UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


WASHINGTON,
D.C. 20549


_______________




FORM
10-Q


_______________




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




For
the quarterly period ended June 30, 2008






o
            TRANSITION
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934





For the transition period from
______to______.




CHINA
GROWTH DEVELOPMENT, INC.


(Exact
name of registrant as specified in Charter)




DELAWARE
            
            333-109458
            
            13-4204191(State
      or other jurisdiction of
              incorporation
      or organization)
            
            (Commission
      File No.)
            
            (IRS
      Employee Identification No.)





927
Canada Court


City
of Industry, California 91748


(Address
of Principal Executive Offices)


_______________




(626)
581-9098


(Issuer
Telephone number)


_______________





5499
North Federal Highway, Suite D, Boca Raton, Florida 33487


(561)
989-3600


(Former
Name or Former Address 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 T 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 (Check one):




Large
      Accelerated Filer o
            Accelerated
      Filer o
            Non-Accelerated
      Filer o
            Smaller
      Reporting Company x





Indicate
by check mark whether the registrant is a shell company as defined in Rule 12b-2
of the Exchange Act.


Yes o No x





State the
number of shares outstanding of each of the issuer’s classes of common equity,
as of as of August 20, 2008: 34,970,007shares
of Common Stock.


















CHINA
GROWTH DEVELOPMENT, INC.





FORM
10-Q




June
30, 2008




INDEX








PART
I-- FINANCIAL INFORMATION




Item
      1.
            Financial
      StatementsItem
      2.
            Management’s
      Discussion and Analysis of Financial ConditionItem
      3
            Quantitative
      and Qualitative Disclosures About Market RiskItem
      4T.
            Control
      and Procedures




PART
II-- OTHER INFORMATION




Item
      1
            Legal
      ProceedingsItem
      1A
            Risk
      FactorsItem
      2.
            Unregistered
      Sales of Equity Securities and Use of ProceedsItem
      3.
            Defaults
      Upon Senior SecuritiesItem
      4.
            Submission
      of Matters to a Vote of Security HoldersItem
      5.
            Other
      InformationItem
      6.
            Exhibits
      and Reports on Form 8-K




SIGNATURE













Item 1. Financial
Information












CHINA
GROWTH DEVELOPMENT, INC.


(an
exploration stage company)




FINANCIAL
STATEMENTS




AS
OF JUNE 30, 2008










CHINA GROWTH DEVELOPMENT, INC. AND
      SUBSIDIARIESCONSOLIDATED
      BALANCE SHEETSAssets
              
              June
      30,
                2008
              
              
              December
      31,
                2007(Unaudited)
              
              
              (Audited)Current
      AssetsCash
      and cash equivalents
              
              $
              1,027,498
              
              
              $
              1,184,621Accounts
      receivable, net
              
              
              14,100
              
              
              
              -Inventory
              
              
              24,947
              
              
              
              -Other
      receivables, net of allowance for doubtful accounts
$74,713
              
              
              33,816
              
              
              
              8,947Other
      receivables from related party
              
              
              144,585
              
              
              
              92,634Interest
      receivables from related parties
              
              
              9,160
              
              
              
              9,160Notes
      receivable from related party
              
              
              155,533
              
              
              
              137,088Prepaid
      expenses
              
              
              -
              
              
              
              22,179Advances
      to suppliers
              
              
              11,654,428
              
              
              
              10,885,969Total
      Current Assets
              
              
              13,064,067
              
              
              
              12,340,598Fixed
      assets, net
              
              
              60,964,412
              
              
              
              58,139,771Intangible
      assets, net
              
              
              10,827,576
              
              
              
              10,288,717Total
      Assets
              
              $
              84,856,055
              
              
              $
              80,769,086Liabilities and
      Stockholders' EquityCurrent
      LiabilitiesAccounts
      payable and accrued expenses
              
              $
              28,940
              
              
              $
              205,627Loans
      payable
              
              
              2,492,378
              
              
              
              1,985,030Loans
      payable to related parties
              
              
              1,101,246
              
              
              
              358,548Construction
      payable
              
              
              2,501,774
              
              
              
              3,095,639Income
      tax payable
              
              
              268,942
              
              
              
              229,343Other
      payable
              
              
              463,156
              
              
              
              495,774Deferred
      revenue - current
              
              
              8,357,591
              
              
              
              9,530,814Total
      Current Liabilities
              
              
              15,214,027
              
              
              
              15,900,775Deferred
      revenue - non-current
              
              
              28,567,884
              
              
              
              29,501,367Total
      Liabilities
              
              
              43,781,911
              
              
              
              45,402,142Minority
      interest
              
              
              15,061,960
              
              
              
              7,159,250Stockholders'
      EquityPreferred
      stock - $.0001 par value; 10,000 shares authorized, 0
    sharesissued
      and outstanding
              
              
              -
              
              
              
              -Common
      stock - $.0001 par value; 200,000,000 shares authorized,34,970,007
      and 31,500,000 shares issued and outstanding
              
              
              3,497
              
              
              
              3,150Additional
      paid-in capital
              
              
              7,277,990
              
              
              
              9,131,176Other
      comprehensive income
              
              
              2,842,102
              
              
              
              1,958,238Retained
      earnings
              
              
              15,888,595
              
              
              
              17,115,130Total
      Stockholders' Equity
              
              
              26,012,184
              
              
              
              28,207,694Total
      Liabilities and Stockholders' Equity
              
              $
              84,856,055
              
              
              $
              80,769,086




The accompanying notes are
an integral part of these consolidated financial statements




1




CHINA GROWTH DEVELOPMENT, INC. AND
      SUBSIDIARIESCONSOLIDATED
      STATEMENTS OF OPERATIONS(UNAUDITED)For
      The Three Months
                Ended
      June 30,
              
              
              For
      The Six Months
                Ended
      June 30,2008
              
              
              2007
              
              
              2008
              
              
              2007Net
      revenue
              
              $
              3,738,624
              
              
              $
              3,459,975
              
              
              $
              7,407,703
              
              
              $
              6,195,900Cost
      of revenue
              
              
              36,361
              
              
              
              -
              
              
              
              36,361
              
              
              
              -Gross
      Profit
              
              
              3,702,263
              
              
              
              3,459,975
              
              
              
              7,371,342
              
              
              
              6,195,900General,
      selling and administrative expenses
              
              
              2,548,397
              
              
              
              1,708,276
              
              
              
              4,339,844
              
              
              
              3,422,813Operating
      income
              
              
              1,153,866
              
              
              
              1,751,699
              
              
              
              3,031,498
              
              
              
              2,773,087Non-operating
      income (expenses)Interest
      income
              
              
              1,494
              
              
              
              -
              
              
              
              3,466
              
              
              
              3,714Interest
      expense
              
              
              (72,679
              )
              
              
              (221,931
              )
              
              
              (176,561
              )
              
              
              (138,971
              )Other
      expense
              
              
              (80,982
              )
              
              
              -
              
              
              
              (101,548
              )
              
              
              -Total
      non-operating expenses
              
              
              (152,167
              )
              
              
              (221,931
              )
              
              
              (274,643
              )
              
              
              (135,257
              )Income
      before provision for income tax
              
              
              1,001,699
              
              
              
              1,529,768
              
              
              
              2,756,855
              
              
              
              2,637,830Provision
      for income tax
              
              
              22,534
              
              
              
              17,898
              
              
              
              43,069
              
              
              
              30,863Net
      income before minority interest
              
              
              979,165
              
              
              
              1,511,870
              
              
              
              2,713,786
              
              
              
              2,606,967Minority
      interest
              
              
              568,817
              
              
              
              357,886
              
              
              
              1,254,647
              
              
              
              148,067Net
      income
              
              $
              410,348
              
              
              $
              1,153,983
              
              
              $
              1,459,138
              
              
              $
              2,458,900Net
      earnings per share:Basic
      & diluted
              
              $
              0.03
              
              
              $
              0.05
              
              
              $
              0.08
              
              
              $
              0.08Weighted
      average number of shares outstanding:Total
      Current Liabilities
              
              
              32,562,612
              
              
              
              31,500,000
              
              
              
              32,031,306
              
              
              
              31,500,000




The accompanying notes are
an integral part of these consolidated financial statements




2




CHINA
      GROWTH DEVELOPMENT, INC. AND SUBSIDIARIESCONSOLIDATED
      STATEMENTS OF CASH FLOWS(UNAUDITED)For
      The Six Months
                Ended
      June 30,2008
              
              2007CASH
      FLOWS FROM OPERATING ACTIVITIESNet
      income
              
              $
              1,459,138
              
              
              $
              2,458,900Adjustments to
      reconcile net income to net cashprovided by
      operating activities:Depreciation
      & amortization
              
