SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549





FORM
10-Q





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





For
the quarterly period ended June 30, 2010





OR





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





For
the transition period from ______ to __________





COMMISSION
FILE NUMBER: 333-128532





CHISEN ELECTRIC
CORPORATION


(Exact
name of registrant as specified in its charter)





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





Jingyi
Road, Changxing Economic Development Zone, Changxing, Zhejiang
Province,


The
People’s Republic of China


(Address
of principal executive offices)





(86)
572-6267666


(Registrant’s
Telephone Number, Including Area Code)





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





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





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





State the
number of shares outstanding of each of the issuer’s classes of common equity,
as of the latest practicable date:  As of August 13, 2010, the registrant
had 50,000,000 shares of common stock, par value $0.001 per share, issued and
outstanding.








TABLE OF CONTENTS





PART
      I FINANCIAL INFORMATION
              
              3ITEM
      1. FINANCIAL STATEMENTS
              
              3ITEM
      2. MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF
    OPERATION
              
              4ITEM
      3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
    RISK
              
              11ITEM
      4. CONTROLS AND PROCEDURES
              
              12PART
      II OTHER INFORMATION
              
              12ITEM
      1. LEGAL PROCEEDINGS
              
              12ITEM
      1A. RISK FACTORS
              
              12ITEM
      2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF
    PROCEEDS
              
              12ITEM
      3. DEFAULTS UPON SENIOR SECURITIES
              
              12ITEM
      4. SUBMISSION OF MATTERS TO A VOTE OF SECURITYHOLDERS
              
              12ITEM
      5. OTHER INFORMATION
              
              12ITEM
      6. EXHIBITS
              
              12SIGNATURES
              
              16EXHIBIT
      31.1EXHIBIT
      31.2EXHIBIT
      32.1EXHIBIT
      32.2




2


PART
I


FINANCIAL
INFORMATION




ITEM
1. FINANCIAL STATEMENTS





PageUnaudited
      Condensed Consolidated Statements of Operations and Other
      Comprehensive Income
                
                F-2Unaudited
      Condensed Consolidated Balance Sheets
                
                F-3 –
      F-4Unaudited
      Condensed Consolidated Statements of Changes in Stockholders’
      Equity
                
                F-5Unaudited
      Condensed Consolidated Statements of Cash Flows
                
                F-6 –
      F-7Notes
      to and Forming Part of Unaudited Condensed Consolidated Financial
      Statements
                
                F-8 –
      F-20




3


Unaudited
Condensed Consolidated Financial Statements
of
  Chisen
Electric Corporation
  For
the three months ended June 30, 2010
  
  Chisen
Electric Corporation
 
 Index
to Unaudited Condensed Consolidated Financial Statements
 For the
three months ended June 30, 2010
 
 PageUnaudited
      Condensed Consolidated Statements of Operations and Other Comprehensive
      Income
                
                F-2Unaudited
      Condensed Consolidated Balance Sheets
                
                F-3
      – F-4Unaudited
      Condensed Consolidated Statements of Changes in Stockholders’
      Equity
                
                F-5Unaudited
      Condensed Consolidated Statements of Cash Flows
                
                F-6 –
      F-7Notes
      to and Forming Part of Unaudited Condensed Consolidated Financial
      Statements
                
                F-8
      – F-20
  F-1
  Chisen
Electric Corporation
 
 Unaudited
Condensed Consolidated Statements of Operations and
 Other
Comprehensive Income
 For the
three months ended June 30, 2010 and 2009
 
 Three months ended June 30,2010
                              
                              
                              2009Note
                              
                              
                              US$’000
                              
                              
                              US$’000Operating
      revenues:Net sales to third
      parties
                              
                              
                              
                              
                              
                              50,429
                              
                              
                              
                              29,475Cost
      of sales
                              
                              
                              
                              
                              
                              (45,392
                              )
                              
                              
                              (24,105
                              )Gross
      income
                              
                              
                              
                              
                              
                              5,037
                              
                              
                              
                              5,370Operating
      expenses:Sales, marketing and
      distribution
                              
                              
                              
                              
                              
                              (2,512
                              )
                              
                              
                              (1,787
                              )General and
      administrative
                              
                              
                              
                              
                              
                              (684
                              )
                              
                              
                              (1,056
                              )Operating
      income
                              
                              
                              
                              
                              
                              1,841
                              
                              
                              
                              2,527Other
      income, net
                              
                              
                              
                              
                              
                              503
                              
                              
                              
                              147Interest
      income
                              
                              
                              
                              
                              
                              96
                              
                              
                              
                              55Interest
      expense
                              
                              
                              
                              
                              
                              (685
                              )
                              
                              
                              (369
                              )Income
      before income taxes
                              
                              
                              
                              
                              
                              1,755
                              
                              
                              
