SECURITIES AND EXCHANGE
COMMISSION
WASHINGTON, D.C. 20549

Form 10 - Q

[X]	QUATERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
    EXCHANGE ACT OF 1934

For the quaterly period ended :  March 31, 2000


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

For the transition period from       to


Commission File number 0-22372

GRAND TOYS INTERNATIONAL, INC

(Exact name of Issuer as specified in its charter)

	Nevada				                        		          87-0454155
(State or  other jurisdiction of			   (I.R.S. Employer Identification No.)
incorporation or organization)

1710 Route Transcanadienne, Dorval, Quebec, Canada, H9P 1H7
(Address of principal executive offices)

(514) 685-2180
(Issuer's telephone number)

(Former name, former address and former fiscal year,
if changed since last report)

Indicate by check mark whether the Issuer (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act during the
preceding 12 months (or for such shorter period that the registrant was
required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days.
Yes X  No

Indicate the number of shares outstanding of each of the Issuer's classes
common equity as of May 5, 2000: 3,184,906


GRAND TOYS INTERNATIONAL, INC.
Index to Quaterly Report on Form 10 - Q
Filed with the Securities and Exchange Commission
Period ended March 31, 2000


ITEMS IN FORM 10 - Q
							                                                            Page

PART I - Financial Information

Item 1. Consolidated Financial Statements:

Consolidated Balance Sheets
   at March 31, 2000 and December 31, 1999                           4-5
Consolidated Statements of Operations
   For The Three Month Period
   Ended March 31, 2000 and 1999                                       6
Consolidated Satements of Stockholders' Equity
   and Comprehensive Income                                            7
Consolidated Statements of Cash Flows
   For The Three Month Period
   Ended March 31, 2000 and 1999                                       8
Notes to Consolidated Financial Statements                           9-18

Item 2.  Management's Discussion and Analysis of
         Financial Condition and Results of Operations               19-22
Item 3.  Quantitative and Qualitative Disclosures About
         Market Risks                                                  23

PART II - Other Information

Item 1.  Legal proceedings                                             23
Item 2.  Changes in Securities and Use of Proceeds                     23
Item 3.  Defaults Upon Senior Securities                               23
Item 4.  Submission of Matters to a Vote of Security Holders           24
Item 5.  Other Information                                             24
Item 6.  Exhibits and Reports on Form 8-K                              24


Signatures                                                            25-26




GRAND TOYS INTERNATIONAL, INC.

Part I. - Financial Information

Item 1. Financial Statements

Consolidated Balance Sheets


<TABLE>
                                                      March 31,   December 31,
                                                         		2000          	1999
                                                    (Unaudited)

Assets
<S>                                                        <C>            <C>
Current assets:
   Cash                                               $ 1,372,367  $         -
   Accounts receivable (net of allowance for
   doubtful accounts; 2000 - $93,501;
   1999 - $90,805)(note 2)                              4,120,191    8,083,004
   Income taxes recoverable                               535,702            -
   Due from affiliated companies	                          45,408       36,801
   Inventory                                            4,760,917    6,065,564
   Prepaid expenses	                                      973,882      940,435
   Total current assets                                11,808,467  	15,125,804

Deferred financing charges                                428,836      425,434
Deferred income tax                                       684,996      684,996
Equipment and leasehold improvements, net (note 3)       	558,483      536,157
Intangibles (net of amortization;2000-$30,870;
1999-$123,480)(note 4)                                  2,315,256    2,346,126



Total assets	                                      	 $ 15,796,038 $ 19,118,517

</TABLE>



GRAND TOYS INTERNATIONAL, INC.

<TABLE>
                                                 March 31,     December 31,
                                                      2000             1999
                                               (Unaudited)

<S>                                                      <C>            <C>
Liabilities and Stockholders' Equity
Current liabilities:
   Bank indebtedness (note 5)                      $ 	        -    $   429,526
   Trade accounts payable                           	   855,724      2,186,525
   Other accounts payable and accrued liabilities	      543,751        835,630
   Royalties payable	                                    23,509          2,286
   Income taxes payable	                                296,887        716,223
   Current portion of long term debt                    402,777        166,666
   Total current liabilities                          2,122,648     	4,336,856

Long term debt (note 6)                               1,500,000      1,777,778
Minority interest                                          	100           	100
Preferred stock (note 7)                                750,000      1,000,000

Stockholders' equity:
  Capital stock (note 8)                                  	3,185         3,135
  Additional paid-in capital	                         19,564,627    19,314,677
  Deficit                                            	(7,561,297)   (6,725,703)
Accumulated other comprehensive income -
cumulative currency translation adjustment            	 (583,225)     (588,326)
                                                    	 11,423,290    12,003,783

Commitments and contingencies (notes 12 and 13)
Subsequent events (note 15)

Total liabilities and stockholders' equity	         $ 15,796,038  $ 19,118,517
</TABLE>

See accompanying notes to consolidated financial statements.


GRAND TOYS INTERNATIONAL, INC.