              
              1,182,313
              
              
              
              868,972Minority
      interest
              
              
              1,254,647
              
              
              
              148,067Warrants issued
      for compensation
              
              
              191,138
              
              
              
              -Warrants issued
      in reverse acquisition
              
              
              689,347
              
              
              
              -Decrease
      (increase) in current assets:Accounts
      receivable
              
              
              8,883
              
              
              
              -Inventories
              
              
              17,683
              
              
              
              -Other
      receivable
              
              
              (29,653
              )
              
              
              (207,636
              )Other
      receivable from related parties
              
              
              (43,651
              )
              
              
              -Interest
      receivable from related parties
              
              
              563
              
              
              
              3,648Advances to
      suppliers
              
              
              (74,853
              )
              
              
              -Prepaid
      expenses
              
              
              30,369
              
              
              
              141,245Increase (decrease)
      in liabilities:Construction
      payable
              
              
              (765,553
              )
              
              
              (1,106,882
              )Other
      payable
              
              
              (62,080
              )
              
              
              (239,744
              )Tax
      payable
              
              
              25,605
              
              
              
              2,647,551Accrued
      expense
              
              
              (206,256
              )
              
              
              169,693Deferred
      revenue
              
              
              (4,440,735
              )
              
              
              (2,819,783
              )Net
      cash (used in) provided by operating activities
              
              
              (763,095
              )
              
              
              2,064,032CASH
      FLOWS FROM INVESTING ACTIVITIESCash acquired
      on reverse acquisition
              
              
              3,742
              
              
              
              -Acquisition
      of property & equipment
              
              
              (229,055
              )
              
              
              (837,037
              )Proceeds from
      loan receivables from employees
              
              
              9,216
              
              
              
              -Proceeds from
      loan receivables from related parties
              
              
              -
              
              
              
              (101,930
              )Proceeds from
      loan receivables from others
              
              
              -
              
              
              
              59,904Advance to
      related parties for notes receivable
              
              
              (9,435
              )
              
              
              -Net
      cash used in investing activities
              
              
              (225,532
              )
              
              
              (879,063
              )CASH
      FLOWS FROM FINANCING ACTIVITIESNet proceeds
      from loans payable
              
              
              369,320
              
              
              
              -Net proceeds
      from loans from related parties
              
              
              394,383
              
              
              
              4,616Repayments of
      short-term loan
              
              
              -
              
              
              
              (1,222,523
              )Proceeds from
      long-term debt
              
              
              -
              
              
              
              1,070,857Net
      cash provided by (used in) financing activities
              
              
              763,703
              
              
              
              (147,050
              )EFFECT
      OF EXCHANGE RATE CHANGE ON CASH AND CASH EQUIVALENTS
              
              
              67,800
              
              
              
              82,505NET
      (DECREASE) INCREASE IN CASH & CASH EQUIVALENTS
              
              
              (157,123
              )
              
              
              1,120,423CASH
      & CASH EQUIVALENTS, BEGINNING BALANCE
              
              
              1,184,621
              
              
              
              1,676,718CASH
      & CASH EQUIVALENTS, ENDING BALANCE
              
              $
              1,027,498
              
              
              $
              2,797,141SUPPLEMENTAL
      DISCLOSURES:Interest
      paid
              
              $
              172,617
              
              
              $
              138,971Income tax
      paid
              
              $
              -
              
              
              $
              -




The accompanying notes are
an integral part of these consolidated financial statements




3





CHINA
GROWTH DEVELOPMENT INC. AND SUBSIDIARIES
 NOTES
TO FINANCIAL STATEMENTS
 (Unaudited)


NOTE
1. ORGANIZATION
AND BASIS OF PRESENTATION
 
 China
Growth Development, Inc. (“CGDI”, or “the Company”) is a Delaware corporation
that was initially engaged in the business of marketing and retailing a broad
line of high quality value-priced sun care products in Florida through its
wholly owned subsidiary Teeka Tan, Inc.  CGDI was incorporated under
the laws of the State of Delaware in April 2002, under the name IHealth
Inc.  In December 2005, Ihealth, Inc changed its name to Teeka Tan
Products Inc.  On December 13, 2007, Teeka Tan Products Inc. changed
its name to China Growth Development, Inc.
 
 On May 7,
2008, the reverse acquisition between CGDI and Taiyuan Rongan Business Trading
Company, Limited (“TRBT”), a company incorporated under the laws of the People’s
Republic of China (“PRC) was completed pursuant to the Stock for Stock
Equivalent Exchange Agreement and Plan entered into by CGDI and TRBT on November
12, 2007.  All of TRBT’s existing capital contributors assigned 80% of
their capital contributions in TRBT to CGDI in exchange for an aggregate of
31,500,000 shares of CGDI’s common stock and common stock purchase warrants to
purchase an aggregate of 1,400,000 shares of CGDI’s common stock at an exercise
price of $0.50 per share.
 
 TRBT was
incorporated in Taiyuan City, Shanxi Province, China in December 2005 under the
laws of the PRC.  TRBT is engaged in the business of building and
operation of commercial real estates in China.  TRBT holds 76.1% of
the issued and outstanding capital contributions of five subsidiaries organized
in China that owns and operates shopping malls.
 
 The five
subsidiaries of TRBT, including Yudu Minpin Shopping Mall (“Yudu”), Xicheng
Shopping Mall (“Xicheng”, also known as Taiyuan Clothing City), Jingpin Clothing
City (“Jingpin”), Longma Shopping Mall (“Longma”), and Xindongcheng Clothing
Distribution Mall (“Xindongcheng”) were owned initially by Taiyuan Clothing City
Group (“TCCG”), the predecessor company of TRBT, prior to May,
2003.  During the year 2003, these five shopping malls were acquired
by individuals and incorporated as five separate business
entities.  In January, 2005, TCCG reacquired 51% ownership of each of
five shopping malls from the individual shareholders and increased its
ownerships to 76.1%.
 
 In
December 2005, TRBT, which is related to Taiyuan Clothing City Group (TCCG)
through common ownership, was incorporated.  In December 2005, TRBT
acquired all the shares owned by TCCG for the five shopping
malls.  All five shopping malls are located in Taiyuan City, Shanxi
Province, China.  TRBT leases each shopping mall booth to commercial
tenants conducting business in retail, wholesale and distribution of clothes,
shoes, cosmetics, beddings, etc.
 
 The
accompanying unaudited interim financial statements have been prepared pursuant
to the rules and regulations of the Securities and Exchange Commission and
generally accepted accounting principles for interim financial
reporting.  Accordingly, they do not include all the information and
footnotes required by generally accepted accounting principles for complete
financial statements.  In the opinion of management, all adjustments
(consisting of normal recurring adjustments) considered necessary for fair
presentation have been included.  Operating results for the six-month
period ended June 30, 2008 are not necessarily indicative of the results that
may be expected for the year ended December 31, 2008.
    4
 CHINA
GROWTH DEVELOPMENT INC. AND SUBSIDIARIES
 NOTES
TO FINANCIAL STATEMENTS
 (Unaudited)
 
 NOTE
2. SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES
 
 Basis
of consolidation
 
 Under
accounting principles generally accepted in the United States, the share
exchange is considered to be a capital transaction in substance, rather than a
business combination. That is, the share exchange is equivalent to the issuance
of stock by CGDI for the net monetary assets of TRBT, accompanied by a
recapitalization, and is accounted for as a change in capital structure.
Accordingly, the accounting for the share exchange will be identical to that
resulting from a reverse acquisition, except no goodwill will be recorded. Under
reverse takeover accounting, the post reverse acquisition comparative historical
financial statements of the legal acquirer, CGDI, are those of the legal
acquiree which are considered to be the accounting acquirer, TRBT. Shares and
per share amounts stated have been adjusted to reflect the merger.
 
 Given
that TRBT is considered to have acquired CGDI in the reverse acquisition
effective May 7, 2008, and that its capital contributors currently have voting
control of CGDI, the accompanying financial statements and related disclosures
in the notes to financial statements present the financial position as of June
30, 2008 and December 31, 2007, and the operations for the three months and six
months ended June 30, 2008, and 2007, of TRBT and its subsidiaries under the
name of CGDI. The reverse acquisition has been recorded as a recapitalization of
CGDI, with the consolidated net assets of TRBT and its subsidiaries, and net
assets CGDI brought forward at their historical bases. The costs associated with
the reverse acquisition have been expensed as incurred.
 
 Intercompany
accounts and transactions have been eliminated in
consolidation.  Certain data in the financial statements of the prior
period has been reclassified to conform to the current period
presentation.
 
