Project (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.31	Contract of Guaranty of Maximum Amount, dated on our about February 10, 2010, by and between Agricultural Bank of China (Changxing County Branch) and Zhejiang Chisen Glass Co., Ltd. (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.32	Guarantee Contact, dated on or about April 2, 2010, by and between China Construction Bank Corporation (Changxing Branch) and Zhejiang Chisen Glass Co., Ltd. (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.33	Contract Guarantee of Maximum Amount, dated on or about April 14, 2009, by and between Shanghai Pudong Development Bank (Huzhou Branch) and Zhejiang Changxing Chisen Xinguangyuan Co., Ltd. (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.34	Guarantee Contract, dated on or about January 12, 2010, by and between Changxing Economic Development Zone and Zhejiang Changxing Ruilang Electric Co., Ltd. (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.35	Contract of Guarantee with a Maximum Amount, dated on or about July 1, 2008, by and between Bank of China (Changxing Branch) and Mr. Xu Kecheng (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

-38-

10.36		Contract of Guarantee, undated, by and between CITIC Trust Co., Ltd. and Zhejiang Changxing Xinguangyuan Co., Ltd. (RMB40,000,000) (English Translated and Mandarin Versions)		Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.37		Contact of Guarantee, undated, by and between CITIC Trust Co., Ltd. and Zhejiang Changxing Chisen Xinguangyuan Co., Ltd. (RMB60,000,000) (English Translated and Mandarin Versions)		Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

ITEM 6. EXHIBITS

~~- 44 -~~(a) Exhibits

10.38	Guarantee Contract (64720012302010005), dated January 13, 2010, by and among China Construction Bank Corporation, on the one hand, and Mr. Xu Kecheng and Ms. Zho Fangqin, on the other hand (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.39	Guarantee Contract (64720012302010004), dated January 13, 2010, by and among China Construction Bank Corporation, on the one hand, and Mr. Xu Kecheng and Ms. Zho Fangqin, on the other hand (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.40	Contract of Guarantee of Maximum Amount (33905201000030826), undated, by and between Agricultural Bank of China Changxing County Sub-branch, on the one hand, and Zhejiang Chisen Glass Co., Ltd., on the other hand (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.41	Contract of Guarantee with a Maximum Amount (BOC 130), dated October 25, 2010, by and between Xu Kecheng and Zho Fangqin, on the one hand, and Bank of China Ltd., on the other hand (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.42	Contract of Guarantee (3350012010AM00077300), dated November 16, 2010, by and between Zhejiang Changxing Chisen Xinguangyuan Co., Ltd. and Bank of Communication (Huzhou Branch) (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.43	Contract of Guarantee (3350012010AM00077301), dated November 16, 2010, by and between Xu Kecheng and Zho Fangqin, on the one hand, and Bank of Communication (Huzhou Branch) on the other hand (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

EXHIBIT NO.		DESCRIPTION		LOCATION

10.44 Guarantee Contract (6435009992012194), dated September 27, 2010, by and between Xu Kecheng and Zho Fangqin, on the one hand, and China Construction Bank Corporation (Changxing Sub-Branch) on the other hand (English Translated and Mandarin Versions) Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

2.1	Share Exchange Agreement, dated November 12, 2008, by and among World Trophy Outfitters, Inc., Fast More Limited, Cheer Gold Development Ltd. and Floster Investment Limited	Incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008

3.1	Articles of Incorporation of World Trophy Outfitters, Inc. (n/k/a Chisen Electric Corporation)	Incorporated by reference to Exhibit 3(i).1 to the Registrant’s Registration Statement on Form SB-2 as filed with the SEC on September 23, 2005

3.2	Certificate of Amendment to Articles of Incorporation of Chisen Electric Corporation (name change)	Incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K as filed with the SEC on February 4, 2009

3.3	Amended and Restated Bylaws of Chisen Electric Corporation	Incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K as filed with the SEC on February 4, 2009

- 45 -

3.4	Certificate of Incorporation of Fast More Limited, dated December 17, 2007	Incorporated by reference to Exhibit 3.3 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008

3.5	Memorandum and Articles of Association of Fast More Limited, dated as of December 17, 2007	Incorporated by reference to Exhibit 3.4 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008

