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Dragon Capital Group Corp. (DRGV) Subsidiary Chosen To Participate In National Science And Technology Research Project

|Includes: Dragon Capital Group Corp. (DRGV)

Dragon Capital Group, a leading holding company of emerging high-tech companies in China, today announced that its Shanghai Yazheng Information Technology Company ("Yazheng") subsidiary has been selected by the Chinese Central Government as one of the participants in a national science and technology research project focusing on the application of safe and large-scale programmable logic controllers (PLC's). With a total estimated R&D cost of approximately 20 million RMB ($3 million U.S.), this project is expected to begin in the fourth quarter of 2013 and last through 2015.

As China continues to accelerate the process of industrialization and automation, more and more companies are attempting to expand the scale of production. Productions facilities with multiple parameters, high risk and full automation features are being deployed across a wide array of industries including energy, transportation, manufacturing, aerospace, and chemical production. As a result, market demand for high-end safety control products is growing rapidly throughout China.

The current overall PLC market is estimated to be approximately 6-7 million RMB annually with the market for large-scale PLC's including large industrial plant control systems, safety interlock systems, safety instrumented systems, and high-end security control systems representing about 30% or 2 billion RMB. This market, which is expected to experience a better than 10% annual growth rate, has been mainly dominated by large foreign corporations. Projects like this are being sponsored by the government to foster domestic development of high-end control systems to enable China based companies to capture a much larger percentage of this fast growing market. The participants in this project will be able to utilize technologies developed through this government assistance to design practical applications for future commercialization.

Mr. Lawrence Wang, Chairman and CEO of Dragon Capital Group, stated, "We are very pleased to have been selected by the Central Government for this project as a result of our automation work in the utility industry. With the government essentially subsidizing the R&D efforts of the participants, we have the unique opportunity to enter large scale markets in the future. This will also help us add further functionality to our current monitoring systems as we continue to deploy and gain market share. We will continue to support Yazheng in their efforts to build this important business segment for the future growth of Dragon Capital."

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