 Revenue
recognition and deferred revenue
 
 The
Company's revenue recognition policies are in compliance with Staff Accounting
Bulletin (SAB) 104. Revenue is recognized when services are rendered to
customers when a formal arrangement exists, the price is fixed or determinable,
the delivery is completed, no other significant obligations of the Company exist
and collectability is reasonably assured. The Company recognizes revenue net of
an allowance for estimated returns, at the time the merchandise is sold or
services performed. The allowance for sales returns is estimated based on the
Company’s historical experience. Sales taxes are presented on a net basis
(excluded from revenues and costs). If the Company had any merchandise on
consignment, the related sales from merchandise on consignment would be recorded
when the retailer sold such merchandise. Payments received before all of the
relevant criteria for revenue recognition are satisfied are recorded as deferred
revenue.
 
 The
Company has two major sources of revenue from its shopping mall leasing
business, including rental revenue and management services revenue. Rent
covering the entire leasing period is generally collected up front from the
tenants upon signing the lease agreements, and recorded as deferred revenue.
Rental revenue is then recognized over the respective lease term, generally on a
monthly basis. Deferred revenue is classified as current and non-current based
on the length of maturities. In addition to rental revenue, the Company charges
management services fee from its tenants based on the size of the leasing unit.
Such management services fee is generally collected once a month, or once every
two to three months at certain locations. Fees collected in advance to the
months of services being performed will be deferred and recognized as income in
the later period being earned.
 
 As of
June 30, 2008 and December 31, 2007, current deferred revenue was $8,357,591 and
$9,530,814, whereas non-current deferred revenue was $28,567,884 and
$29,501,367, respectively.
 
  5
  CHINA
GROWTH DEVELOPMENT INC. AND SUBSIDIARIES
 NOTES
TO FINANCIAL STATEMENTS
 (Unaudited)
  Shipping
and handling costs
 
 Amounts
billed to customers in sales transactions related to shipping and handling
represent revenues earned for the goods provided and are included in
sales.  Costs of shipping and handling are included in the cost of
goods sold.
 
 Use
of estimates
 
 The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
 
 Cash
and cash equivalents
 
 Cash and
cash equivalents include cash on hand and cash in time deposits, certificates of
deposit and all highly liquid debt instruments with original maturities of three
months or less.
 
 Accounts
receivable
 
 We
maintain allowances for doubtful accounts for estimated losses resulting from
the inability of our customers to make required payments.  If the
financial condition of customers were to deteriorate, resulting in an impairment
of their ability to make payments, additional allowances may be
required.
 
 Inventories
 
 The
Company's inventories consist of purchased finished goods, labels and bottles.
Inventories are stated at lower of cost or market.  Cost is determined
on the first-in, first-out basis.
 
 Provision
for slow moving and obsolete inventory
 
 We write
down our inventory for estimated unmarketable inventory or obsolescence equal to
the difference between the cost of inventory and the estimated market value
based on assumptions about future demand and market conditions.  If
actual market conditions are less favorable than those projected by management,
additional inventory write-downs may be required.
 
 Property
and equipment
 
 Machinery
and Equipment are stated at cost. Expenditures for maintenance and repairs are
charged to earnings as incurred; additions, renewals and betterments are
capitalized. When property and equipment are retired or otherwise disposed of,
the related cost and accumulated depreciation are removed from the respective
accounts, and any gain or loss is included in operations. Depreciation of auto
is provided using the straight-line method over 5 to 20 years. Depreciation of
furniture is provided using the straight-line method over 5 to 10 years.
Depreciation of machinery and equipments is provided using the straight-line
method over 3 to 30 years. Depreciation of building is provided using the
straight-line method over 30 to 40 years
 
  6
 CHINA
GROWTH DEVELOPMENT INC. AND SUBSIDIARIES
 NOTES
TO FINANCIAL STATEMENTS
 (Unaudited)
   Impairment
of long-lived assets
 
 Effective
January 1, 2002, the Company adopted Statement of Financial Accounting Standards
No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets" ("SFAS
144"), which addresses financial accounting and reporting for the impairment or
disposal of long-lived assets and supersedes SFAS No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of,"
and the accounting and reporting provisions of APB Opinion No. 30, "Reporting
the Results of Operations for a Disposal of a Segment of a Business." The
Company periodically evaluates the carrying value of long-lived assets to be
held and used in accordance with SFAS 144. SFAS 144 requires impairment losses
to be recorded on long-lived assets used in operations when indicators of
impairment are present and the undiscounted cash flows estimated to be generated
by those assets are less than the assets' carrying amounts. In that event, a
loss is recognized based on the amount by which the carrying amount exceeds the
fair market value of the long-lived assets. Loss on long-lived assets to be
disposed of is determined in a similar manner, except that fair market values
are reduced for the cost of disposal. Based on its review, the Company believes
that, as of June 30, 2008, there were no significant impairments of its
long-lived assets.
 
 Fair
value of financial instruments
 
 Statement
of financial accounting standard No. 107, Disclosures about fair value of
financial instruments, requires that the Company disclose estimated fair values
of financial instruments. The carrying amounts reported in the statements of
financial position for current assets and current liabilities qualifying as
financial instruments are a reasonable estimate of fair value.
 
 Earnings
per share
 
 The
Company has adopted SFAS No. 128, "Earnings per Share."  Earnings per
common share are computed by dividing income available to common shareholders by
the weighted average number of common shares outstanding during the
period.  As of June 30, 2008 and December 31, 2007 the Company had
common stock warrants that would have converted into 1,930,000 and 30,000 shares
of common stock, respectively.  The terms of the stock warrants allow
the shares to be converted at a conversion price ranging from $0.5 to $7 per
share, which was above the average closing price of the Company’s stock during
the year 2008.  As such, it is more likely that the warrants would be
not converted, which had no dilutive effect to the earnings per
share.
 
 Stock-based
compensation
 
 Effective
January 1, 2006 The Company adopted SFAS No. 123R "Share-Based Payment" ("SFAS
123R"), a revision to SFAS No. 123 "Accounting for Stock-Based Compensation"
("SFAS 123").  Prior to the adoption of SFAS 123R, the Company
accounted for stock options in accordance with APB Opinion No. 25 "Accounting
for Stock Issued to Employees" (the intrinsic value method), and accordingly,
recognized no compensation expense for stock option grants.
 
 Under the
modified prospective approach, the provisions of SFAS 123R apply to new awards
and to awards that were outstanding on January 1, 2006 that are subsequently
modified, repurchased pr cancelled.  Under the modified prospective
approach, compensation cost recognized in the year ended December 31, 2006
includes compensation cost for all share-based payments granted prior to, but
not yet vested as of January 1, 2006, based on the grant-date fair value
estimated in accordance with the original provisions of SFAS 123, and the
compensation costs for all share-based payments granted subsequent to January
31, 2006, based on the grant-date fair value estimated in accordance with the
provisions of SFAS 123R.  Prior periods were not restated to reflect
the impact of adopting the new standard.
   7
 CHINA
GROWTH DEVELOPMENT INC. AND SUBSIDIARIES
 NOTES
TO FINANCIAL STATEMENTS
 (Unaudited)
 Income
taxes
 
 The
Company utilizes SFAS No. 109 (“SFAS 109”), "Accounting for Income Taxes," which
requires the recognition of deferred tax assets and liabilities for the expected
future tax consequences of events that have been included in the financial
statements or tax returns.  Under this method, deferred income taxes
are recognized for the tax consequences in future years of differences between
the tax bases of assets and liabilities and their financial reporting amounts at
each period end based on enacted tax laws and statutory tax rates applicable to
the periods in which the differences are expected to affect taxable income.
Valuation allowances are established, when necessary, to reduce deferred tax
assets to the amount expected to be realized.
 
 The
Company adopted the provisions of FASB Interpretation No. 48, “Accounting for
Uncertainty in Income Taxes” (“FIN 48”), effective January 1,
2007.  FIN 48 was issued to clarify the requirements of SFAS 109
relating to the recognition of income tax benefits.  FIN 48 provides a
two-step approach to recognizing and measuring tax benefits when the benefits’
realization is uncertain.  The first step is to determine whether the
benefit is to be recognized; the second step is to determine the amount to be
recognized:
 
 §
              Income
      tax benefits should be recognized when, based on the technical merits of a
      tax position, the entity believes that if a dispute arose with the taxing
      authority and were taken to a court of last resort, it is more likely than
      not (i.e. a probability of greater than 50 percent) that the tax position
      would be sustained as filed; and
 §
              If
      a position is determined to be more likely than not of being sustained,
      the reporting enterprise should recognize the largest amount of tax
      benefit that is greater than 50 percent likely of being realized upon
      ultimate settlement with the taxing
authority.
 