Consolidated Statements of Operations (Unaudited)

<TABLE>
                                          For the three months ended March 31,
                                                      2000          	1999
<S>                                                    <C>             <C>

Net sales                                         $ 3,491,867    $ 8,626,916

Cost of goods sold	                                 3,013,320      5,990,128

Gross profit                        	                 478,547      2,636,787

Operating expenses:
 Selling, general and administrative	               1,588,599       1,728,390
 Foreign exchange loss (gain)          	               18,209        (137,041)
 Interest on long term debt                            59,966               -
 Interest                               	               1,859         127,679
 Bad debt expense                       	              28,069          37,902
 Depreciation and amortization                        143,389          67,990

                                                 		 1,840,091       1,824,920

(Loss) earnings before income taxes                (1,361,544)        811,867

Income tax recovy (expense)                           538,450       (477,850)

Net (loss) earnings                  	             $ (823,094)     $ 334,017

(Loss) earnings per share
 (note 1 (j))
  Basic	                                               $ (0.26)       $ 0.21
  Diluted                                	              	(0.26)         0.21

</TABLE>

See accompanying notes to consolidated financial statements.

GRAND TOYS INTERNATIONAL, INC.
Consolidated Statements of Stockholders' Equity and
Comprehensive Income  (Unaudited)


<TABLE>
                                                                         <C>
					                             <C>         <C>          <C>       Accumulated
		                                        Additional                       Other
                               	Capital      Paid-In               Comprehensive
                                  Stock      Capital       Deficit   	   Income 	     Total
<S>                               <C>      <C>            <C>             <C>         <C>
January 1, 2000               $ 3,135 	$ 19,314,677  $ (6,725,703)  $(588,326) $ 12,003,783

Net loss for the period             -             -      (823,094)          -      (823,094)

Foreign currency adjustment        	-            	-             -       5,101         5,101
Total comprehensive income						    -             -             -           -      (817,993)

Share conversion                   50        249,950            -           -        250,000

Dividends                           -              -      (12,500)          -        (12,500)

March 31, 2000                $ 3,185    $19,564,627  $ (7,561,297) $ (583,225)  $11,423,290

</TABLE>

See accompanying notes to consolidated financial statements.


GRAND TOYS INTERNATIONAL, INC.

Consolidated Statements of Cash Flows (Unaudited)


<TABLE>
                                               <C>             <C>
                                             For the three months
                                                 ending March 31,
                                            		2000              1999
<S>
Cash flows from operating activities:
 Net (loss) earnings	                   $ (823,094)        $ 334,017
 Items not affecting cash:
   Depreciation and amortization           143,389            67,990
Changes in operating working capital
items, (note 11)                         2,603,984        (2,080,748)
Net cash provided by (used for)
operating activities	                    1,924,279        (1,678,736)

Cash flows from financing activities:
(Decrease) increase in bank
indebtedness                              (438,328)       	1,546,123
Decrease in long term debt                 (41,667)                -
Increase in deferred financing charges       1,319                 -
Other	                                       6,456            64,036
Net cash (used for) provided by
financing activities                      (472,220)         	1,610,159

Cash flows from investing activities:
Additions to equipment
and leasehold improvements                 (67,192)         	 (51,981)
Acquisition of assets                            -            120,558
Dividends paid                            	(12,500)                 -
Net cash (used for) provided by
investing activities	                      (79,692)             68,577

Net change in cash, being cash at
at end of period                       $ 1,372,367          $     	-


Supplementary disclosure of cash flow information

Cash paid during the year for:
Interest	                                   $ 61,825           $ 127,679
Income taxes                             	   428,577                   -

</TABLE>


See accompanying notes to consolidated financial statements.


GRAND TOYS INTERNATIONAL, INC.

Notes to Consolidated Financial Statements


Grand Toys International, Inc., a publicly held company, is organized under
the laws of the State of Nevada.  Its principal business activity, through
its wholly-owned Canadian and United States operating subsidiaries, is the
distribution of toys and related items.

1.	Significant accounting policies:

(a) Financial statement presentation:

The accompanying consolidated financial statements are not audited for the
mentioned period but include all adjustments (consisting of only normal
recurring accruals) which management considers necessary for the fair
representation of results at March 31, 2000.

Moreover, these financial statements do not purport to contain complete
disclosures in conformity with generally accepted accounting principles
and should be read in conjunction with the Company's audited financial
statements at and for the fiscal year ended December 31, 1999 contained
in the Company's Annual Report on Form 10-K.

(b) Principles of consolidation:

These consolidated financial statements, presented in U.S. dollars and in
accordance with accounting principles generally accepted in the United States,
include the accounts of Grand Toys International, Inc. and its subsidiaries
(the "Company"). All significant intercompany balances and transactions have
been eliminated.


(c) Inventory:

Inventory is valued at the lower of cost, determined by the first in, first
out method, and net realizable value.  The only significant class of
inventory is finished goods.