                              2,360Income
      taxes expenses
                              
                              4
                              
                              
                              
                              (249
                              )
                              
                              
                              (355
                              )Net
      income
                              
                              
                              
                              
                              
                              1,506
                              
                              
                              
                              2,005Other
      comprehensive incomeForeign
      currency translation adjustment
                              
                              
                              
                              
                              
                              121
                              
                              
                              
                              1Comprehensive
      income
                              
                              
                              
                              
                              
                              1,627
                              
                              
                              2006Shares
                              
                              
                              SharesEarnings
      per share
                              
                              3Weighted
      average number of common stock outstanding-
      basic and diluted
                              
                              
                              
                              
                              
                              50,000,000
                              
                              
                              
                              50,000,000US$
                              
                              
                              
                              US$Net
      income per share of common stock-
      basic and diluted
                              
                              
                              
                              
                              
                              0.03
                              
                              
                              
                              0.04
 
 The
financial statements should be read in conjunction with the accompanying
notes.
  F-2
  Chisen
Electric Corporation
 
 Unaudited
Condensed Consolidated Balance Sheets
 As of
June 30, 2010 and March 31, 2010
 
 (Audited)As of June
                          
                          
                          As of March30, 2010
                          
                          
                          
                          31, 2010Note
                          
                          
                          US$’000
                          
                          
                          US$’000ASSETSCurrent
      assets:Cash
      and cash equivalents
                          
                          
                          
                          
                          
                          2,996
                          
                          
                          
                          6,019Restricted
      bank balances
                          
                          5
                          
                          
                          
                          22,611
                          
                          
                          
                          21,420Other
      financial assets
                          
                          6
                          
                          
                          
                          7,705
                          
                          
                          
                          7,438Trade
      receivables, net
                          
                          
                          
                          
                          
                          55,489
                          
                          
                          
                          50,440Other
      receivables
                          
                          
                          
                          
                          
                          883
                          
                          
                          
                          800Prepayments
                          
                          
                          
                          
                          
                          2,699
                          
                          
                          
                          4,933Due
      from related parties
                          
                          14(b)
                          
                          
                          
                          11
                          
                          
                          
                          8Inventories
                          
                          7
                          
                          
                          
                          35,118
                          
                          
                          
                          30,038Total
      current assets
                          
                          
                          
                          
                          
                          127,512
                          
                          
                          
                          121,096Available-for-sale
      financial assets
                          
                          8
                          
                          
                          
                          2,665
                          
                          
                          
                          882Long-term
      land lease prepayments, net
                          
                          
                          
                          
                          
                          747
                          
                          
                          
                          749Property,
      plant and equipment, net
                          
                          9
                          
                          
                          
                          11,117
                          
                          
                          
                          10,474Total
      assets
                          
                          
                          
                          
                          
                          142,041
                          
                          
                          
                          133,201
 
 The
financial statements should be read in conjunction with the accompanying
notes.
  F-3
  Chisen
Electric Corporation
 
 Unaudited
Condensed Consolidated Balance Sheets
 As of
June 30, 2010 and March 31, 2010
 
 (Audited)As of June
                      
                      
                      As of March30, 2010
                      
                      
                      
                      31, 2010Note
                      
                      
                      US$’000
                      
                      
                      US$’000LIABILITIES
      AND SHAREHOLDERS’ EQUITYCurrent
      liabilities:Trade
      payables
                      
                      
                      
                      
                      
                      18,683
                      
                      
                      
                      14,923Notes
      payable
                      
                      10
                      
                      
                      
                      37,121
                      
                      
                      
                      35,504Accrued
      expenses and other accrued liabilities
                      
                      
                      
                      
                      
                      5,148
                      
                      
                      
                      5,087Due
      to related parties
                      
                      14(b)
                      
                      
                      
                      3,495
                      
                      
                      
                      2,532Income
      taxes payable
                      
                      
                      
                      
                      
                      123
                      
                      
                      
                      148Short-term
      bank borrowings
                      
                      11
                      
                      
                      
                      46,990
                      
                      
                      
                      46,141Total
      current liabilities
                      
                      
                      
                      
                      
                      111,560
                      
                      
                      
                      104,335Government
      subsidies
                      
                      12
                      
                      
                      
                      127
                      
                      
                      
                      139Deferred
      tax liabilities
                      
                      4(c)
                      
                      
                      
                      460
                      
                      
                      
                      460Total
      non-current liabilities
                      
                      
                      
                      
                      
                      587
                      
                      
                      
                      599Total
      liabilities
                      
                      
                      
                      
                      
                      112,147
                      
                      
                      
                      104,934Commitments
      and contingencies
                      
                      15
                      
                      
                      
                      -
                      
                      
                      
                      -Shareholders’
      equity:Preferred
      stock, US$0.001 par value each:
                      