 As a
result of the implementation of FIN 48, the company made a comprehensive review
of its portfolio of tax positions in accordance with recognition standards
established by FIN 48.  The Company recognized no material adjustments
to liabilities or stockholders’ equity in lieu of the
implementation.  The adoption of FIN 48 did not have a material impact
on the Company’s financial statements.
  Segment
reporting
  Statement
of Financial Accounting Standards No. 131 ("SFAS 131"), "Disclosure about
Segments of an Enterprise and Related Information" requires use of the
"management approach" model for segment reporting.  The management
approach model is based on the way a company's management organizes segments
within the company for making operating decisions and assessing
performance.  Reportable segments are based on products and services,
geography, legal structure, management structure, or any other manner in which
management disaggregates a company.
  Foreign
currency translation and comprehensive income
 
 The
Company accounts for foreign currency translation pursuant to SFAS No. 52,
"Foreign Currency Translation" ("SFAS 52").  The functional currency
of the Company’s shopping mall unit leasing business in China (TRBT) is the
Chinese Yuan Renminbi (CNY).  TRBT’s financial statements were
maintained and presented in CNY, which were translated into U.S. Dollars (USD)
in accordance with SFAS 52.  Under SFAS 52, all assets and liabilities
are translated at the current exchange rate at the end of each fiscal period,
stockholders’ equity are translated at the historical rates, and income
statement items are translated at the average exchange rates prevailing
throughout the respective periods.  Gains or losses on financial
statement translation from foreign currency are recorded as separate components
in the equity section of the balance sheet, under other comprehensive income in
accordance with SFAS No. 130, “Reporting Comprehensive Income”.
 
  8
 CHINA
GROWTH DEVELOPMENT INC. AND SUBSIDIARIES
 NOTES
TO FINANCIAL STATEMENTS
 (Unaudited)
   Statement
of cash flows
 
 In
accordance with Statement of Financial Accounting Standards No. 95, “Statement
of Cash Flows,” cash flows from the Company’s operations are calculated based
upon the local currencies.  As a result, amounts related to assets and
liabilities reported on the statement of cash flows will not necessarily agree
with changes in the corresponding balances on the balance sheet.
 
 Recent
pronouncements
 
 In
September 2006, the Financial Accounting Standards Board (“FASB”) issued SFAS
No. 157 (“SFAS 157”), “Fair Value Measurements”, which is effective for
fiscal years beginning after November 15, 2007 with earlier adoption encouraged.
 SFAS 157 defines fair value, establishes a framework for measuring
fair value in generally accepted accounting principles, and expands disclosures
about fair value measurements.  In February 2008, the FASB issued FASB
Staff Position FAS 157-2, Effective Date of FASB Statement No. 157 which delayed
the effective date of SFAS 157 for all non-financial assets and
liabilities, except those that are recognized or disclosed at fair value in the
financial statements on a recurring basis, until January 1, 2009.  The
Company has not yet determined the impact the implementation of SFAS 157 will
have on the Company’s non-financial assets and liabilities which are not
recognized or disclosed on a recurring basis.  However, the Company does
not anticipate that the full adoption of SFAS 157 will significantly impact
their consolidated financial statements.
 
 In
February 2007, FASB issued SFAS No. 159 (“SFAS 159”), “The Fair Value Option for
Financial Assets and Financial Liabilities”.  This Statement permits
entities to choose, at specified election dates, to measure eligible financial
assets and liabilities at fair value that are not otherwise required to be
measured at fair value.  The objective of SFAS 159 is to improve
financial reporting by providing entities with the opportunity to mitigate
volatility in reported earnings caused by measuring related assets and
liabilities differently without having to apply complex hedge accounting
provisions.  The Company adopted SFAS 159 on January 1, 2008, but the
implementation of SFAS 159 did not have a significant impact on the
Company's financial position or results of operations.
 
 In
December 2007, the FASB issued SFAS No. 141 (Revised 2007), “Business
Combinations” (“SFAS 141R).  SFAS 141R changes how a reporting
enterprise accounts for the acquisition of a business.  SFAS 141R
establishes principles and requirements for how an acquirer recognizes and
measures in its financial statements the identifiable assets acquired, the
liabilities assumed, any noncontrolling interest in the acquiree and the
goodwill acquired. SFAS 141R also establishes disclosure requirements to enable
the evaluation of the nature and financial effects of the business
combination. SFAS 141R is effective for fiscal years beginning on or after
December 15, 2008 and early adoption and retrospective application is
prohibited.  The Company is currently evaluating the potential impact
of the adoption of SFAS 141R on its consolidated financial position, results
of operations or cash flows.
 
 In
December 2007, the FASB issued SFAS No. 160, “Noncontrolling Interests in
Consolidated Financial Statements”, which is an amendment of Accounting Research
Bulletin (“ARB”) No. 51.  This statement clarifies that a
noncontrolling interest in a subsidiary is an ownership interest in the
consolidated entity that should be reported as equity in the consolidated
financial statements.  This statement changes the way the consolidated
income statement is presented, thus requiring consolidated net income to be
reported at amounts that include the amounts attributable to both parent and the
noncontrolling interest.  This statement is effective for the fiscal
years, and interim periods within those fiscal years, beginning on or after
December 15, 2008.  The Company is currently evaluating the potential
impact of the adoption of SFAS 160 on its consolidated financial position,
results of operations or cash flows.
 
  9
 CHINA
GROWTH DEVELOPMENT INC. AND SUBSIDIARIES
 NOTES
TO FINANCIAL STATEMENTS
 (Unaudited)
  In May
2008, FASB issued SFAS No. 162 (“SFAS 162”), “The Hierarchy of Generally
Accepted Accounting Principles”.  This Standard identifies the sources
of accounting principles and the framework for selecting the principles to be
used in the preparation of financial statements of nongovernmental entities
that are presented in conformity with generally accepted accounting
principles.  SFAS 162 directs the hierarchy to the entity, rather than
the independent auditors, as the entity is responsible for selecting accounting
principles for financial statements that are presented in conformity with
generally accepted accounting principles.  The Standard is effective 60
days following SEC approval of the Public Company Accounting Oversight
Board amendments to remove the hierarchy of generally accepted
accounting principles from the auditing standards.  The company
does not believe this pronouncement will impact its financial
statements.
 
 In April
2008, the FASB issued FASB Staff Position (FSP) FAS 142-3, “Determination of the
Useful Life of Intangible Assets”, which amends the factors that should be
considered in developing renewal or extension assumptions used to determine the
useful life of a recognized intangible asset under FASB Statement No. 142,
“Goodwill and Other Intangible Assets”.  This Staff Position is effective
for financial statements issued for fiscal years beginning after December
15, 2008, and interim periods within those fiscal years.  Early adoption is
prohibited.  Application of this FSP is not expected to have a
significant impact on the financial statements.
 
 In May
2008, the FASB issued FASB Staff Position (FSP) APB 14-1, “Accounting for
Convertible Debt That May Be Settled in Cash upon Conversion (Including
Partial Cash Settlement)” ("FSP 14-1").  FSP 14-1 will be effective for
financial statements issued for fiscal years beginning after December 15,
2008.  The FSP includes guidance that convertible debt instruments that may
be settled in cash upon conversion should be separated between the
liability and equity components, with each component being accounted for in a
manner that will reflect the entity's nonconvertible debt borrowing rate
when interest costs are recognized in subsequent periods.  FSP 14-1 is not
currently applicable to the Company since the Company does not have
convertible debt.
 
 In June
2008, the FASB issued FSP EITF 03-6-1, “Determining Whether Instruments Granted
in Share-Based Payment Transactions are Participating Securities”.
 This FSP provides that unvested share-based payment awards that contain
nonforfeitable rights to dividends or dividend equivalents (whether paid or
unpaid) are participating securities and shall be included in the computation of
earnings per share pursuant to the two-class method.  The Company does
not currently have any share-based awards that would qualify as participating
securities.  Therefore, application of this FSP is not expected to
have an effect on the Company's financial reporting.
 
 NOTE
3. REVERSE
ACQUISITION
 
 On May 7,
2008, CGDI completed the acquisition of TRBT pursuant to the Stock for Stock
Equivalent Exchange Agreement and Plan (the “Exchange Agreement”) among CGDI,
TRBT, and each of the equity owners of TRBT (“TRBT
Shareholders”).  Pursuant to the Exchange Agreement, CGDI issued
31,500,000 shares of its common stock, representing 97.3% of CGDI's issued and
outstanding common stock immediately following the acquisition and 1,400,000
warrants exercisable at the rate of one warrant for one common share at a price
of $0.5 per share, in exchange of 80% equity interest in TRBT.
 