10.45 Guarantee Contract (64720012302010012), dated April 19, 2010, by and between Xu Kecheng and Zho Fangqin, on the one hand, and China Construction Bank Corporation (Changxing Sub-Branch) on the other hand (English Translated and Mandarin Versions) Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

3.6	Certificate of Incorporation of Changxing Chisen Electric Co., Ltd.	Incorporated by reference to Exhibit 3.5 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008

3.7	Articles of Association of Changxing Chisen Electric Co., Ltd.	Incorporated by reference to Exhibit 3.6 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008

3.8	Business Registration Certificate of Changxing Chisen Electric Co., Ltd. (English Translated Version and Mandarin Version)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

3.9	Certificate of Change to Articles of Incorporation of Chisen Electric Corporation (Forward Split)	Incorporated by reference to the Company’s Current Report on Form 8-K as filed with the SEC on November 28, 2011

10.1	Agreement on Establishment of Changxing Chisen Physical Chemistry Power Research and Development Center, dated April 30, 2008	Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008

10.2	Form of Labor Contract	Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008

10.3	Lease Agreement, dated March 30, 2008, by and between Changxing Chisen Electric Co., Ltd. and Changxing Xiangyi Industrial Park Investment Co., Ltd.	Incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008

10.46	Guarantee Contract (647200123020100201), dated October 9, 2010, by and between Xu Kecheng and Zho Fangqin, on the one hand, and China Construction Bank Corporation (Changxing Sub-Branch) on the other hand (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.4	Contract For Loan on Guarantee, by and among Zhejiang Changxing Agricultural Cooperative Bank, Changxing Chisen Electric Co., Ltd. and Zhejiang Chisen Glass Co., Ltd.	Incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
10.47	Guarantee Contract (64720092302010036), dated October 18, 2010, by and between Xu Kecheng and Zho Fangqin, on the one hand, and China Construction Bank Corporation (Changxing Sub-Branch) on the other hand (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.5	Renminbi Loan Contract, dated January 11, 2008, by and between Changxing Chisen Electric Co., Ltd. and China Construction Bank Corporation (Changxing Branch)	Incorporated by reference to Exhibit 10.5 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
10.48	Guarantee Contract (647200923020100381), dated November 10, 2010, by and between Xu Kecheng and Zho Fangqin, on the one hand, and China Construction Bank Corporation (Changxing Sub-Branch) on the other hand (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.49	Contract of Guarantee (P2009M17SZJZH0001JF14-0081-1) under Trust Loan Contract No. P2009M17SZJZH0001JF14-0081-1 , undated, by and between Xu Kecheng and CITIC Trust Co., Ltd. (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.50	Contract of Guarantee (P2009M17SZJZH0001JF14-0081-2) under Trust Loan Contract No. P2009M17SZJZH0001JF14-0081-2), undated, by and between Xu Kecheng and CITIC Trust Co., Ltd. (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

- 46 39-

10.51 Contract of Guarantee (003), by and between Zhejiang Changxing Chisen Xinguangyuan Co., Ltd. and the Bank of China (English Translated and Mandarin Versions) Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011


10.6	Renminbi Loan Contract, dated April 11, 2008, by and between Changxing Chisen Electric Co., Ltd. and China Construction Bank Corporation (Changxing Branch)	Incorporated by reference to Exhibit 10.6 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008

10.7	Renminbi Loan Contract, dated March 31, 2008, by and between Changxing Chisen Electric Co., Ltd. and Bank of China (Hong Kong) Limited Shanghan Branch	Incorporated by reference to Exhibit 10.7 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008