                      
                      
                      
                      
                      -
                      
                      
                      
                      -10,000,000
      shares authorized and no shares issued and outstandingCommon
      stock, US$0.001 par value each:100,000,000
      shares authorized 50,000,000 shares issued and outstanding
                      
                      
                      
                      
                      
                      50
                      
                      
                      
                      50Capital
      reserves
                      
                      
                      
                      
                      
                      144
                      
                      
                      
                      144Statutory
      reserves
                      
                      
                      
                      
                      
                      2,423
                      
                      
                      
                      2,239Accumulated
      other comprehensive income
                      
                      
                      
                      
                      
                      1,175
                      
                      
                      
                      1,054Retained
      earnings
                      
                      
                      
                      
                      
                      26,102
                      
                      
                      
                      24,780Total
      shareholders’ equity
                      
                      
                      
                      
                      
                      29,894
                      
                      
                      
                      28,267Total
      liabilities and shareholders’ equity
                      
                      
                      
                      
                      
                      142,041
                      
                      
                      
                      133,201
 
 The
financial statements should be read in conjunction with the accompanying
notes.
  F-4
  Chisen
Electric Corporation
 
 Consolidated
Condensed Statements of Changes in Shareholders' Equity
 For the
three months ended June 30, 2010
 
 Common stock issuedNumber
                    of shares
                  
                  
                  Amount
                  
                  
                  Capital
                    reserves
                  
                  
                  Statutory
                    reserves
                  
                  
                  Retained
                    earnings
                  
                  
                  Accumulated
                    other
                    comprehensive
                    income
                  
                  
                  TotalUS$’000
                  
                  
                  US$’000
                  
                  
                  US$’000
                  
                  
                  US$’000
                  
                  
                  US$’000
                  
                  
                  US$’000Balance
      as of April 1, 2010
                  
                  
                  50,000,000
                  
                  
                  
                  50
                  
                  
                  
                  144
                  
                  
                  
                  2,239
                  
                  
                  
                  24,780
                  
                  
                  
                  1,054
                  
                  
                  
                  28,267Net
      income
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  1,506
                  
                  
                  
                  -
                  
                  
                  
                  1,506Transfer
      to statutory reserves
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  184
                  
                  
                  
                  (184
                  )
                  
                  
                  -
                  
                  
                  
                  -Foreign
      currency translation adjustment
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  121
                  
                  
                  
                  121Balance
      as of June 30, 2010
                  
                  
                  50,000,000
                  
                  
                  
                  50
                  
                  
                  
                  144
                  
                  
                  
                  2,423
                  
                  
                  
                  26,102
                  
                  
                  
                  1,175
                  
                  
                  
                  29,894
 
 The
financial statements should be read in conjunction with the accompanying
notes.
  F-5
  Chisen
Electric Corporation
 
 Consolidated
Condensed Consolidated Statements of Cash Flows
 For the
three months ended June 30, 2010 and 2009
 
 Three months ended June 30,2010
                  
                  
                  2009US$’000
                  
                  
                  US$’000Cash
      flows from operating activitiesNet
      income
                  
                  
                  1,506
                  
                  
                  
                  2,005Adjustments
      to reconcile net income to net cash provided by operating
      activities:Depreciation
      of property, plant and equipment
                  
                  
                  252
                  
                  
                  
                  132Written-off
      of property, plant and equipment
                  
                  
                  -
                  
                  
                  
                  6Amortization
      of long-term land lease prepayments
                  
                  
                  4
                  
                  
                  
                  3Exchange
      differences
                  
                  
                  7
                  
                  
                  
                  (1
                  )Provision
      for warranty costs
                  
                  
                  325
                  
                  
                  
                  25Government
      grant recognized
                  
                  
                  (12
                  )
                  
                  
                  (12
                  )Due
      from related parties
                  
                  
                  (3
                  )
                  
                  
                  (378
                  )Changes
      in assets and liabilities:Other
      financial assets
                  
                  
                  (237
                  )
                  
                  
                  (822
                  )Accounts
      receivables, net
                  
                  
                  (4,845
                  )
                  
                  
                  89Other
      receivables
                  
                  
                  (79
                  )
                  
                  
                  (206
                  )Prepayment
                  
                  
                  2,254
                  
                  
                  
                  (1,289
                  )Inventories
                  
                  
                  (4,957
                  )
                  
                  
                  (4,630
                  )Accounts
      payable
                  
                  
                  3,699
                  
                  
                  
                  (2,482
                  )Notes
      payable
                  
                  
                  1,473
                  
                  
                  
                  4,675Accrued
      expenses and other accrued liabilities
                  
                  
                  (108
                  )
                  
                  
                  2,846Due
      to related parties
                  
                  
                  951
                  
                  
                  