  10
 CHINA
GROWTH DEVELOPMENT INC. AND SUBSIDIARIES
 NOTES
TO FINANCIAL STATEMENTS
 (Unaudited)
  As TRBT
Shareholders have become the majority shareholder of the consolidated entity
comprising CGDI and TRBT, the acquisition has been accounted for as a reverse
acquisition using the purchase method of accounting, where CGDI (the legal
acquirer) is deemed to be the accounting acquiree and TRBT (the legal acquiree)
to be the accounting acquirer.  However, the acquisition is also
considered to be a capital transaction in substance as TRBT (a private operating
company) has been merged into CGDI (a public corporation with nominal
non-monetary net assets) with the shareholders of CGDI, the former public
corporation continuing only as passive investors.  Hence, the cost of
the acquisition has been measured at the carrying value of the net assets of
CGDI with no goodwill or other intangible being recorded in accordance with the
accounting interpretation and guidance issued by the SEC staff.  The
results of CGDI have been consolidated from the date of the
acquisition.
 
 NOTE
4. ACCOUNTS
RECEIVABLE
 
 Accounts
receivable consisted of the following:
 June
      30,
                2008
              
              
              December
      31, 2007Accounts
      receivable
              
              $
              19,300
              
              
              $
              -Less:
      allowance for doubtful accounts
              
              
              (5,200
              )
              
              
              -Accounts
      receivable, net
              
              $
              14,100
              
              
              $
              -
 
 NOTE
5. ADVANCES
TO SUPPLIERS
 
 Advances
to suppliers amounted to $11,654,428 and $10,885,969 as of June 30, 2008 and
December 31, 2007, respectively.  The advances mainly included
payments made to purchase a building under an agreement.  The title of
the building is in the process of transfer to the Company.
 
 NOTE
6. PROPERTY
AND EQUIPMENT
 
 At June
30, 2008 and December 31, 2007, the following were the details of the property
and equipment:
  June
      30,
                
                
                December
      31,2008
                
                
                2007Auto
                
                $
                1,022,325
                
                
                $
                889,116Machinery
      & equipment
                
                
                4,172,610
                
                
                
                3,888,599Building
                
                
                66,205,800
                
                
                
                62,241,609Less:  Accumulated
      depreciation
                
                
                (10,436,323
                )
                
                
                (8,879,553
                )Net
                
                $
                60,964,412
                
                
                $
                58,139,771
  Depreciation
expense for the three months ended June 30, 2008 and 2007 was $535,773 and
$378,920, respectively.  Depreciation expense for the six months ended
June 30, 2008 and 2007 was $1,071,545 and $757,839, respectively.
 
 NOTE
7. INTANGIBLE
ASSETS
 
 The
Company’s five shopping mall subsidiaries under TRBT are located in Taiyuan
City, Shanxi Province, People’s Republic of China.  At November, 2005,
the five subsidiaries acquired the right to use the land from the Haozhuang
Village government.  Per the People's Republic of China's governmental
regulations, the Government owns all land. The Company has recognized the
amounts paid for the acquisition of rights to use land as intangible asset and
amortizing over a period of 36 to 50 years.
 
  11
 CHINA
GROWTH DEVELOPMENT INC. AND SUBSIDIARIES
 NOTES
TO FINANCIAL STATEMENTS
 (Unaudited)
  Net
intangible assets at June 30, 2008 and December 31, 2007 were as
follows:
 2008
                
                
                2007Rights
      to use
      land
                
                $
                11,439,618
                
                
                $
                10,756,652Less
      Accumulated
      amortization
                
                
                (612,042
                )
                
                
                (467,935
                )$
                10,827,576
                
                
                
                10288717
  Amortization
expense for the Company’s intangible assets for the three months ended June 30,
2008 and 2007 was $55,401 and $55,568, respectively.  Amortization
expense for the six months ended June 30, 2008 and 2007 was $110,768 and
$111,136, respectively.
 
 Amortization
expense for the Company’s intangible assets over the next five years is
estimated to be:
  June
      30,2009
                
                $
                241,0042010
                
                
                241,0042011
                
                
                241,0042012
                
                
                241,0042013
      and thereafter
                
                
                9,863,559$
                10,827,575
 NOTE 8. CONSTRUCTION
PAYABLE
 
 As of
June 30, 2008 and December 31, 2007, construction payable amounted to $2,501,774
and $3,095,639, respectively.  The Company’s construction payable
consists primarily of amounts payable for the construction of shopping
mall.
 
 NOTE
9. LOANS
PAYABLE
 
 As of
June 30, 2008 and December 31, 2007 loans payable consists the
following:
  2008
                
                
                2007Amount
                
                
                Annual
      Interest Rate
                
                Amount
                
                
                Annual
      Interest RateIndividuals
                
                $
                2,054,403
                
                
                
                8.37%-10.29%
                
                
                $
                1,573,767
                
                
                
                8.37%-10.29%Bank
                
                
                437,975
                
                
                
                10.29%
                
                
                
                411,263
                
                
                
                10.29%Related
      parties
                
                
                1,101,246
                
                
                
                10.29%
                
                
                
                358,548
                
                
                
                10.29%Total
                
                $
                3,593,624
                
                
                
                
                
                
                $
                2,343,578
  Loans
payable include the following items:
 
 Loans
payables to individuals amounted to $2,054,403 and $1,573,767 at June 30, 2008
and December 31, 2007, respectively.  These loans are due to unrelated
parties, due within one year, unsecured, and with an annual interest rate of
8.37%-10.29%.
 
 Loans
payable to related parties amounted to $1,101,246 and $358,548 at June 30, 2008
and December 31, 2007, respectively.  One of these loans in the amount
of $218,988 is secured by the building of Longma Shopping Mall.  The
other ones are unsecured, due within one year, with an annual interest rate of
10.29%.
   12
 CHINA
GROWTH DEVELOPMENT INC. AND SUBSIDIARIES
 NOTES
TO FINANCIAL STATEMENTS
 (Unaudited)
 Loans
payable to the bank amounted to $437,975 and $411,263 at June 30, 2008 and
December 31, 2007, respectively.  This loan is due within one year,
unsecured, and within an annual interest rate of 10.29%.
 
 NOTE
10. EQUITY
TRANSACTIONS
 
 In April
2006, the Company's Board of Directors adopted the Teeka Tan Products, Inc. 2006
Equity Compensation Plan (the "Plan"). The Company has reserved 10,000,000
shares of its common stock for issuance under the Plan, which was adopted to
provide the Company with flexibility in compensating certain of its sales,
administrative and professional employees and consultants and to conserve its
cash resources. The issuance of shares under the Plan is restricted to persons
who are closely-related to the Company and who provide it with bona fide
services in connection with the sales and marketing of its products or otherwise
in connection with its business as compensation. The eligible participants
include directors, officers, employees and non-employee consultants and
advisors. Management of the Company anticipates that a substantial portion of
the shares available under the Plan will be issued over time as compensation to
its employees and consultants and advisors who provide services in the sales,
marketing and promotion of the Company's products. The Board of Directors has no
present intent to issue any shares under the Plan to members of the Board who
are also the Company's executive officers.
 
 In
October 2006, the Company issued a total of 5,000 common stock options pursuant
to the Plan at an exercise price of $5.00 per share as compensation to an
employee. The fair market value of the options was estimated on the grant date
using the Black-Scholes option pricing model as required under SFAS 123R with
the following weighted average assumptions: expected dividend yield 0%,
volatility 155%, risk-free interest rate of 5.1%, and expected warrant life of
three months. The value of these options was immaterial. The Company received a
$35,000, 4% demand promissory note from the employee. The Company recorded a
subscription receivable in the amount of $25,000 for this demand notes. Between
January and February, 2007 the Company received $8,750 in payments on the
subscription receivable. The remaining $16,250 of the subscription receivable
was forgiven by the Company in October 2007.
 
 REVERSE
STOCK SPLIT
 
 On
November 12, 2007, the Company's stockholders approved a 1 for 100 reverse stock
split for its common stock.  As a result, stockholders of record at
the close of business on December 13, 2007, received one shares of common stock
for every hundred shares held. Common stock, additional paid-in capital and
share and per share data for prior periods have been restated to reflect the
stock split as if it had occurred at the beginning of the earliest period
presented.
 
 COMMON
STOCK AND WARRANTS
 
 The
Company issued 10,000 warrants on March 13, 2006, at an exercise price of $5.00
per share as partial compensation for licensing fees. The fair market value of
the warrants was estimated on the grant date using the Black-Scholes option
pricing model as required under SFAS 123 with the following weighted average
assumptions: expected dividend yield 0%, volatility 139%, risk-free interest
rate of 4.5%, and expected warrant life of one year. The Company fair valued
these warrants at $78,201. For the three months ended March 31, 2007 the Company
recorded $3,856 of amortization expense associated with the warrants. The
warrants expire on December 31, 2008.
 