10.52	Contract by and between Changxing Chisen Electric Co., Ltd. and Zhejiang Chisen Glass Co., Ltd. dated March 8, 2010 (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.8	Loan Contract (Short Term), dated August 15, 2008, by and between Changxing Chisen Electric Co., Ltd. and Bank of China Changxing Branch	Incorporated by reference to Exhibit 10.8 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
10.53	Contract by and between Changxing Chisen Electric Co., Ltd. and Zhejiang Chisen Glass Co., Ltd., dated December 20, 2010 (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.9	Acceptance Agreement, dated August 25, 2008, by and between Changxing Chisen Electric Co., Ltd. and Industrial Bank Co., Ltd. Hangzhou Branch	Incorporated by reference to Exhibit 10.9 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
10.54	Contract by and between Changxing Chisen Electric Co., Ltd. and Zhejiang Changxing Ruilang Electronic Company Limited dated October 18, 2010 (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.10	Acceptance Agreement of Commercial Bill, dated September 18, 2008, by and between Changxing Chisen Electric Co., Ltd. and China Bank Co., Ltd. Changxing Branch	Incorporated by reference to Exhibit 10.10 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
10.55	Summary of Oral Loan Agreement with Ai Ge Organism Products Company Limited	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.56	Electrode Purchase Contract, dated August 2, 2010, by and between Changxing Chisen Electric Co., Ltd. and Jiangsu XiangFa Electric Co., Ltd. (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.11	Cooperation Agreement, dated April 20, 2008, by and between Changxing Chisen Electric Co., Ltd. and Xiamen University	Included by reference to Exhibit 10.11 to the Company’s Annual Report on Form 10-K as filed with the SEC on June 28, 2010
10.57	Electrode Plate Supply Contract, by and between Changxing Chisen Electric Co., Ltd. and Anqing Borui Power Supply Co., Ltd., dated August 2, 2010 (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.11	Acceptance Agreement of Commercial Bill, dated July 29, 2008, by and between Changxing Chisen Electric Co., Ltd. and China Construction Bank Changxing Branch Co., Ltd.	Incorporated by reference to Exhibit 10.11 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
10.58	Guarantee Contract (6472009992011036), dated March 31, 2011, by and between Xu Kecheng, on the one hand, and China Construction Bank Corporation (Changxing Sub-Branch) on the other hand (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.12	Acceptance Agreement of Commercial Bill, dated September 9, 2008, by and between Changxing Chisen Electric Co., Ltd. and China Construction Bank Changxing Branch Co., Ltd.	Incorporated by reference to Exhibit 10.12 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
10.59	Shanghai Pudong Development Bank Contract of Guarantee of Maximum Amount, dated March 31, 2011, by and between Shanghai Pudong Development Bank Huzhou Sub-branch and Zhejiang Chisen Glass Co., Ltd. (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
10.13	Components Purchase Contract, effective as of January 1, 2008, by and between Changxing Chisen Electric Co., Ltd. and Jiansu Xinri Electric Bicycle Co., Ltd.	Incorporated by reference to Exhibit 10.13 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008

- 47 -

10.14	Supply Contract, dated April 22, 2008, by and between Changxing Chisen Electric Co., Ltd. And Jiangsu Yadea Science & Technology Development Co., Ltd.	Incorporated by reference to Exhibit 10.14 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008

10.15	Sales Contract of Battery, dated November 10, 2007, by and between Changxing Chisen Electric Co., Ltd. and Hu Qinzhong, Yancheng Office	Incorporated by reference to Exhibit 10.15 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008

~~10.60 Shanghai Pudong Development Bank Contract of Guarantee of Maximum Amount, dated March 31, 2011, by and between Shanghai Pudong Development Bank Huzhou Sub~~-~~branch and Zhejiang Changxing Chisen Xingguangyuan Co., Ltd. (English Translated and Mandarin Versions) Incorporated by reference to the Company’s Annual Report on Form 10~~40-~~K as filed with the SEC on June 14, 2011~~

14.1	Code of Business Conduct and Ethics	Incorporated by reference to Exhibit 14.1 to the Company’s Current Report on Form 8-K as filed with the SEC on February 4, 2009
10.16	Sales Contract of Battery, dated February 17, 2008, by and between Changxing Chisen Electric Co., Ltd. and Song Chunwei	Incorporated by reference to Exhibit 10.16 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
16.1	Letter to SEC from Pritchett, Siler & Hardy, P.C.	Incorporated by reference to Exhibit 16.1 to the Company’s Current Report on Form 8-K as filed with the SEC on January 21, 2009
10.17	Compensation Agreement of Corporate Relocation Acquisition, dated August 20, 2010, by and between the Company’s chief operating subsidiary, Changxing Chisen Electric Co., Ltd., and the Administrative Committee of Changxing Economic Development Zone, Zhejiang	Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K as filed with the SEC on August 24, 2010.
17	Resignation of Mathew Evans, dated November 12, 2008	Incorporated by reference to Exhibit 17 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008
21	List of Subsidiaries	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
31.1	Certifications of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	Provided herewith
31.2	Certifications of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	Provided herewith
32.1	Certification Pursuant To 18 U.S.C. Section 1350, As Adopted Pursuant To Section 906 of the Sarbanes-Oxley Act Of 2002	Provided herewith
32.2	Certification Pursuant To 18 U.S.C. Section 1350, As Adopted Pursuant To Section 906 of the Sarbanes-Oxley Act Of 2002	Provided herewith
99.1	Audit Committee Charter, dated January 15, 2009	Incorporated by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K as filed with the SEC on February 4, 2009
99.2	Compensation Committee Charter, dated January 15, 2009	Incorporated by reference to Exhibit 99.2 to the Company’s Current Report on Form 8-K as filed with the SEC on February 4, 2009