                  (320
                  )Income
      taxes payable
                  
                  
                  -
                  
                  
                  
                  22Net
      cash provided by (used in) operating activities
                  
                  
                  230
                  
                  
                  
                  (337
                  )Cash
      flows from investing activitiesPurchase
      of property, plant and equipment
                  
                  
                  (1,056
                  )
                  
                  
                  (211
                  )Investment
      in restricted bank balances, net
                  
                  
                  (1,105
                  )
                  
                  
                  (4,675
                  )Acquisition
      of available-for-sale financial assets
                  
                  
                  (1,779
                  )
                  
                  
                  -Net
      cash used in investing activities
                  
                  
                  (3,940
                  )
                  
                  
                  (4,886
                  )
 
 The
financial statements should be read in conjunction with the accompanying
notes.
  F-6
  Chisen
Electric Corporation
 
 Consolidated
Condensed Consolidated Statements of Cash Flows
 For the
three months ended June 30, 2010 and 2009
 
 Three months ended June 30,2010
                  
                  
                  2009US$’000
                  
                  
                  US$’000Cash
      flows from financing activitiesProceeds
      from bills financing
                  
                  
                  -
                  
                  
                  
                  5,844Proceeds
      from short-term bank loans
                  
                  
                  6,334
                  
                  
                  
                  13,587Repayment
      of short-term bank loans
                  
                  
                  (5,671
                  )
                  
                  
                  (7,743
                  )Net
      cash provided by financing activities
                  
                  
                  663
                  
                  
                  
                  11,688Net
      (decrease) increase in cash and cash equivalents
                  
                  
                  (3,047
                  )
                  
                  
                  6,465Cash
      and cash equivalents, beginning of period
                  
                  
                  6,019
                  
                  
                  
                  2,620Effect
      on exchange rate changes
                  
                  
                  24
                  
                  
                  
                  -Cash
      and cash equivalents, end of period
                  
                  
                  2,996
                  
                  
                  
                  9,085Supplemental
      disclosure of cash flow informationInterest
      received
                  
                  
                  96
                  
                  
                  
                  -Interest
      paid
                  
                  
                  685
                  
                  
                  
                  369Tax
      paid
                  
                  
                  274
                  
                  
                  
                  264
 
 The
financial statements should be read in conjunction with the accompanying
notes.
  F-7
  Chisen
Electric Corporation
 
 Notes
to an Forming Part of Unaudited Condensed Consolidated Financial
Statements
 For the
three months ended June 30, 2010 and 2009
 1.
              ORGANIZATION
      AND PRINCIPAL ACTIVITIES
 
 Chisen
Electric Corporation (“Chisen Electric”), formerly known as World Trophy
Oufitters, Inc., was formed as a Nevada corporation on January 13, 2005. Its
common stocks are currently trading on the Over-The-Counter Bulletin Board under
the symbol “CIEC.OB”.
 
 Chisen
Electric is an investment holding company with no operations. The principal
activities of its subsidiaries (together with Chisen Electric, collectively
referred as “the Company”) are the manufacture and sales of sealed lead-acid
battery products and investment holding.
 
 Details
of Chisen Electric’s subsidiaries as of June 30, 2010 are as
follows:
 
 Name
                      Place and
                        date of
                        establishment /
                        incorporation
                      
                      Percentage of
                        effective equity
                        interest / voting
                        right attributable
                        to the Company
                      
                      Principal activitiesFast
      More Limited (“Fast More”)
                      Hong
      Kong
                        December
      17, 2007
                      
                      
                      100
                      %
                      Investment
      holdingChangxing Chisen Battery Co.,
      Limited (“Changxing Chisen”) *
                      Zhejiang,
                        the
      People’s Republic of China (“PRC”)
                        February
      25, 2002
                      
                      
                      100
                      %
                      Manufacture
      and sales of sealed lead-acid battery productsChisen Technolgy Holdings Corporation (“Chisen Technology”)
                      Nevada,
                        United
      States
                        May
      18, 2009
                      
                      
                      100
                      %
                      Inactive
 
 *
              This is a direct translation
      of the name in Chinese for identification purpose only and is not the
      official name in
English.
  F-8
  Chisen
Electric Corporation
 
 Notes
to an Forming Part of Unaudited Condensed Consolidated Financial
Statements
 For the
three months ended June 30, 2010 and 2009
 