(d) Equipment and leasehold improvements:

Equipment and leasehold improvements are stated at cost less accumulated
depreciation.  Depreciation methods and annual rates adopted by the Company
are as follows:

<TABLE>
<S>                                <C>                            <C>
Asset	                             Method	                        Rate

Computer equipment	                Declining balance             	30%
Machinery and equipment	           Declining balance             	20%
Furniture and fixtures	            Declining balance	             20%
Trucks and automobiles            	Declining balance             	30%
Telephone equipment               	Declining balance             	30%
Leasehold improvements	                Straight-line         	Term of
                                                     		lease plus one
                                                       		renewal term
</TABLE>

GRAND TOYS INTERNATIONAL, INC.

Notes to Consolidated Financial Statements

(e) Deferred financing charges:

Deferred financing charges represent the costs incurred relating to the
negotiation of the credit facility.  Deferred financing charges are
amortized over 36 months, the term of the financing.


(f) Intangibles:

Goodwill represents the excess of the purchase price over the fair value of
the net identifiable assets acquired.  Goodwill is amortized using the
straight-line method over a twenty year period.  The net book value of
goodwill would be written down if the value were permanently impaired.  The
Company assesses impairment by determining whether the unamortized intangible
balances can be recovered through undiscounted future operating cash flows
of the acquired assets over their remaining lives, and the write down would be
to fair value.


(g) Impairment of long-lived Assets and long-lived Assets to be Disposed of:

The Company accounts for long-lived assets in accordance with the provisions
of SFAS No. 121, "Accounting for the Impairment of Long-Lived Assets and for
Long-Lived Assets to Be Disposed Of".  This Statement requires that long-lived
assets and certain identifiable intangibles be reviewed for impairment whenever
events or changes in circumstances indicate that the carrying amount of an asset
may not be recoverable.  Recoverability of assets to be held and used is
measured by a comparison of the carrying amount of an asset to future net cash
flows expected to be generated by the asset.  If such assets are considered to
be impaired, the impairment to be recognized is measured by the amount by
which the carrying amount of the assets exceeds the fair value of the assets.
Assets to be disposed of are reported at the lower of the carrying amount or
fair value less costs to sell.


(h) Revenue recognition:

Sales are recognized at the time of shipment of products.  The Company estimates
liabilities for returns and allowances at the time of shipment.  In addition,
provisions for customer allowances are recorded when the related revenue is
recognized.


(i) Foreign currency translation:

(i)  Grand Toys Ltd. and Grand Concepts Inc., wholly-owned Canadian
     subsidiaries, use the Canadian dollar as their functional currency and
     translate their assets and liabilities into US dollars at the exchange
     rates prevailing at the balance sheet date and sales, expenses and cash
     flows translated at the average exchange rate for the year.
     The resulting currency translation adjustments are accumulated and
     reported in other comprehensive income.

(ii) Other monetary assets and liabilities denominated in foreign currencies
     are translated at the exchange rates prevailing at the balance sheet
     date.  Revenues and expenses denominated in foreign currencies are
     translated at the rates of exchange prevailing at the transaction dates.
     All exchange gains and losses are included in income.


GRAND TOYS INTERNATIONAL, INC.

Notes to Consolidated Financial Statements


(j) Earnings (loss) per share:

(i)  Basic earnings (loss) per share is determined by dividing the
     weighted-average number of common shares outstanding during the period
     into net earnings (loss).

(ii) Diluted earnings (loss) per share gives effect to all potentially
     dilutive common shares that existed at March 31, 2000.

(k) Stock option plan:

The Company accounts for its stock option plan in accordance with the
provisions of Accounting Principles Board ("APB") Opinion No. 25,
Accounting for Stock Issued to Employees.  As such, compensation expense
is recorded on the date of grant only if the current market price of the
underlying stock exceeds the exercise price.  FASB Statement No. 123, which
became effective in 1996, allows entities to continue to apply the
provisions of APB Opinion No. 25 and requires pro-forma net earnings and
pro-forma earnings per share disclosures for employee stock option grants
made in 1995 and future years as if the fair-value-based method defined
in FASB Statement No. 123 had been applied.  This disclosure is included
in the notes to these statements.

(l) Advertising and promotion:

All costs associated with advertising and promoting products are
expensed in the period incurred.

(m) 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.

(n) Comprehensive income:

On January 1, 1998, the Company adopted SFAS No. 130, Reporting
Comprehensive Income.  SFAS No. 130 establishes standards for reporting
and presentation of comprehensive income and its components in a full set
of financial statements. Comprehensive income consists of net income and
cumulative currency translation adjustments and is presented in the
consolidated statements of stockholders' equity and comprehensive income.
The Statement requires only additional disclosures in the consolidated
financial statements; it does not affect the Company's financial position
or results of operations.  Prior year financial statements have been
reclassified to conform to the requirements of SFAS No. 130.

GRAND TOYS INTERNATIONAL, INC.