- 48 -

10.18	Investment Agreement, dated August 20, 2010, by and between the Company’s chief operating subsidiary, Changxing Chisen Electric Co., Ltd., and the Administrative Committee of Changxing Economic Development Zone, Zhejiang	Incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K as filed with the SEC on August 24, 2010.

10.19	Supplemental Agreement, dated August 20, 2010, by and between the Company’s chief operating subsidiary, Changxing Chisen Electric Co., Ltd., and the Administrative Committee of Changxing Economic Development Zone, Zhejiang	Incorporated by reference to Exhibit 10.6 to the Company’s Current Report on Form 8-K as filed with the SEC on August 24, 2010.

10.20	Xuyi Economic Development Zone Project Investment Contract, dated September 6, 2010, by and between Chisen Electric Jiangsu Co., Ltd. and Jiangsu Xuyi Economic Development Zone Administrative Committee	Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K as filed with the SEC on September 13, 2010.

10.21	Xuyi Economic Development Zone Project Investment Contract Supplemental Agreement, dated September 6 2010, by and between Chisen Electric Jiangsu Co., Ltd. and Jiangsu Xuyi Economic Development Zone Administrative Committee	Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K as filed with the SEC on September 13, 2010.

99.3 Corporate Governance and Nominating Committee Charter, dated January 15, 2009 Incorporated by reference to Exhibit 99.3 to the Company’s Current Report on Form 8-K as filed with the SEC on February 4, 2009

10.22	Electrode Purchase Contract, dated August 2, 2010, by and between Changxing Chisen Electric Co., Ltd. and Jiangsu XiangFa Electric Co., Ltd. (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.25	Sales Contract, dated August 31, 2009, by and between Changxing Chisen Electric Co., Ltd. and Anqing Burui Power Supply Co., Ltd. (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

99.4	China Battery Industry Association Certificate of Ranking (English Translated Version)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
99.5	China News Article entitled “Electric Bicycles are Involved in Government’s Subsidy Program” (English and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
99.6	Subsidize Policy on New Energy Vehicle (English and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.26

Contract, dated November 24, 2009, by and between Changxing Chisen Electric Co., Ltd. and Anyang City Yubei Gold and Lead Co., Ltd. (English Translated and Mandarin Versions)

Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

- 49 41-

~~SIGNATURES~~10.27 Parts Acquisition Contract, dated January 1, 2010, by and between Changxing Chisen Electric Co., Ltd. and Jiangsu Xinri E-Vehicle Co., Ltd. (English Translated and Mandarin Versions) Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Quarterly Report on Form 10-Q to be signed on its behalf by the undersigned, thereunto duly authorized.

10.29	Contract, dated August 1, 2010, by and between Changxing Chisen Electric Co., Ltd. and Tianjin Aima Technology Company Limited (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.30	Supplementary Agreement of Changxing Chisen Electric Co., Ltd. Relocation Project (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.31	Contract of Guaranty of Maximum Amount, dated on our about February 10, 2010, by and between Agricultural Bank of China (Changxing County Branch) and Zhejiang Chisen Glass Co., Ltd. (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.32	Guarantee Contact, dated on or about April 2, 2010, by and between China Construction Bank Corporation (Changxing Branch) and Zhejiang Chisen Glass Co., Ltd. (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.33	Contract Guarantee of Maximum Amount, dated on or about April 14, 2009, by and between Shanghai Pudong Development Bank (Huzhou Branch) and Zhejiang Changxing Chisen Xinguangyuan Co., Ltd. (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.34	Guarantee Contract, dated on or about January 12, 2010, by and between Changxing Economic Development Zone and Zhejiang Changxing Ruilang Electric Co., Ltd. (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.35	Contract of Guarantee with a Maximum Amount, dated on or about July 1, 2008, by and between Bank of China (Changxing Branch) and Mr. Xu Kecheng (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