 2.
              PREPRATION
      OF INTERIM FINANCIAL STATEMENTS
  Basis
of presentations
  The
accompanying unaudited condensed consolidated financial statements as of June
30, 2010 have been prepared based upon Securities and Exchange Commission rules
that permit reduced disclosure for interim periods and include, in the opinion
of management, all adjustments (consisting of normal recurring adjustments and
reclassifications) necessary to present fairly the financial position, results
of operations and cash flows as of June 30, 2010 and for all periods
presented.
  Certain
information and footnote disclosures normally included in financial statements
prepared in accordance with generally accepted accounting principles in the
United States of America (“USGAAP”) have been condensed or omitted. These
condensed consolidated financial statements should be read in conjunction with
the audited financial statements and notes thereto included in the Chisen
Electric's Form 10-K filed on June 28, 2010 for the year ended March 31, 2010.
The results of operations for the three months ended June 30, 2010 and 2009 are
not necessarily indicative of the operating results to be expected for the full
year.
  The
condensed consolidated financial statements and accompanying notes are presented
in United States dollars and prepared in conformity with USGAAP which requires
management to make certain estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of financial statements and the reported amounts of
revenues and expenses during the reporting period. Actual results could differ
from those estimates.
 
 Basis
of consolidation
 The
consolidated financial statements include the financial information of Chisen
Electric and its subsidiaries. All significant intercompany accounts and
transactions have been eliminated upon consolidation.
 
 Recent
accounting pronouncements
 In
January 2010, FASB issued ASU No. 2010-02 regarding accounting and reporting for
decreases in ownership of a subsidiary. Under this guidance, an
entity is required to deconsolidate a subsidiary when the entity ceases to have
a controlling financial interest in the subsidiary.  Upon deconsolidation
of a subsidiary, an entity recognizes a gain or loss on the transaction and
measures any retained investment in the subsidiary at fair value.  In
contrast, an entity is required to account for a decrease in its ownership
interest of a subsidiary that does not result in a change of control of the
subsidiary as an equity transaction.  This ASU clarifies the scope of the
decrease in ownership provisions, and expands the disclosures about the
deconsolidation of a subsidiary or de-recognition of a group of assets.
 This ASU is effective for the first interim or annual reporting period
ending on or after December 31, 2009. The adoption of ASU No. 2010-02 did
not have any affect on the Company’s consolidated financial
statements.
  F-9
  Chisen
Electric Corporation
 
 Notes
to an Forming Part of Unaudited Condensed Consolidated Financial
Statements
 For the
three months ended June 30, 2010 and 2009
 
 2.
              PREPRATION
      OF INTERIM FINANCIAL STATEMENTS
(CONTINUED)
 
 Recent
accounting pronouncements (continued)
 In
January 2010, FASB issued ASU No. 2010-06 – Improving Disclosures about Fair
Value Measurements. This ASU amends FASB ASC 820 to require a number of
additional disclosures regarding fair value measurements. Specifically, this ASU
requires entities to disclose: (1) the amount of significant transfers between
Level 1 and Level 2 of the fair value hierarchy and the reasons for these
transfers; (2) the reasons for any transfers in or out of Level 3; and (3)
information in the reconciliation of recurring Level 3 measurements about
purchases, sales, issuances and settlements on a gross basis. Except for the
requirement to disclose information about purchases, sales, issuances, and
settlements in the reconciliation of recurring Level 3 measurements on a gross
basis, which is effective for fiscal years beginning after December 15, 2010,
all the amendments to FASB ASC 820 made by this ASU are effective for interim
and annual reporting periods beginning after December 15, 2009. The adoption of
this ASU did not have any effect on the Company’s consolidated financial
statements.
 
 3.
              EARNINGS
      PER SHARE
 
 Basic
earnings per share is computed by dividing income available to common
stockholders by the weighted-average number of common stocks outstanding during
the period. Diluted earnings per share is computed similar to basic earnings per
share except that the denominator is increased to include the number of
additional common stocks that would have been outstanding if the potential
common shares had been issued and if the additional common shares were dilutive.
There were no potentially dilutive securities for the three months ended June
30, 2010 and 2009.
 
 4.
              INCOME
      TAXES
 
 Chisen
Electric had a net operating loss carry-forward for income tax reporting
purposes that might be offset against future taxable income. No tax benefit has
been reported in the financial statements, because Chisen Electric believes that
it is more likely than not that the carry-forwards will finally expire and
therefore cannot be used.  Accordingly, the potential tax benefits of
the loss carry-forwards are offset by a valuation allowance of the same
amount.
 
 Chisen
Electric’s subsidiaries are subject to income taxes on an entity basis on income
arising in or derived from the tax jurisdictions in which each entity domiciles
and operates.
 
 Hong Kong
Profits Tax has not been provided as Fast More had no assessable profit for the
period.
 
 Changxing
Chisen is subject to state and local enterprise income taxes in the PRC at a
standard rate of 25%. Changxing Chisen received official designation by the
local tax authority as a foreign invested enterprise engaged in manufacturing
activities and is confirmed by the local tax authority that it is exempted from
enterprise income tax for two years commencing from the first profitable year in
2006, followed by a 50% reduction for the next three years.
 