Notes to Consolidated Financial Statements, Continued

2.  Accounts receivable:

<TABLE>

                                March 31, 2000             December 31, 1999
<S>                                   <C>                         <C>
Trade receivables                $ 3,194 942               $ 7,166,705

Other                              1,018,750                 1,007,104

Allowance for Doubtful Accounts      (93,501)                  (90,805)

Total Accounts Receivable        $ 4,120,191               $ 8,083,004
</TABLE>

3.	Equipment and leasehold improvements:

<TABLE>
                                March 31,                         December 31,
                                  			2000                   	             1999
                                      		Accumulated             		          Accumulated
                       		Cost          	depreciat             	Cost	       depreciation
<S>                     <C>              <C>                    <C>                <C>
Computer equipment	    $ 1,296,735   $ 889,493            $ 1,286,253          $ 857,726
Machinery and equipment 	  481,341     437,413                458,091           	430,434
Furniture and fixtures	    498,581     456,122                480,775        	   454,974
Trucks and automobiles	     84,277      82,733                 84,335       	     82,665
Telephone equipment	        46,100      37,259                 40,339             36,819
Leasehold improvements     382,409     327,940               	372,755            323,773

                     		$ 2,789,443 $ 2,230,960            $ 2,722,548  	     $ 2,186,391

Net book value	              $ 558,483                               $ 536,157

</TABLE>

4. Acquisition:

On January 1, 1999, the Company acquired all of the assets of Ark Foudation
LLC,(renamed Ark Creations Inc.) for proceeds of $ 2,500,000.

The Company accounted for the acquisition under the purchase method of
accounting and allocated the purchase price as follows:


Net assets                    $ 120,557
Patents                       1,234,803
Goodwill                      1,234,803
                            $ 2,590,163

GRAND TOYS INTERNATIONAL, INC.

Notes to Consolidated Financial Statements


The acquisition of the above assets was financed as follows:

Long-term debt (note 6)  $ 1,500,000
Series A 5% Cumulative
Convertible Redeemable
Preferred Stock (note 7)   1,000,000
Direct acquisition costs      90,163
                         $ 2,590,163

Net income for Ark Creations Inc., has been included in the statement of
operations from January 1, 1999.  Results of operations for 1998,  on a
proforma basis have not been presented because the impact would not be
significant.

In the statement of cash flows, the financing of the assets and the recognition
of the intangibles have not been included as there is no cash impact.


5.	Bank indebtedness:

The Company has a secured line of credit of $17,500,000 and can
draw down working capital advances and letters of credit in amounts determined
by percentages of its accounts receivable and inventory.  The working capital
advances are secured by all of the assets of the Company.  The effective
interest rate at March 31, 2000 on the Canadian denominated line was 7.75%
(7.50% at December 31, 1999),which represents prime plus 1 1/4% for both
years.  As at March 31, 2000, the unused portion of the credit facility is
approximately $ 17,500,000. Standby fees represent 1/4 % of the unused line
of credit.

6. Long term debt:

The Company has long-term indebtedness in the form of an interest
bearing subordinated promissory note in the aggregate principal amount of
$ 1,500,000, see note 4.  Interest is payable quarterly, commencing
April 1, 1999 at a rate of 5.76% per annum until June 1, 1999, 9.76% per
annum thereafter until the first principal installment of $ 500,000 is paid,
and 5.76% per annum thereafter to maturity.  The note is secured by a pledge
of 375,000 shares of the Company's common stock. A principal installment of
$500,000 shall be paid upon the achievement of certain sales targets, with a
second installment of $ 500,000 due six months thereafter, and a final
installment of $ 500,000 due three months after the second installment.

The Company has an unsecured term loan of $ 402,777 as at March 31, 2000.
Interest is payable monthly, commencing September 1, 1999,  at a rate of 8.75%.
Capital monthly repayments are based on a 36 month term, and the term loan
is renewable August 2002.


GRAND TOYS INTERNATIONAL, INC.

Notes to Consolidated Financial Statements

7. Preferred Stock:

Series A Cumulative Convertible Redeemable Preferred Stock

In connection with the acquisition of the net assets Ark Foundation LLC, the
Company created a class of 200,000 shares of non-voting Series A Convertible
Redeemable Preferred Stock ("Series A Stock") with a stated value of $ 5.00
per share.  The Series A Stock ranks senior to the common stock.  The Series
A Stock has a cumulative preferred quarterly dividend of 5% per annum of the
par value, payable in cash. The Series A Stock is effectively redeemable and
convertible at determinable prices on determinable dates. The Series A Stock
is convertible beginning on January 1, 2000 into shares of the Company's
common stock. If upon conversion, the market value of the common stock of
the Company is less than $5.00, the Company is obligated to make up the
discrepancy.

On January 1, 2000, 50,000 of Series A Stock were converted to common stock.


8.	Capital stock:

(a) Authorized capital:

    50,000,000, $0.001 par value voting common shares;

    5,000,000, $0.001 par value preferred shares, issuable in series with such
    designation, rights and preferences as may be determined from time to
    time by  the Board of Directors.

(b) Issued and outstanding:

<TABLE>
                                                   March 31,      December 31,
                                                       	2000             	1999
<S>                                                     <C>                <C>
3,184,906 common shares, net of 375,000 shares
(note 6)(1999 - 3,134,906 common shares)
(note 1 (k))                                         $ 3,185          $ 3,135


(c) Share transactions:


-   August 1999
    1,491,794 options were exercised for total proceeds of $ 8,044,944,
    increasing capital stock by $ 1,492.