  13
 CHINA
GROWTH DEVELOPMENT INC. AND SUBSIDIARIES
 NOTES
TO FINANCIAL STATEMENTS
 (Unaudited)
   In
November 2006, the Company entered into a one year agreement for certain
investor and public relations services. The Company issued 10,000 shares of
common stock with a fair value of $50,000 on the date of issuance together with
10,000 warrants with exercise price of $5.00 per share, 10,000 warrants with
exercise price of $6.00 and 10,000 warrants with exercise price of $7.00 per
share expiring on January 31, 2008. The fair value of the warrants was estimated
on the grant date using the Black-Scholes option pricing model as required under
SFAS 123 and EITF-96-18 with the following weighted average assumptions:
expected dividend yield 4.91%, volatility 155%, risk-free interest rate of
4.91%, and expected warrant life of six months. The Company fair valued these
warrants at $56,069. In April 2007 both parties mutually agreed to cancel the
agreement and the public relation firm returned it warrants.  During
the three and six months ended June 30, 2008 and 2007 the Company expensed $0
and $97,060, respectively, for the unamortized value of the
agreement.
 
 In
February 2007 the Company issued 2,000 shares of common stock for cash proceeds
of $10,000 to an investor.
 
 In March
2007 two executive officers converted a total of $270,833 of accrued salary into
shares of 54,167 shares of common stock at a price of $5.00 per share which was
equal to the fair value of the stock on the date of conversion.
 
 In March
2007 the Company issued 5,000 shares of common stock with a fair value of
$25,000 on the date of issuance to an employee for services. The Company
amortized the value over the one year term of the employee’s employment
agreement. In May 2007 the Company agreed to issue the employee an additional
3,000 share of common stock valued at $9,000 pursuant to his employment
agreement. The Company terminated the employment in June 2007 and has not issued
the employee the common stock. Management has asserted that the employee did not
perform services to earn the common stock. During the three months ended June
30, 2008 and 2007, the Company expensed $0 and $21,250, respectively, for the
unamortized value of the common stock received. During the six months ended June
30, 2008 and 2007, the Company expensed $0 and $25,000,
respectively.
 
 In March
2007, the Company issued 2,000 shares of common stock with a fair value of
$10,000 on the date of issuance to a consultant for services.
 
 In March
2007, the Company issued 1,000 shares of common stock with a fair value of
$4,000 on the date of issuance to a consultant for services.
 
 On May 7,
2008, the Company completed the reverse acquisition of TRBT pursuant to the
Stock for Stock Equivalent Exchange Agreement and Plan (the “Exchange
Agreement”) among CGDI, TRBT, and each of the equity owners of TRBT (“TRBT
Shareholders”). Pursuant to the Exchange Agreement, CGDI issued 31,500,000
shares of its common stock, representing 97.3% of CGDI's issued and outstanding
common stock immediately following the acquisition and 1,400,000 warrants
exercisable at the rate of one warrant for one common share at a price of $0.5
per share, in exchange of 80% equity interest in TRBT. The fair value of the
warrants was estimated on the grant date using the Black-Scholes option pricing
model as required under SFAS 123 and EITF-96-18 with the following weighted
average assumptions: expected dividend yield 0%, volatility 157.56%, risk-free
interest rate of 1.57%, and expected warrant life of twelve months. The Company
fair valued these warrants at $689,347.
 
 In May
2008, in consideration for services provided, the Company issued to Mirador
Consulting 500,000 warrants exercisable at the rate of one warrant for one share
of its common stock at a price of $1.00 per share expiring on November 5,
2008.  The fair value of the warrants was estimated on the grant date
using the Black-Scholes option pricing model as required under SFAS 123 and
EITF-96-18 with the following weighted average assumptions: expected dividend
yield 0%, volatility 157.56%, risk-free interest rate of 1.57%, and expected
warrant life of twelve months. The Company fair valued these warrants at
$191,138.
 
  14
 CHINA
GROWTH DEVELOPMENT INC. AND SUBSIDIARIES
 NOTES
TO FINANCIAL STATEMENTS
 (Unaudited)
   In June
2008, the Company issued 2,590,934 shares of common stock for the settlement of
the $200,000 convertible debenture previously issued on August 24, 2004 with
interest accrued at 10% per annum amounting to $91,767.
 
 PREFERRED
STOCK
 
 In March
2007 the Company amended its Certificate of Incorporation to authorize a class
of 10,000 shares of blank check preferred stock, par value $0.0001 per share.
Such shares are issuable with such designations, voting powers, if any,
preferences and relative, participating, optional or other special rights, and
such qualifications, limitations and restrictions, as are determined by
resolution of the Company's board of directors.
 
 NOTE
11. RELATED
PARTY TRANSACTIONS
 
 The
parties primarily refer to the original shareholders of TRBT and entities
related through one common shareholder, who is also a majority shareholder in
all the related entities.
 
 Other
receivables from related parties amounted to $144,585 and $92,634 as of June 30,
2008 and December 31, 2007, respectively.
 
 Notes
receivable from related party amounted to $155,533 and $137,088 as of June 30,
2008 and December 31, 2007, respectively.  Interest receivable
associated with the notes amounted to $9,160 as of June 30, 2008 and December
31, 2007.
 
 Loans
from related parties amounted to $1,101,246 and $358,548 as of June 30, 2008 and
December 31, 2007, respectively.  Interest rates ranged from 8.37% to
10.29% per annum.  All loans mature within one year.  One of
these loans in the amount of $205,632 was collateralized by the building of
Longma Shopping Mall.
 
 NOTE
12. INCOME
TAX
 
 The
Company is registered in the State of Delaware and has operations in primarily
two tax jurisdictions - the PRC and the United States.  For certain
operations in the U.S., the Company has incurred net accumulated operating
losses for income tax purposes.  The Company believes that it is more
likely than not that these net accumulated operating losses will not be utilized
in the future.  Therefore, the Company has provided full valuation
allowance for the deferred tax assets arising from the losses at these locations
as of June 30, 2008 and December 31, 2007.  Accordingly, the Company
has no net deferred tax assets.
 
 The
provision for income taxes from continuing operations on income consists of the
following for the six months ended June 30, 2008 and 2007:
 
 2008
              
              
              2007U.S.
      Current Income Tax ExpenseFederal
              
              $
              -
              
              
              $
              -State
              
              
              -
              
              
              
              -$
              -
              
              
              $
              -PRC
      Current Income Tax Expense
              
              
              43,069
              
              
              
              30,863Total
      Provision for Income Tax
              
              $
              43,069
              
              
              $
              30,863
   15
 CHINA
GROWTH DEVELOPMENT INC. AND SUBSIDIARIES
 NOTES
TO FINANCIAL STATEMENTS
 (Unaudited)
 
 The
following is a reconciliation of the statutory tax rate to the effective tax
rate for the six months ended June 30, 2008 and 2007:
 
 2008
              
              2007Tax
      expense (credit) at statutory rate – Federal
              34%
              
              -State
      tax expense net of federal taxes
              6%
              
              -Valuation
      allowance
              (40%)
              
              -Foreign
      income tax – PRC
              25%
              
              33%Net
      effect of non-taxable income/non-deductible expenses
              (23.4%)
              
              (31.83%)Effective
      tax rate
              1.6%
              
              1.17%
 
 United States of
America
 
 The
Company has significant income tax net operating losses carried forward from
prior years.  Due to the change in ownership of more than fifty
percent, the amount of NOL which may be used in any one year will be subject to
a restriction under section 382 of the Internal Revenue Code.  Due to
the uncertainty of the realizability of the related deferred tax assets, a
reserve equal to the amount of deferred income taxes has been established at
June 30, 2008. The Company has provided 100% valuation allowance to the deferred
tax assets as of June 30, 2008.
 
 People’s Republic of China
(PRC)
 
 Under the
Enterprise Income Tax (“EIT”) of the PRC, prior to 2007, Chinese enterprises are
generally subject to an income tax at an effective rate of 33% (30% statutory
income taxes plus 3% local income taxes) on income reported in the statutory
financial statements after appropriate tax adjustments, unless the enterprise is
located in a specially designated region for which more favorable effective tax
rates are applicable.    Beginning January 1, 2008, the new
EIT law has replaced the existing laws for Domestic Enterprises (“DEs”) and
Foreign Invested Enterprises (“FIEs”).  The new standard EIT rate of
25% will replace the 33% rate previously applicable to both DES and
FIEs.  The two year tax exemption, six year 50% tax reduction and tax
holiday for production-oriented FIEs will be eliminated.  The Company
is currently evaluating the effect of the new EIT law on its financial
position.
 