Date: November 9, 2011	By:	/s/ Xu Kecheng
10.36		Contract of Guarantee, undated, by and between CITIC Trust Co., Ltd. and Zhejiang Changxing Xinguangyuan Co., Ltd. (RMB40,000,000) (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
		Name: Xu Kecheng
10.37		Contact of Guarantee, undated, by and between CITIC Trust Co., Ltd. and Zhejiang Changxing Chisen Xinguangyuan Co., Ltd. (RMB60,000,000) (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011
		Its: President, Chief Executive Officer and Principal Executive Officer

Date: November 9, 2011	By:	/s/ Liu Chuanjie
		Name: Liu Chuanjie
		Its: Chief Financial Officer, Principal Financial and Accounting Officer

-42-

- 50 -

10.38	Guarantee Contract (64720012302010005), dated January 13, 2010, by and among China Construction Bank Corporation, on the one hand, and Mr. Xu Kecheng and Ms. Zho Fangqin, on the other hand (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.39	Guarantee Contract (64720012302010004), dated January 13, 2010, by and among China Construction Bank Corporation, on the one hand, and Mr. Xu Kecheng and Ms. Zho Fangqin, on the other hand (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.40	Contract of Guarantee of Maximum Amount (33905201000030826), undated, by and between Agricultural Bank of China Changxing County Sub-branch, on the one hand, and Zhejiang Chisen Glass Co., Ltd., on the other hand (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.41	Contract of Guarantee with a Maximum Amount (BOC 130), dated October 25, 2010, by and between Xu Kecheng and Zho Fangqin, on the one hand, and Bank of China Ltd., on the other hand (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.42	Contract of Guarantee (3350012010AM00077300), dated November 16, 2010, by and between Zhejiang Changxing Chisen Xinguangyuan Co., Ltd. and Bank of Communication (Huzhou Branch) (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.43	Contract of Guarantee (3350012010AM00077301), dated November 16, 2010, by and between Xu Kecheng and Zho Fangqin, on the one hand, and Bank of Communication (Huzhou Branch) on the other hand (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.44

Guarantee Contract (6435009992012194), dated September 27, 2010, by and between Xu Kecheng and Zho Fangqin, on the one hand, and China Construction Bank Corporation (Changxing Sub-Branch) on the other hand (English Translated and Mandarin Versions)

Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

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10.45

Guarantee Contract (64720012302010012), dated April 19, 2010, by and between Xu Kecheng and Zho Fangqin, on the one hand, and China Construction Bank Corporation (Changxing Sub-Branch) on the other hand (English Translated and Mandarin Versions)

Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.46	Guarantee Contract (647200123020100201), dated October 9, 2010, by and between Xu Kecheng and Zho Fangqin, on the one hand, and China Construction Bank Corporation (Changxing Sub-Branch) on the other hand (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.47	Guarantee Contract (64720092302010036), dated October 18, 2010, by and between Xu Kecheng and Zho Fangqin, on the one hand, and China Construction Bank Corporation (Changxing Sub-Branch) on the other hand (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.48	Guarantee Contract (647200923020100381), dated November 10, 2010, by and between Xu Kecheng and Zho Fangqin, on the one hand, and China Construction Bank Corporation (Changxing Sub-Branch) on the other hand (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.49	Contract of Guarantee (P2009M17SZJZH0001JF14-0081-1) under Trust Loan Contract No. P2009M17SZJZH0001JF14-0081-1 , undated, by and between Xu Kecheng and CITIC Trust Co., Ltd. (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.50	Contract of Guarantee (P2009M17SZJZH0001JF14-0081-2) under Trust Loan Contract No. P2009M17SZJZH0001JF14-0081-2), undated, by and between Xu Kecheng and CITIC Trust Co., Ltd. (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.51

Contract of Guarantee (003), by and between Zhejiang Changxing Chisen Xinguangyuan Co., Ltd. and the Bank of China (English Translated and Mandarin Versions)

Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.52	Contract by and between Changxing Chisen Electric Co., Ltd. and Zhejiang Chisen Glass Co., Ltd. dated March 8, 2010 (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.53	Contract by and between Changxing Chisen Electric Co., Ltd. and Zhejiang Chisen Glass Co., Ltd., dated December 20, 2010 (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