-   October 1999
    8,478 options and 57,000 warrants were exercised for total proceeds of
    $ 396,731 increasing capital stock by $65.

(d) Summary of common stock outstanding:


GRAND TOYS INTERNATIONAL, INC.

Notes to Consolidated Financial Statements

A summary of the number of common stock outstanding and share transactions
since January 1, 1999 is as follows:



</TABLE>
<TABLE>
<S>                                                   <C>
January 1, 1999          		                         1,577,634

Issued on exercise of stock options and warrants    1,557,272

Adjusted balance                                    3,134,906

Preferred share conversion                             50,000

March 31, 2000                              	       3,184,906

</TABLE>


9.	Stock options and warrants:

The Company has a stock option plan (the "Option Plan") which provides for the
issuance of up to 300,000 options to acquire common stock of the Company.
Stock options granted under the Option Plan may be Incentive Stock Options
under the requirements of the Internal Revenue Code, or may be Non-statutory
Stock Options which do not meet such requirements.  Options may be granted under
the Option Plan to, in the case of Incentive Stock Options, all employees
(including officers) of the Company, or, in the case of Non-statutory Stock
Options, all employees (including officers) or non-employee directors of the
Company.

Under each plan, the exercise price of each option equals the market price of
the Company's stock on the grant date and an option's maximum term is ten years.
The range of exercise prices for stock options and warrants outstanding at
March 31, 2000 is $2.75 to $21.90.


Details of the options and warrants, all of which are exercisable at year-end,
are as follows:

<TABLE>
                       <C>              <C>                 <C>              <C>
                                            						                           Weighted-
					                                                                           average
                                     	   	Other	                               exercise
                    	  Option	            Stock	                              price per
                        	Plan          	Options         Warrants     Total        share
<S>
January 1, 2000      	  5,400         	 175,500       		 55,000    	 235,900   	$ 6.43

Reclassified            2,000            (2,000)              -            -         -

Granted	                1,000                 -               -        1,000      2.75

March 31, 2000          8,400           173,500          55,000      236,900    $ 6.41
</TABLE>


GRAND TOYS INTERNATIONAL, INC.

Notes to Consolidated Financial Statements

10. Earnings per share:

<TABLE>

                                   		Income         	Shares        	Per share
	                               (numerator)	   (denominator)	          Amount
<S>                                <C>            <C>                 <C>
Period ended March 31, 2000

Basic EPS
 Earnings available to
 common stockholders             	$ (823,094)     3,184,906          $(0.26)

Diluted EPS
 Earnings available to
 common stockholders
 and assumed conversions            (823,094)      3,184,906          (0.26)

</TABLE>


Options to purchase 1,000 shares (1999 - 180,900) and no warrants to purchase
shares (1999 - 55,000) of the Company's common stock were not included
in the diluted earnings per share calculation as their effect is anti-dilutive.
The Series A Convertible Redeemable preferred stock was also not included as the
effect is anti-dilutive.

11.	 Changes in operating working capital items:

<TABLE>

                                For the three months ended March 31,
      	                                        	2000         	1999
<S>                                              <C>           <C>
Decrease in accounts receivable	           $ 3,978,484      $ 1,216,923
Increase in income taxes recoverable          (538,450)               -
(Increase) decrease in due from
affiliated company	                             (8,677)         206,680
Decrease (increase) in inventory	            1,307,479       (3,657,018)
Increase in prepaid expenses                  (107,154)        (636,679)
(Decrease) increase in trade
accounts payable                            (1,335,605)         999,411
Decrease in other accounts payable
and accrued liabilities                       (292,439)        (703,437)
Increase in royalties payable                   21,334            8,257
(Decrease) increase in income taxes payable 	 (420,988)         485,120

                                          	$ 2,603,984      $ (2,080,748)
</TABLE>

GRAND TOYS INTERNATIONAL, INC.

Notes to Consolidated Financial Statements

12. 	Commitments:

The Company has entered into long-term leases with minimum annual rental
payments approximately as follows:

<TABLE>
<S>                                              <C>
2000                                         $	341,000
2001	                                         	355,000
2002	                                         	293,000
2003	                                         	261,000
2004                                           215,000
Thereafter	                                   	 17,000

                                       				$	1,482,000
</TABLE>

Rent expense for the period ended March 31, 2000 and 1999 amounted to
approximately $69,770 and $86,145 respectively.


13.	Contingencies:

(a)	Lawsuits for alleged breach of contract has been filed against the Canadian
    subsidiary by two former sales representatives. In the opinion of
    management, these actions have no merit.  At this point in time it is
    difficult to ascertain or estimate the value of a settlement, if any.

    The Company has been named in a lawsuit by a lessor for recovery of amounts
    totaling in excess of $300,000.  There have been no recent developments
    and in the opinion of management it is difficult to ascertain the
    likelihood of an unfavorable outcome to the Company.