 The
following table sets forth the significant components of the provision for
income taxes for operation in PRC for the six months ended June 30, 2008 and
2007:
 
 2008
              
              
              2007Net
      taxable income
              
              $
              172,276
              
              
              $
              93,524Provision
      for income taxes at 25% and 33%, respectively
              
              $
              43,069
              
              
              $
              30,863


16




ITEM
2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS





The
information contained in Item 2 contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. Actual results may
materially differ from those projected in the forward-looking statements as a
result of certain risks and uncertainties set forth in this report. Although
management believes that the assumptions made and expectations reflected in the
forward-looking statements are reasonable, there is no assurance that the
underlying assumptions will, in fact, prove to be correct or that actual results
will not be different from expectations expressed in this report.




Overview





The
following discussion is an overview of the important factors that management
focuses on in evaluating our businesses, financial condition and operating
performance and should be read in conjunction with the financial statements
included in this Current Report on Form 8-K.  This discussion contains
forward-looking statements that involve risks and
uncertainties.  Actual results could differ materially from those
anticipated in these forward looking statements as a result of any number of
factors, including those set forth under the section entitled “Risk Factors” and
elsewhere in this Current Report on Form 8-K.





On
November 12, 2007, we entered into a Stock for Stock Equivalent Exchange
Agreement and Plan (the “Exchange Agreement”) with Taiyuan Rongan Business
Trading Company, Limited, a company incorporated under the laws of the Peoples
Republic of China (“TRBT”) and each of the equity owners of TRBT (the “TRBT
Shareholders”).  The closing of the transaction took place on May 7,
2008 (the “Closing Date”) and resulted in the acquisition of TRBT (the
“Acquisition”).  Pursuant to the terms of the Exchange Agreement, we
acquired eighty percent (80%) of the outstanding capital contributions in TRBT
(the “Interests”) from TRBT and the TRBT Shareholders.  As
consideration for the interests, we issued and transferred an aggregate of
31,500,000 shares, or 90% of the Company’s common stock.





Our
previous business was marketing and distributing Teeka Tan(R) Suncare Products,
a broad line of high quality, value-priced sun care products. We also
distributed the Safe Sea Jellyfish Sting Protective Lotion under a licensing
agreement with its manufacturer. We sold these products directly to resorts,
hotels and retailers with beach locations in south Florida, the Bahamas,
Dominican Republic, Alabama, New Hampshire, Rhode Island, Connecticut, New York,
North Carolina, South Carolina, Maine, Maryland and New Jersey.  Our
customers are primarily beach front stores and hotels with high volume tourist
traffic. We market our products through the use of our in house sales
representative as well as independent distributors.





In
September 2007 we announced that we had had signed a letter of intent to acquire
the Taiyuan Rongan Business Trading Company ("Taiyuan Rongan"), located in
Taiyuan, Shanxi Province, China, in a stock for stock exchange. Taiyuan Rongan
operates six shopping malls in the city of Taiyuan, China, of which it has 76%
ownership. On November 12, 2007 we entered into a Stock for Stock Equivalent
Exchange Agreement and Plan with Taiyuan Rongan and all of its current capital
contributors (the "Taiyuan Rongan Shareholders") pursuant to which at closing
the Taiyuan Rongan Shareholders will assign 80% of the 100% of capital
contributions in Taiyuan Rongan to our company in exchange for an aggregate of
31,500,000 shares of our common stock and common stock purchase warrants to
purchase an aggregate of 1,400,000 shares of our common stock at an exercise
price of $0.50 per share, both giving effect to the reverse stock split
described below.  The Share Exchange with Taiyuan Rongan closed on May
7, 2008.





BUSINESS
DEVELOPMENT OF TRBT




Overview




TRBT is a
company formed under the laws of the People’s Republic of China.  TRBT
acquired all the capital contributions of Taiyuan Clothing Group Company Limited
which has a 76.1% ownership interest in six shopping malls located in the
Chaoyang Street area in the city of Taiyuan, Shanxi Province,
China.




Business





TRBT is a
real estate developer based in Taiyuan, Shanxi, China that owns and manages
commercial space valued at more than US$60 million.  TRBT is engaged
in the business of leasing units in shopping malls to commercial tenants for
retail, wholesale and distribution of clothes, shoes, cosmetics, beddings and
other consumer products.





Our
Business





TRBT
operates six (6) shopping malls all located in the Chaoyang Street
area in the city of Taiyuan, Shanxi Province, China.







17




Principal
Factors Affecting our Financial Performance





We
believe that the following factors affect our financial
performance:




▪      Ability
to successfully acquire new shopping malls and increase foot traffic to these
locations;


▪      Continue
to attract consumers to our shopping malls; and


▪      Attract
profitable retailers to lease space in our shopping malls; and


▪      Continue
to keep a low debt to asset ratio.





In
addition, the following “global” factor will have an affect on our financial
performance:




▪      Growth
of the Economy in China





China’s
economy has experience significant growth over the past few years and Chinese
consumers have been continuing to spend money at a record breaking pace with no
signs of a slowdown and TRBT expects this trend to continue.





Results
of Operations





The
following tables set forth key components of our results of operations for the
periods indicated, in dollars, and key components of our revenue for the period
indicated, in dollars.




18




CHINA
      GROWTH DEVELOPMENT, INC. (f/k/a Teeka Tan Products, Inc.)CONSOLIDATED
      STATEMENTS OF OPERATIONSThree
      Months Ended June 302008
              
              
              2007NET
      REVENUENet
      revenue
              
              $
              3,738,624
              
              
              $
              3,459,975Cost
      of revenue
              
              
              36,361
              
              
              
              -Gross
      Profit
              
              
              3,702,263
              
              
              
              3,459,975General,
      selling and administrative expenses
              
              
              2,548,397
              
              
              
              1,708,276Operating
      income
              
              
              1,153,866
              
              
              
              1,751,699Non-operating
      income (expenses)Interest
      income
              
              
              1,494
              
              
              
              -Interest
      expense
              
              
              (72,679)
              
              
              
              (221,931)Other
      expense
              
              
              (80,982)
              
              
              
              -Total
      non-operating expenses
              
              
              (152,167)
              
              
              
              (221,931)Income
      before provision for income tax
              
              
              1,001,699
              
              
              
              1,529,768Provision
      for income tax
              
              
              22,534
              
              
              
              17,898Net
      income before minority interest
              
              
              979,165
              
              
              
              1,511,870Minority
      interest
              
              
              568,817
              
              
              
              357,886Net
      income
              
              $
              410,348
              
              
              $
              1,153,983




Net Revenue:
  Net
revenue increased by US$278,649 from US$3,459,975 for the three months ended
June 30, 2007 to US$3,738,624 for the three months ended June 30,
2008.
 
 Operating
expenses:
 
 Operating
expenses increased by US$840,121 from US$1,708,276 for the three months ended
June 30, 2007 to US$2,548,397 for the three months ended June 30,
2008.
  Income from
operations:
 
 Income
from operations decreased by US$597,833 from US$1,751,699 for the three months
ended June 30, 2007 to US$1,153,866 for the three months ended June 30,
2008.
 
 Net
Income Before Income Taxes:
 
 Net
Income before Income Taxes was US$1,511,870 for the three months ended June 30,
2007 and US$979,165 for the three months ended June 30,
2008.
  Net
Income:
 
 Net
income was US$1,153,983 for the three months ended June 30, 2007, compared to
US$410,348 for the three months ended June 30, 2008.




19






LIQUIDITY
AND CAPITAL RESOURCES





The
Company currently generates its cash flow through operations which it believes
will be sufficient to sustain current level operations for at least the next
twelve months.  In 2008, we intend to continue to work to expand our
presence in the commercial real estate market, including the acquisition of
another shopping mall.





To the
extent we are successful in growing our business, identifying potential
acquisition targets and negotiating the terms of such acquisition, and the
purchase price includes a cash component, we plan to use our working capital and
the proceeds of any financing to finance such acquisition costs.  Our
opinion concerning our liquidity is based on current information. If this
information proves to be inaccurate, or if circumstances change, we may not be
able to meet our liquidity needs.





2008
– 2009 Outlook





Over the
course of the next few years, we intend to grow and expand our commercial real
estate business.  We expect to acquire an additional 3 shopping
centers within the next two years.  These acquisitions will be
financed either through revenues of the Company or by financings and sales of
the Company’s stock or other securities.  In addition, TRBT expects to
complete the acquisition of development rights to 3,000 square metric units of
prime commercial land.




