Chimin Sang's  Instablog

Chimin Sang
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Chimin, aka Stanley, collected a Ph.D in Engineering from SUNY Buffalo and an MBA from Chicago Booth Business School. My full time job is reading, supported by my managing money for family and friends. I don't typically talk about my long positions but I do talk about the stocks that I either... More
  • Red Flags At China MediaExpress: Can We Trust CTR Research Report on CCME? 15 comments
    Feb 11, 2011 4:15 AM | about stocks: CCME

    In my previous articles (here, here and here), I present hard evidences and materials regarding the following points about China MediaExpress:

    1. China MediaExpress does not have "exclusive license" with the Ministry of Transport as it claimed.
    2. China MediaExpress falsely claimed two national awards for its on-bus TV patent. 
    3. China MediaExpress' SAIC numbers do not match what it provided to SEC significantly.
    4. The only advertising brokers China MediaExpress made known to the public, Shanghai Apollo Culture and Art Company, reported revenues and book value 1/1000th of the revenue it supposedly had with China MediaExpress, RMB 50m.

    In this article, I discuss its questionable use of CTR, a research firm in China, to exaggerate its business size and market size.

    CTR Report on the Company Website Missed 3 Pages

    In 2008, China MediaExpress engaged CTR Media Intelligence, an independent third party, to study CCME's effectiveness as well as its market size. The report can be found here. In particular the report on its market size can be found here on CCME's official website. 

    Few knows that this report is not the original report that CTR provided to China MediaExpress, which was provided to the early investors and can be found here

    The original document has 57 pages and the Company provided copy has 54 pages. The missing three pages, page 5, page 13 and page 54, are presented below.

    (Click to Enlarge)

    It is unknown why the Company decided to remove these three pages, but it looks like that they did not want to provide the bus operator breakdown by region and they do not want to provide the direct competitor information, which does not support their claim for "exclusive license".

    CTR Report Reported Bus Count Not Matched To CCME's Marketing Kit

    In the official CTR document provided by CCME website, we can find page 8 describes the bus count breakdown for different areas and the screenshot is provided below.

    A 2009 marketing kit provided by CCME on, an advertising exchange platform, can be found here. A 2010 marketing kit can be found directly on, and the address is here (page link and file link). 

    They presented somewhat different stories. Screenshots for their bus counts are attached below -- the first two are from 2009 marketing kit, and the last one is from 2010 market kit. For 2010, only several big cities are picked for sanity check, but that applies to the rest. 

    (Click to Enlarge)

    We can find that the CTR report claims a much higher bus count than the marketing kits, especially for the first tier cities. Below is a summary table.

    (Click to Enlarge)

    Take Shanghai for example, CTR reported 2,127 buses, but the 2009 market kit quoted 291 and 2010 market kit quoted 203. This agrees with what Muddy Waters research found -- that Shanghai Bashi did not recognize CCME as a partner. 

    Is CTR Research a Reliable Source?

    First Financial Daily in China interviewed CTR and found something interesting. The original news has been quoted in numerous sources, and here is a link to Hexun, a popular Chinese financial site. Interested readers can use Google Translate to find out the content. 

    Two issues jumped up as eye catching.
    1. CTR Fuzhou, which is located in the same town where China MediaExpress is, will randomly sample the hard drives provided by the Company to generate the research report in March. The researcher claimed that it was impossible for her to investigate on-site nationwide, and can only rely on data provided by CCME.
    2. CTR has a loose structure. Its Beijing office, the headquarter, did not recognize CCME as a customer; its Shanghai office has not had business with CCME since 2008; its Fuzhou office is the one who is currently involved. 

    So far my research points to the suggestion that the CTR report seems inaccurate and its investigation method is flawed. 

    Again, investors be cautious!


    Disclosure: I am short OTCPK:CCME.
    Stocks: CCME
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Comments (15)
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  • nomad mike
    , contributor
    Comments (11) | Send Message
    When are you going to come clean about using forged documents in your previous articles?


    16 Feb 2011, 09:17 AM Reply Like
  • saltydawg
    , contributor
    Comments (34) | Send Message
    Just a blog again? Still haven't stated where you got that erronuous or fradulanet SAIC filing from last time. Till then, almost all you purport is tarnished, slanted and of little benefit.
    Your reputation precedes you comes to mind.
    Keep trying though, I appluade your tenacity in the wake of all you have shoveled upon yourself.
    16 Feb 2011, 09:19 AM Reply Like
  • T-R
    , contributor
    Comments (65) | Send Message
    You will never be satisfied no matter what.
    Why don't you just keep your short position and stop posting this nonsense. (Interesting how SA didn't want to publish this BS).
    If you believe your "theory" so much then just relax and keep your short.
    16 Feb 2011, 09:21 AM Reply Like
  • Marty Chilberg
    , contributor
    Comments (549) | Send Message
    Shocking revelations. The company made a conscious choice to hide some marketing data from potential competitors. I've only found that to be true in 100% of the companies in which I've invested. The others I decided to pass on as they didn't appear to understand how to run their business.


    Equally shocking that a company would provide certain data to a marketing research firm who then used it in their report. Next thing you'll publish is that analysts actually use company guidance and published information when they issue reports.