 Dividends
payable by a foreign invested enterprise in the PRC to its foreign investors in
Hong Kong are subject to a 5% withholding tax. No deferred tax expenses were
charged to the statement of operations for the three months ended June 30, 2010
and 2009.
  F-10
  Chisen
Electric Corporation
 
 Notes
to an Forming Part of Unaudited Condensed Consolidated Financial
Statements
 For the
three months ended June 30, 2010 and 2009
 
 4.
              INCOME
      TAXES (CONTINUED)
 
 (a)
              Income
      tax expenses are comprised of the
following:
 
 Three months ended June 30,2010
                        
                        
                        2009US$’000
                        
                        
                        US$’000Current
      taxes arising in the PRC:For
      the period
                        
                        
                        249
                        
                        
                        
                        355
  The FASB
ASC Topic 740 “Income Taxes” clarifies the accounting and disclosure for
uncertainty in tax positions, as defined, and prescribes the measurement process
and a minimum recognition threshold for a tax position, taken or expected to be
taken in a tax return, that is required to be met before being recognized in the
financial statements. Under ASC 740, the Company must recognize the tax benefit
from an uncertain position only if it is more-likely-than-not the tax position
will be sustained on examination by the tax authority, based on the technical
merits of the position. The tax benefits recognized in the financial statements
attributable to such position are measured based on the largest benefit that has
a greater than 50% likelihood of being realized upon the ultimate resolution of
the position.
  Subject
to the provision of ASC 740, the Company has analyzed its filing positions in
all of the domestic and foreign jurisdictions where it is required to file
income tax returns. As of June 30, 2010 and 2009, the Company has identified the
following jurisdictions as “major” tax jurisdictions, as defined, in which it is
required to file income tax returns in United States, Hong Kong and the PRC.
Based on the evaluations noted above, the Company has concluded that there are
no significant uncertain tax positions requiring recognition in its unaudited
condensed consolidated financial statements.
  As of
March 31, 2010 and 2009, the Company had no unrecognized tax benefits or
accruals for the potential payment of interest and penalties. The Company’s
policy is to record interest and penalties in this connection as a component of
the provision for income tax expense. For the three months ended June 30, 2010
and 2009, no interest or penalties were recorded.
  F-11
  Chisen
Electric Corporation
 
 Notes
to an Forming Part of Unaudited Condensed Consolidated Financial
Statements
 For the
three months ended June 30, 2010 and 2009
 
 4.
              INCOME
      TAXES (CONTINUED)
  (b)
              Reconciliation
      from the expected income tax expenses calculated with reference to the
      statutory tax rate in the PRC of 25% (2009: 25%) is as
      follows:
 
 Three months ended June 30,2010
                        
                        
                        2009US$’000
                        
                        
                        US$’000Expected
      income tax expenses
                        
                        
                        571
                        
                        
                        
                        590Effect
      on tax incentives / holiday
                        
                        
                        (203
                        )
                        
                        
                        (332
                        )Non-deductible
      items
                        
                        
                        -
                        
                        
                        
                        73Non-taxable
      income
                        
                        
                        (165
                        )
                        
                        
                        -Others
                        
                        
                        46
                        
                        
                        
                        24Income
      tax expenses
                        
                        
                        249
                        
                        
                        
                        355
 
 (c)
              Components
      of net deferred tax liabilities were as
follows:
 (Audited)As of June 30,
                                  
                                  
                                  As of March 31,2010
                                  
                                  
                                  2010US$’000
                                  
                                  
                                  US$’000Withholding
      tax on undistributed earnings of a PRC subsidiary
                                  
                                  
                                  460
                                  
                                  
                                  
                                  460
 
 5.
              RESTRICTED
      BANK BALANCES
 
 Restricted
bank balances as of June 30, 2010 and March 31, 2010 represented time deposits
with original maturity between three and twelve months. As of June 30, 2010 and
March 31, 2010, all restricted bank balances were pledged for the issue of notes
payable as disclosed in Note 10 below.
 
 6.
              OTHER
      FINANCIAL ASSETS
 
 Other
financial assets represented notes receivable from customers for the settlement
of accounts receivable balances. As of June 30, 2010 and March 31, 2010, all
notes receivable were guaranteed by established banks in the PRC and had
maturities of 6 months or less from the date of issue. The fair value of
the notes receivable approximated their carrying value.
  F-12
  Chisen
Electric Corporation
 
 Notes
to an Forming Part of Unaudited Condensed Consolidated Financial
Statements
 For the
three months ended June 30, 2010 and 2009
 
 7.
              INVENTORIES
  Inventories
consisted of the following:
 (Audited)As of June 30,
                      
                      
                      As of March 31,2010
                      
                      
                      2010US$’000
                      
                      
                      US$’000Raw
      materials
                      
                      
                      3,529
                      
                      
                      
                      7,186Work-in-progress
      and semi-finished goods
                      
                      
                      19,990
                      
                      
                      
                      13,482Finished
      goods
                      
                      
                      11,599
                      
                      
                      
                      9,37035,118
                      
                      
                      
                      30,038
 
 8.
              AVAILABLE-FOR-SALE
      FINANCIAL ASSETS
 
 Available-for-sale
financial assets as of June 30, 2010 and March 31, 2010 represented investment
in unlisted equity securities and are recorded at cost. The management has
estimated that the recoverable amount of the assets exceed their carrying
value.
 