    A class action suit, as described in note 15, has been filed against the
    Company.  In the opinion of management it is difficult to ascertain the
    likelihood of an unfavorable outcome to the Company.

(b) The Company's Canadian subsidiary is also contigently liable for outstanding
    letters of credit or approximately $910,000 as at March 31, 2000.

14. Financial instruments:

(a)	Foreign currency risk management:

The Company enters into forward foreign exchange contracts to minimize its
foreign currency exposure on purchases.  The contracts oblige the Company to
buy US dollars in the future at predetermined exchange rates.  The contracts
are not used for trading purposes.  The Company's policy is to enter into
forward foreign exchange contracts on a portion of its purchases anticipated
in the next selling season.  Gains and losses on forward exchange contracts
are recorded in income and generally offset transaction gains or losses on
the foreign currency cash flows which they are intended to hedge.

GRAND TOYS INTERNATIONAL, INC.

Notes to Consolidated Financial Statements

At March 31, 2000 the Company had no contracts to purchase US dollars.

(b)	Fair values:

Fair value estimates are made as of a specific point in time, using available
information about the financial instruments.  These estimates are subjective in
nature and often cannot be determined with precision.

The fair value of the Company's accounts receivable, due from affiliated
companies, bank indebtedness, trade and other payables approximate their
carrying value due to the immediate or short-term maturity of these
financial instruments.  The fair market value of long term debt approximates
its amount carrying value.

(c)	Credit risk and economic dependence:

For the period ended March 31, 2000, approximately 88%
(December 31, 1999 - 64%) of the Company's sales were made to five unrelated
companies.  Three customers, representing approximately 67%
(December 1999 - 50%) of total sales, individually accounted for more than
2% (December 31, 1999 - 10%) of total sales.  The Company regularly monitors
its credit risk exposure to these and other customers and takes steps to
mitigate the risk of loss.

(d)	Interest rate risk:

The Company's principal exposure to interest rate risk is with respect to its
short-term financing which bears interest at floating rates.

15. Subsequent event:

    (a) The term loan of $402,777 was repaid in April 2000.

    (b) On or about April 7, 2000, an action againts the Company and certain
        of its current directors and a former director was filed in the
        United Stated District Court for the Southern District of New York
        by Robert VanDyke, purportedly representing himself and a class of
        similarly situated purchasers of the Company's common stock.  The
        class-action complaint seeks damages and rescission and alleges that
        the Company's August 4, 1999 press release announcing an exclusive
        license to manufacture and distribute products in Canada based upon
        the "Pokemon" TM video game and television series was misleading
        because the license had not yet been executed and, when ultimately
        executed three weeks later, was non-exclusive.  The complaint
        further alleges that this affected the market price of the Company's
        stock during the three week period.  The Company belives the suit
        is without merit and intends to vigorously contest it.


GRAND TOYS INTERNATIONAL, INC.


Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations

Forward looking statements.

This Form 10-Q contains forward-looking statements about events and
circumstances that have not yet occurred.  For example, statements including
terms such as the Company "expects" or "anticipates" are forward-looking
statements.  Investors should be aware that the Company's actual results
may differ materially from the Company's expressed expectations because of
risks and uncertainties about the future.  The Company will not necessarily
update the information in this Form 10-Q if and when any forward-looking
statement later turns out to be incaccurate.  Risks and uncertainties that
may affect the Company's future results and performance include, but are not
limited to, the following:  intense competition and pricing pressures in the
toy industry; the general consolidation in the toy industry; whether the
Company's general strategy with respect to the toy industry and the Company's
implementation of that strategy will correctly anticipate key trends in the
toy industry; the Company's ability to retain its product lines; the Company's
relationships with retailers and other issues with respect to the Company's
distribution channels.  Additional information about factors that could
affect future results and events is included elsewhere in this Form 10-Q,
in the Company's fiscal 1999 Form 10-K and in other reports filed with the
Securities and Exchange Commission.


Overview

Net sales consist of sales of products to customers after deduction
of customer cash discounts, freight and warehouse allowances,
volume rebate allowances, and returns of merchandise.  Sales are recorded
when the merchandise is shipped.

The cost of goods sold for products imported as finished goods
includes the cost of the product in the appropriate domestic currency, duty
and other taxes, and freight and brokerage charges.  Royalties to suppliers
not contingent upon the subsequent sales of the suppliers' products are
included in the price paid for such products.

Major components of selling, general and administrative expenses
include: payroll and fringe benefits; advertising expense, which
includes the cost of production of television commercials and the
cost of air time; advertising allowances paid to customers for
cooperative advertising programs; and royalty expense.  Royalties
include payments by Grand Canada to licensors of character
properties and to manufacturers of its toy products if such
payments are contingent upon subsequent sales of the products.
Royalties are usually a percentage of the price at which the product
is sold and are payable once a sale is made.