    Please let us know how many company marketing research reports you've been associated with in your many years of business experience so we can understand where your perspective originates.
    16 Feb 2011, 09:30 AM Reply Like
  • Don Hensler
    , contributor
    Comments (27) | Send Message
    The author distorts the use of the word "exclusive". CCME is the only company to have a tongzhi from the government - NOT the only company in the market. The company has always been clear in this regard, and has issued many press releases as it purchases operating rights from smaller companies in the market. Why does this author regularly distort the truth re CCME?
    16 Feb 2011, 09:36 AM Reply Like
  • saltydawg
    , contributor
    Comments (34) | Send Message
    He distorts the truth as he has disclosed his short position and is vehment in trying to distort facts to further his own position.
    He also can't even get the date of his own blog right! So much for an authoratative eye or Due Diligence.
    16 Feb 2011, 09:41 AM Reply Like
  • Drexion
    , contributor
    Comments (71) | Send Message
    Chimin, your whole point about Shanghai and CCME is simply incorrect. I know someone, very reputable in fact, who has personally visited a CCME long-distance bus operator in Shanghai this PAST SATURDAY and verified 1900 buses from there with CCME.


    It just goes to show how bad the information you are with working to make your thesis is.


    If anyone has questions about this, feel free to PM me about it on InvestorsHub (Username Drexion2004 there). I'll be glad to tell the name of the person who did this verification privately there.


    16 Feb 2011, 09:49 AM Reply Like
  • Ben grossbaum
    , contributor
    Comments (5) | Send Message
    Chimin, you sound tired... you should take a break go breath some fresh air... This instablog is BS (wonder why it's not an article... ah yes, seeking alpha doesn't trust you anymore after the lies and fraudulent material contained in your previous ones)...


    company hiding stuff from competition??? waouh!!! you should alert the Wall street journal!!!


    And the BS about the tongzhi... you're trying to fool weak hands and amateurs... you really have no pride...


    My opinion? case dismissed... Lol
    16 Feb 2011, 09:54 AM Reply Like
  • BlueSkiesLP
    , contributor
    Comments (11) | Send Message
    In a funny way, this guy is making the case for longs better and better every time he writes something.


    Keep up the good work. Can't wait for your next piece on how the 100% growth rate for CCME and its low PE is really bad for CCME because it will surely attract many new investors, and new investors are notoriously fickle, therefore you should be careful before investing in CCME....right?
    16 Feb 2011, 10:16 AM Reply Like
  • gunnar
    , contributor
    Comments (63) | Send Message
    Why is your instablog dated Feb. 11 when it was just posted today, Feb. 16?
    16 Feb 2011, 12:20 PM Reply Like
  • gunnar
    , contributor
    Comments (63) | Send Message
    So your instablog is dated 2/11, but it was really published on 2/16... funny how something you see on the Internet isn't always the complete story, eh Chimin?
    16 Feb 2011, 12:38 PM Reply Like
  • forzagrifo
    , contributor
    Comments (9) | Send Message
    Chimin's document is seriously flawed


    Link to the document:


    Here's what I found:


    - A CCME PR in May 2010 states they added 816 buses in Inner Mongolia province. In Chimin's document, Inner Mongolia isn't even shown in the bus count (see Chart 1 to 11 near the end of the document).


    - A CCME PR in Jul 2010 states they added 449 buses in Hangzhou, Zhejiang province. In Chimin's document, Zhejiang isn't even shown in the bus count (see Chart 1 to 11 near the end of the document).


    - A CCME PR in Aug 2010 states they added 128 buses in Jiangxi province. In Chimin's document, Jiangxi isn't even shown in the bus count (see Chart 1 to 11 near the end of the document).


    - Three CCME PR's in Sep 2010, Nov 2010, and Jan 2011 state they added 986, 635, and 623 buses respectively in Henan province. In Chimin's document, Henan province isn't even shown in the bus count (see Chart 1 to 11 near the end of the document).


    - A CCME PR in Nov 2010 states they added 1432 buses in Hunan province. In Chimin's document, Hunan isn't even shown in the bus count (see Chart 1 to 11 near the end of the document).


    At the bottom of each chart (Chart 1 to 11 near the end of the document), there's a note (note #2) saying that "the number of buses shown above is as of Dec 2010".


    If the bus data is up-to-date as of Dec 2010, why are the above-mentioned provinces not shown? Are they left out purposely?


    Hence, the entire document simply cannot be seriously relied upon. It is easy to deduce that the Shanghai bus count of 203 is incorrect, and all of Chimin's allegations are flawed.
    16 Feb 2011, 12:55 PM Reply Like
  • ccme_santa
    , contributor
    Comments (12) | Send Message
    Is it just me or on slide 35 of the link you provided:


    The Shanghai data row seems very misaligned. I've run a straight line tool over the text and the numbers just seem off.


    The last three values (98.6%, 40.2, 18.7) are aligned one way, but the (203, 1.75, 5.1, 7.7) values are aligned another way. The (3) value in the 3rd column seems to be the most off from the rest of the row.
    16 Feb 2011, 02:55 PM Reply Like
  • gokou3
    , contributor
    Comments (104) | Send Message
    Chimin, I'd still like to hear a rebuttal from you regarding your allegedly forged SAT tax document.
    16 Feb 2011, 10:20 PM Reply Like
  • Drexion
    , contributor
    Comments (71) | Send Message
    As per an iHub post, it looks like Chimin's powerpoint was created in November 2008. Come on guy, use something a little newer would you? :
    "Advertiser's Kit Sleuthing


    Apparently, you can actually open the slide show document in powerpoint... all you need to do is change the .pps file extension to .ppt


    Once doing so, you can look at the properties of the file..


    File > Properties > Statistics tab


    ...the document was originally created Sunday, November 02, 2008 9:05:56 PM (according to my computer anyway)


    ...also of note: while some text is editable, the tables are all simply images.. therefore, anyone updating this presentation from an earlier version would be unable to edit any of the tables.


    Just thought you guys might want to know... "


    16 Feb 2011, 11:20 PM Reply Like
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