 9.
              PROPERTY,
      PLANT AND EQUIPMENT, NET
 
 Property,
plant and equipment is summarized as follows:
 
 (Audited)As of June 30,
                    
                    
                    As of March 31,2010
                    
                    
                    2010US$’000
                    
                    
                    US$’000Buildings
                    
                    
                    5,491
                    
                    
                    
                    5,468Leasehold
      improvements
                    
                    
                    659
                    
                    
                    
                    495Plant
      and machinery
                    
                    
                    4,674
                    
                    
                    
                    4,071Motor
      vehicles
                    
                    
                    978
                    
                    
                    
                    974Furniture,
      fixtures and office equipment
                    
                    
                    1,529
                    
                    
                    
                    1,419Construction-in-progress
                    
                    
                    -
                    
                    
                    
                    -13,331
                    
                    
                    
                    12,427Accumulated
      depreciation
                    
                    
                    (2,214
                    )
                    
                    
                    (1,953
                    )11,117
                    
                    
                    
                    10,474
 
 Depreciation
expenses were approximately US$252,000 and US$132,000 for the three months
ended June 30, 2010 and 2009, respectively.
 
 The
Company has pledged certain buildings as collaterals against general banking
facilities granted to the Company. Details of which are disclosed in Note
11.
  F-13
  Chisen
Electric Corporation
 
 Notes
to an Forming Part of Unaudited Condensed Consolidated Financial
Statements
 For the
three months ended June 30, 2010 and 2009
 
 10.
              NOTES
      PAYABLE
  All notes
payable issued by the Company were interest-free, guaranteed by banks, repayable
within six months from date of issue and collateralized by restricted bank
balances as set out in Note 5 and certain land lease prepayments and buildings
as set out in Note 11(i) below.
  In
addition, various parties have issued guarantee against these notes payable as
follows:
  (Audited)As of June 30,
                    
                    
                    As of March 31,2010
                    
                    
                    2010US$’000
                    
                    
                    US$’000Corporate
      and personal guarantees issued by relatedparties
      (Note 14(d))
                    
                    
                    14,804
                    
                    
                    
                    14,377Corporate
      guarantees issued by third parties
                    
                    
                    1,473
                    
                    
                    
                    1,467
  11.
              SHORT-TERM
      BANK BORROWINGS
  Short-term
bank borrowings comprise of the followings:
 (Audited)As of June 30,
                      
                      
                      As of March 31,Note
                      
                      2010
                      
                      
                      2010US$’000
                      
                      
                      US$’000Short-term
      bank loans
                      (i)
                      
                      
                      43,307
                      
                      
                      
                      42,473Bills
      financing
                      (ii)
                      
                      
                      3,683
                      
                      
                      
                      3,66846,990
                      
                      
                      
                      46,141
  (i)
              Short-term
      bank loans
  Short-term
bank loans represent amounts due to various banks which are due within 12
months, and these loans can normally be renewed with the banks upon
expiry/maturity.
  The loans
and the notes payables as set out in Note 10 are collateralized by land lease
prepayments and buildings of the Company with carrying values as
follows:
  (Audited)As of June 30,
                      
                      
                      As of March 31,2010
                      
                      
                      2010US$’000
                      
                      
                      US$’000Land
      lease prepayments
                      
                      
                      597
                      
                      
                      
                      598Buildings
                      
                      
                      1,570
                      
                      
                      
                      2,0182,167
                      
                      
                      
                      2,616
  F-14
  Chisen
Electric Corporation
 
 Notes
to an Forming Part of Unaudited Condensed Consolidated Financial
Statements
 For the
three months ended June 30, 2010 and 2009
 
 11.
              SHORT-TERM
      BANK BORROWINGS (CONTINUED)
  (i)
              Short-term
      bank loans (continued)
  Various
parties have also issued guarantee against these short-term bank loans as
follows:
  (Audited)As of June 30,
                    
                    
                    As of March 31,2010
                    
                    
                    2009US$’000
                    
                    
                    US$’000Corporate
      and personal guarantees issued byrelated
      parties (Note 14(d))
                    
                    
                    31,376
                    
                    
                    