Accounts receivable are receivables net of an allowance for
doubtful accounts.  The allowance is adjusted periodically to reflect
the current status of receivables.  Management believes that current
reserves for doubtful accounts are adequate.  Sales of products to
retailers and distributors are on an irrevocable basis.  Consistent
with industry practices, Grand Canada may make exceptions to this
policy on a case-by-case negotiated basis.  Inventory is comprised
of finished goods at landed cost.

All amounts are in US Dollars ($) unless otherwise noted.

GRAND TOYS INTERNATIONAL, INC.

Results of Operations

The following table sets forth consolidated operations data as a
percentage of net sales for the periods indicated:

<TABLE>
                                                    For the Three
                                                Months Ended March 31,
                                             2000           1999
                                             %              %
<S>                                          <C>            <C>
Net sales                                    100.00         100.00
Cost of goods sold                            86.30          69.44
Gross profit                                  13.70          30.56

Operating expenses:
  Selling, general and administrative         45.49          20.03
  Foreign exchange loss (gain)                  .52         (1.59)
  Interest on long term debt                   1.71
  Interest                                      .06           1.48
  Bad debt expense                              .80            .44
  Depreciation and amortization                4.11            .79
Total operating expenses                      52.69          21.15

(Loss) earnings before income taxes          (38.99)          9.41

Net (loss) earnings                          (23.57)          3.87
</TABLE>

Comparison of the three months ended March 31, 2000 to the three months ended
March 31, 1999:

Net Loss:

Net loss was $823,094 for the first quarter of 2000 compared to a net earnings
of $334,017 for the same period last year.  The decrease of $1,157,111 in
earnings was mainly due to the decrease in sales and the reduced margins on
those sales during the period.

Net Sales:

Net sales decreased by $5,135,049 or by 59% over net sales during the first
quarter of 1999.  The decrease is due to the significant decrease in sales
of the Furby (Tiger Electronics).

Gross Profit:

Gross profit for the Company decreased by $2,158,240, or, as a percentage of
sales, gros profit decreased from 30.56% to 13.70%. The decrease in gross
profit percentage was due to the sales mix in the product line, primarly
due to the lower gross margins associated with the clearance of the Furby
product line and the discontinuance of other product lines.



GRAND TOYS INTERNATIONAL, INC.


Selling, General and Administrative Expenses:

The decrease in selling, general and administrative expenses of $139,791
compared to those of the first quarter of 1999 was mainly due to a decrease
in cooperative advertising expense.


Comparison of the three months ended March 31, 1999 to the three months
ended March 31, 1998

Net Earnings:

Net earnings were $334,017 for the first quarter of 1999 compared to a net
earnings of $220,866 for the same period last year.  The increase of $113,151
in net earnings was mainly due to the increase in sales during the period.


Net Sales:

Net sales increased by $4,038,405 or by 88% over net sales during the first
quarter of 1998.  The increase is due to the significant increases in the
sale of the product lines Furby (Tiger Electronics) and WCW Wrestlers
(Toy Biz Inc.).


Gross Profit:

Gross profit for the Company increased by $892,098, or as a percentage of
sales, gross profit decreased from 38.02% to 30.56%.  The decrease in gross
profit percentage was due to the sales mix in the product line, primarily
due to the lower gross margins associated with the Furby product line and
the discontinuance of other product lines.


Selling, General and Administrative Expenses:

The increase in selling, general and adminsitrative expenses of $443,782
compared to those of the first quarter of 1998 was mainly due to an increase
in cooperative advertising expense.  However, as as percentage of sales a
decrease of 7.96% was experienced.


Income Tax Expense:

As compared to the same period in 1998, the increase in income tax expense
was $345,108 due to higher earnings in the period.


Liquidity and Capital Resources

The Company generally finances its operations through borrowings
under the Company's Credit Agreement with its bank and by cash
flow from operations. The inflow of funds during the year due to options
and warrants being excercised has resulted in virtually all short-term
bank debt being eliminated by year end.

GRAND TOYS INTERNATIONAL, INC.

In August 1999, the Company entered into a three year banking
arrangement with a new lending institution.  Grand Toys has a
secured line of credit of $17,500,000 to enable it to meet its plans.
The Company may draw down working capital advances and letters of credit in
amounts determined by percentages of its accounts receivable and
inventory.  Working capital advances taken by the Company bear
interest at prime plus 1 1/4%.  The term of the loan is three years.

The Company received $8,441,675 during the year of 1999 as a result of
options and warrants being exercised.

Accounts receivable at March 31, 2000 were $4,120,191 compared to $8,083,004
at December 31, 1999. Inventory was $4,760,917 at March 31, 2000 compared to
$ 6,065,564 at December 31, 1999.  Due to the seasonality to the toy industry,
inventory levels will fluctuate according to customer demand.

Working capital decreased from $10,788,948 at December 31, 1999 to
$9,685,819 at March 31, 2000.  Net cash provided by operating activities was
$1,924,279 in 2000 compared to net cash used for operating activities of
$1,678,736 in 1999.  Cash for additions to equipment and leasehold
improvements  was $67,192 compared to $51,981 in 1999, as a result of
purchases relating to the acquisition of Ark Creations Inc.