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10.54	Contract by and between Changxing Chisen Electric Co., Ltd. and Zhejiang Changxing Ruilang Electronic Company Limited dated October 18, 2010 (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.55	Summary of Oral Loan Agreement with Ai Ge Organism Products Company Limited	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.56	Electrode Purchase Contract, dated August 2, 2010, by and between Changxing Chisen Electric Co., Ltd. and Jiangsu XiangFa Electric Co., Ltd. (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.57	Electrode Plate Supply Contract, by and between Changxing Chisen Electric Co., Ltd. and Anqing Borui Power Supply Co., Ltd., dated August 2, 2010 (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.58	Guarantee Contract (6472009992011036), dated March 31, 2011, by and between Xu Kecheng, on the one hand, and China Construction Bank Corporation (Changxing Sub-Branch) on the other hand (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.59	Shanghai Pudong Development Bank Contract of Guarantee of Maximum Amount, dated March 31, 2011, by and between Shanghai Pudong Development Bank Huzhou Sub-branch and Zhejiang Chisen Glass Co., Ltd. (English Translated and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

10.60

Shanghai Pudong Development Bank Contract of Guarantee of Maximum Amount, dated March 31, 2011, by and between Shanghai Pudong Development Bank Huzhou Sub-branch and Zhejiang Changxing Chisen Xingguangyuan Co., Ltd. (English Translated and Mandarin Versions)

Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

14.1	Code of Business Conduct and Ethics	Incorporated by reference to Exhibit 14.1 to the Company’s Current Report on Form 8-K as filed with the SEC on February 4, 2009

16.1	Letter to SEC from Pritchett, Siler & Hardy, P.C.	Incorporated by reference to Exhibit 16.1 to the Company’s Current Report on Form 8-K as filed with the SEC on January 21, 2009

17	Resignation of Mathew Evans, dated November 12, 2008	Incorporated by reference to Exhibit 17 to the Company’s Current Report on Form 8-K as filed with the SEC on November 12, 2008

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21	List of Subsidiaries	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

31.1	Certifications of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	Provided herewith

31.2	Certifications of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	Provided herewith

32.1	Certification Pursuant To 18 U.S.C. Section 1350, As Adopted Pursuant To Section 906 of the Sarbanes-Oxley Act Of 2002	Provided herewith

32.2	Certification Pursuant To 18 U.S.C. Section 1350, As Adopted Pursuant To Section 906 of the Sarbanes-Oxley Act Of 2002	Provided herewith

99.1	Audit Committee Charter, dated January 15, 2009	Incorporated by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K as filed with the SEC on February 4, 2009

99.2	Compensation Committee Charter, dated January 15, 2009	Incorporated by reference to Exhibit 99.2 to the Company’s Current Report on Form 8-K as filed with the SEC on February 4, 2009

99.3

Corporate Governance and Nominating Committee Charter, dated January 15, 2009

Incorporated by reference to Exhibit 99.3 to the Company’s Current Report on Form 8-K as filed with the SEC on February 4, 2009

99.4	China Battery Industry Association Certificate of Ranking (English Translated Version)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

99.5	China News Article entitled “Electric Bicycles are Involved in Government’s Subsidy Program” (English and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

99.6	Subsidize Policy on New Energy Vehicle (English and Mandarin Versions)	Incorporated by reference to the Company’s Annual Report on Form 10-K as filed with the SEC on June 14, 2011

101.INS		XBRL Instance Document provided herewith.

101.CAL		XBRL Taxonomy Extension Calculation Linkbaset provided herewith.

101.DEF		XBRL Taxonomy Extension Definition Linkbaset provided herewith.

101.LAB		XBRL Taxonomy Extension Label Linkbaset provided herewith.

101.PRE		XBRL Taxonomy Extension Presentation Linkbaset provided herewith.

101.SCH		XBRL Taxonomy Extension Schema provided herewith.

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SIGNATURES

Date: February 14, 2012	By:	/s/ Xu Kecheng
		Name: Xu Kecheng
		Its: President, Chief Executive
		Officer and Principal Executive
		Officer

Date: February 14, 2012	By:	/s/ Liu Chuanjie
		Name: Liu Chuanjie
		Its: Chief Financial Officer, Principal Financial and Accounting Officer

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Filing Compare · Chisen Electric Corp