CRITICAL
ACCOUNTING POLICIES





We have
identified the policies outlined below as critical to our business operations
and an understanding of our results of operations. The list is not intended to
be a comprehensive list of all of our accounting policies. In many cases, the
accounting treatment of a particular transaction is specifically dictated by
accounting principles generally accepted in the United States, with no need for
management's judgment in their application. The impact and any associated risks
related to these policies on our business operations is discussed throughout
Management's Discussion and Analysis or Plan of Operations where such policies
affect our reported and expected financial results. For a detailed discussion on
the application of these and other accounting policies, see the Notes to the
Consolidated Financial Statements appearing elsewhere in this annual report.
Note that our preparation of the financial statements requires us to make
estimates and assumptions that affect the reported amount of assets and
liabilities, disclosure of contingent assets and liabilities at the date of our
financial statements, and the reported amounts of revenue and expenses during
the reporting period. There can be no assurance that actual results will not
differ from those estimates.





Revenue
Recognition





Revenue
is recognized on sales of products when the customer receives title to the
goods, generally upon delivery. Revenue is recorded on a gross basis, since we
are responsible for fulfillment, including the acceptability of the products and
services ordered by the customer. In the event we place any merchandise on
consignment, the related sales from such merchandise will be recorded when such
merchandise is sold by the retailer.





Shipping
and Handling Costs





Amounts
billed to customers in sales transactions related to shipping and handling
represent revenues earned for the goods provided and are included in sales.
Costs of shipping and handling are included in the cost of goods
sold.





Provision
for Slow Moving and Obsolete Inventory





We write
down our inventory for estimated unmarketable inventory or obsolescence equal to
the difference between the cost of inventory and the estimated market value
based on assumptions about future demand and market conditions. If actual market
conditions are less favorable than those projected by management, additional
inventory write-downs may be required.





Accounts
Receivable; Allowance for Doubtful Accounts





We
maintain allowances for doubtful accounts for estimated losses resulting from
the inability of our customers to make required payments. If the financial
condition of customers were to deteriorate, resulting in an impairment of their
ability to make payments, additional allowances may be required.






20




RECENT
ACCOUNTING PRONOUNCEMENTS





In
September 2006, the FASB issued SFAS No. 157, "Fair Value Measurements". The
objective of SFAS 157 is to increase consistency and comparability in fair value
measurements and to expand disclosures about fair value measurements. SFAS 157
defines fair value, establishes a framework for measuring fair value in
generally accepted accounting principles, and expands disclosures about fair
value measurements. SFAS 157 applies under other accounting pronouncements that
require or permit fair value measurements and does not require any new fair
value measurements. The provisions of SFAS No. 157 are effective for fair value
measurements made in fiscal years beginning after November 15, 2007. The
adoption of this statement did not have a material effect on our financial
position or results of operations.





In
February 2007, the FASB issued SFAS No. 159, "The Fair Value Option for
Financial Assets and Financial Liabilities - Including an Amendment of FASB
Statement No. 115". This statement permits entities to choose to measure many
financial instruments and certain other items at fair value. Most of the
provisions of SFAS No. 159 apply only to entities that elect the fair value
option. However, the amendment to SFAS No. 115 "Accounting for Certain
Investments in Debt and Equity Securities" applies to all entities with
available-for-sale and trading securities. SFAS No. 159 is effective as of the
beginning of an entity's first fiscal year that begins after November 15,
2007.  Early adoption is permitted as of the beginning of a fiscal
year that begins on or before November 15, 2007, provided the entity also elects
to apply the provision of SFAS No. 157, "Fair Value Measurements". The adoption
of this statement did not have a material effect on our financial
statements.





In
December 2007, FASB issued SFAS No. 160, "Noncontrolling Interests in
Consolidated Financial Statements - an amendment of ARB No. 51". This statement
improves the relevance, comparability, and transparency of the financial
information that a reporting entity provides in its consolidated financial
statements by establishing accounting and reporting standards that require; the
ownership interests in subsidiaries held by parties other than the parent and
the amount of consolidated net income attributable to the parent and to the
noncontrolling interest be clearly identified and presented on the face of the
consolidated statement of income, changes in a parent's ownership interest while
the parent retains its controlling financial interest in its subsidiary be
accounted for consistently, when a subsidiary is deconsolidated, any retained
noncontrolling equity investment in the former subsidiary be initially measured
at fair value, entities provide sufficient disclosures that clearly identify and
distinguish between the interests of the parent and the interests of the
noncontrolling owners. SFAS No. 160 affects those entities that have an
outstanding noncontrolling interest in one or more subsidiaries or that
deconsolidate a subsidiary. SFAS No. 160 is effective for fiscal years, and
interim periods within those fiscal years, beginning on or after December 15,
2008. Early adoption is prohibited. The adoption of this statement is not
expected to have a material effect on our financial statements.





OFF
BALANCE SHEET TRANSACTIONS





We are
not a party to any off balance sheet transactions.




Item
3. Quantitative and Qualitative Disclosures About Market Risk





The
Company is subject to certain market risks, including changes in interest rates
and currency exchange rates.  The Company does not undertake any specific
actions to limit those exposures.





Item
4T.  Controls and Procedures





Pursuant
to Rule 13a-15(b) under the Securities Exchange Act of 1934 (“Exchange Act”),
the Company carried out an evaluation, with the participation of the Company’s
management, including the Company’s Chief Executive Officer (“CEO”) and Chief
Accounting Officer (“CAO”) (the Company’s principal financial and accounting
officer), of the effectiveness of the Company’s disclosure controls and
procedures (as defined under Rule 13a-15(e) und er the Exchange Act) as of the
end of the period covered by this report. Based upon that evaluation, the
Company’s CEO and CAO concluded that the Company’s disclosure controls and
procedures are effective to ensure that information required to be disclosed
by the Company in the reports that the Company files or submits under the
Exchange Act, is recorded, processed, summarized and reported, within the time
periods specified in the SEC’s rules and forms, and that such information is
accumulated and communicated to the Company’s management, including the
Company’s CEO and CAO, as appropriate, to allow timely decisions regarding
required disclosure.






21





Management’s Report on
Internal Controls over Financial Reporting





Internal
control over financial reporting is a process to provide reasonable assurance
regarding the reliability of consolidated financial reporting and the
preparation of financial statements for external purposes in accordance with
U.S. generally accepted accounting principles.  There has been no change in
the Company’s internal control over financial reporting during the quarter ended
June 30, 2008 that has materially affected, or is reasonably likely to
materially affect, the Company’s internal control over financial
reporting.





The
Company’s management, including the Company’s CEO and CAO, does not expect that
the Company’s disclosure controls and procedures or the Company’s internal
controls will prevent all errors and all fraud. A control system, no matter how
well conceived and operated, can provide only reasonable, not absolute,
assurance that the objectives of the control system are met. Further, the design
of a control system must reflect the fact that there are resource constraints,
and the benefits of controls must be considered relative to their costs.
Because of the inherent limitations in all control systems, no evaluation of the
controls can provide absolute assurance that all control issues and instances of
fraud, if any, within the Company have been detected.





Management
conducted an evaluation of the effectiveness of our internal control over
financial reporting based on the framework in Internal Control – Integrated
Framework issued by the Committee of Sponsoring Organizations of the
Treadway Commission. Based on this evaluation, management concluded that the
company’s internal control over financial reporting was effective as of June 30,
2008.





This
quarterly report does not include an attestation report of the Company's
registered public accounting firm regarding internal control over financial
reporting. Management's report was not subject to attestation by the Company's
registered public accounting firm pursuant to temporary rules of the Securities
and Exchange Commission that permit the Company to provide only management's
report in this quarterly report.








22




PART
II - OTHER INFORMATION




Item
1. Legal Proceedings.




Currently
we are not aware of any litigation pending or threatened by or against the
Company.




Item
1A. Risk Factors.




None.





Item
2. Unregistered Sales of Equity Securities and Use of Proceeds




None.





Item
3. Defaults Upon Senior Securities.




None.




Item
4. Submission of Matters to a Vote of Security Holders.




None.




Item
5. Other Information.




None.




Item
6. Exhibits and Reports of Form 8-K.




(a)           Exhibits




31.1
Certifications pursuant to Section 302 of Sarbanes Oxley Act of
2002




32.1
Certifications pursuant to Section 906 of Sarbanes Oxley Act of
2002




(b)           Reports
of Form 8-K




None.








23












SIGNATURES




Pursuant
to the requirements of the Securities Exchange Act of 1934, as amended, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.




CHINA
      GROWTH DEVELOPMENT, INC.Date:
      August 20, 2008
            By:
            /s/ Sam
      LiuChief
      Executive OfficerChief
      Financial Officer









24