Grand Canada's accounts receivable level is subject to significant seasonal
variations due to the seasonality of sales.  As a result, Grand Canada's
working capital requirements are greatest during its third and fourth
quarters.  In addition, to the extent accounts receivable, inventories and
guarantees and advance payments increase as a result of growth of Grand
Canada's  business, Grand Canada could require additional working capital to
fund its operations.  Sources of such funding include cash flow
from operations, drawings on the financing facilities, or sales of
additional equity or debt securities by the Company.

If the funds available under the Company's financing agreements,
together with its current cash and cash equivalents are not
sufficient to meet the Company's cash needs, the Company may
from time to time seek to raise capital from additional sources,
including the extension of its current lending facilities, project-
specific financing and additional public or private debt or equity
financing.  Management believes that the Company has sufficient
financing at the present time to meet its 2000 forecast.

Effects Of Inflation

The Company does not believe that inflation has had a significant
impact on its financial position or results of operations in the past
three years.

New Accounting Pronouncements

In June 1998, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting of Standards ("SFAS") No. 133, "Accounting
for Derivative Instruments and Hedging Activities".  This statement addresses
the accounting for derivative instruments, including forward foreign exchange
contracts.  This statement, as amended by SFAS No. 137, shall be effective for
the Company's financial statements for December 31, 2000.  The Company has
not yet determined the impact of this statement on its results of operations.

GRAND TOYS INTERNATIONAL, INC.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

The Company is exposed to certain market risks, which arise from transactions
entered into in the normal course of business.  The Company's primary exposures
are changes in interest rates with respect to its debt and foreign currency
exchange fluctuations.

INTEREST RATE RISK  The intrest payable on the Company's revolving
lines-of-credit are variable based on the prime rate, and therefore,
affected by changes in market interest rates.  The Company does not use
derivative financial instruments.

FOREIGN CURRENCY RISK  While the Company's product pruchases are transacted
in United Stated dollars, most transactions among the suppliers and
subcontractors are effected in HK dollars.  Accordingly, fluctuations in
Hong Kong monetary rates may have an impact on the Company's cost of goods.
Futhermore, appreciation of Chinese currency values relative to the Hong Kong
dollar could increase the cost to the Company of the products manufactured in
the People's Republic of China, and thereby have a negative impact on the
Company.  As well since the majority of the Company's sales are in Canadian
dollars, the Company is at risk with regards to the conversion of Canadian
dolalrs to US dollars to pay its suppliers.  Therefore, fluctuations in the
conversion rate may have an impact on the Company.  The Company may use
derivative financial instruments solely to hedge the effects of such
currency fluctuations.


Part II - Other Information

Item 1.  Legal Proceedings

On November 30, 1995, an involuntary petition under Chapter 7 of the United
States Bankruptcy Code was filed against Grand Group Inc., a U.S. subsidiary,
in the United States Bankruptcy Court for the Southern District of New York
(the "Bankruptcy Proceeding").  On January 4, 1996, the Court entered an order
for relief under Chapter 7 of the Untied States Bankruptcy Code and a trustee
was appointed to supervise the liquidation of Grand Group Inc.  To date, no
other proceedings have occured in connection with the Bankruptcy.

On or About April 7, 2000, an action against the Company and certain of its
current directors and a former director was filed in the United States
District Court for the Southern District of New York by Robert VanDyke,
purportedly representing himself and a class of similarly situated
purchasers of the Company's common stock.  The class-action complaint seeks
damages and rescission and alleges that the Company's August 4, 1999 press
release announcing an exclusive license to manufacture and distribute
products in Canada based upon the "Pokemon"TM video game and television
series was misleading because the license had not yet been executed and,
when ultimately executed three weeks later, was non-exclusive.  The
complaint further alleges that this affected the market price of the
Company's stock during the three week period.  The Company believes the
suit is without merit and intends to vigorously contest it.

Other than discussed above or in Note 13 to the Company's Consolidated
Financial Statements included elsewhere herein, the Company is not a party
to, nor is it aware of, any other pending litigation of a material nature.

Item 2.  Changes in Securities and Use of Proceeds

Refer to the Consolidated Financial Statements in Part I of the document.

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.  Reports on Form 8-K

No reports on Form 8-K were filed during the quarter ended March 31, 2000



GRAND TOYS INTERNATIONAL, INC.

Signatures

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


Dated:  May 12, 2000			GRAND TOYS INTERNATIONAL, INC.

By:  /s/ Stephen Altro
Stephen Altro
Chairman


By:  /s/ Ken Cieply
Ken Cieply
Executive Vice President,
Chief Financial Officer,
Secretary and Treasurer
(Principal Financial and Accounting Officer)


GRAND TOYS INTERNATIONAL, INC.


Signatures

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

Dated:  May 12, 2000      GRAND TOYS INTERNATIONAL, INC.

By: /s/ Steve Altro
Steve Altro
Chairman
(Principal Executive Officer)

Be: /s/ Ken Cieply
Ken Cieply
Executive Vice President,
Chief Financial Officer,
Secretary and Treasurer
(Principal Financial and Accounting Officer)