                    30,589Corporate
      guarantees issued by third parties
                    
                    
                    1,473
                    
                    
                    
                    1,467Corporate
      and personal guarantees issued by related parties and a third party
      jointly (Note 14(d))
                    
                    
                    8,838
                    
                    
                    
                    8,802
  The
weighted average annual interest rates of the short-term bank loans were 5.41%
and 5.40% as of June 30, 2010 and March 31,2010 respectively.
  (ii)
              Bills
      financing
  Bill
financing represents amounts due to various banks which are repayable within six
months from the date of issue. At June 30, 2010, the bills are secured by
certain restricted bank balances of the Company with carrying value of
US$1,768,000 and guaranteed by certain related parties to the extent of
US$1,915,000.
 
 The
weighted average annual interest rates of the bills financing were
3.96% and 3.96% as of June 30, 2010 and March 31, 2010,
respectively.
 
 12.
              GOVERNMENT
      SUBSIDIES
 
 During
the year ended March 31, 2008, the Company received a government grant of
approximately US$231,000 for the purpose of subsidising its acquisition of
property, plant and equipment, of which approximately US$12,000 and US$12,000
was credited to the statement of operations for the three months ended June 30,
2010 and 2009, respectively.
  F-15
  Chisen
Electric Corporation
 
 Notes
to an Forming Part of Unaudited Condensed Consolidated Financial
Statements
 For the
three months ended June 30, 2010 and 2009
 
 13.
              FAIR
      VALUE MEASUREMENT
 
 The
Company adopted ASC Topic 820 – Fair Value Measurements and
Disclosures (“ASC 820”). The adoption of ASC 820 did not have a material
impact on our consolidated financial statements. ASC 820 establishes a
three-tier fair value hierarchy to prioritize the inputs used in measuring fair
value.  The hierarchy gives the highest priority to quoted prices in
active markets (Level 1) and the lowest priority to unobservable inputs (Level
3).  The three levels are defined as follows:
 
 Level
1:
              Observable
      inputs, such as unadjusted quoted market prices in active markets for the
      identical asset or liabilities.
 
 Level
2:
              Inputs
      that are observable for the asset or liability, either directly or
      indirectly through market corroboration, for substantially the full term
      of the financial instrument.
 
 Level
3:
              Unobservable
      inputs reflecting the entity’s own assumptions in measuring the asset or
      liability at fair value.
 
 The
Company’s financial instruments consist principally of cash and cash
equivalents, restricted bank balances, other financial assets, trade receivables
and payables, deposits, prepayment and other receivables, notes payable, accrued
expenses and other liabilities, amount due from/to related parties and
short-term borrowings which are carried at amounts that generally approximate
their fair values because of the short-term maturity of these
instruments.
 
 14.
              RELATED
      PARTY TRANSACTIONS
  (a)
                Names
      and relationship of related
parties:
  Name of related party
                  
                  Existing relationships with the
      CompanyMr.
      Xu Kecheng
                  
                  Director
      and controlling stockholder of Chisen ElectricZhejiang
      Chisen Glass Company Limited (“Chisen Glass”)*
                  
                  A
      company controlled by a close family member of Mr. Xu
    KechengMr.
      Xu Keyong
                  
                  A
      close family member of Mr. Xu KechengMs.
      Zhou Fang Qin
                  
                  Spouse
      of Mr. Xu KechengChangxing
      Chisen Xinguangyuan Company Limited (“Xinguangyuan”)*
                  
                  A
      company controlled by a close family member of Mr. Xu
    KechengZhejiang
      Ai Ge Organism Products Company Limited (“Ai Ge
Organism”)*
                  
                  A
      company controlled by Mr. Xu KechengZhejiang
      Changxing Nuo Wan Te Ke Glass Company Limited (“Nuo Wan Te
      Ke”)*
                  
                  A
      company controlled by a close family member of Mr. Xu
    KechengZhejiang
      Changxing Ruilang Electronic Company Limited (“Ruilang
      Electronic”)
                  
                  A
      company controlled by a close family member of Mr. Xu
    Kecheng
  *
                These
      are direct translations of the name in Chinese for identification purpose
      only and are not official names in
English.
  F-16
  Chisen
Electric Corporation
 
 Notes
to an Forming Part of Unaudited Condensed Consolidated Financial
Statements
 For the
three months ended June 30, 2010 and 2009
 
 14.
              RELATED
      PARTY TRANSACTIONS (CONTINUED)
  (b)
                Summary
      of balances with related
parties:
 (Audited)As of June 30,
                    
                    
                    As of March 31,2010
                    
                    
                    2010US$’000
                    
                    
                    US$’000Due
      from related parties:Ms.
      Zhou Fang Qin
                    
                    
                    11
                    
                    
                    
                    8Due
      to related parties:Mr.
      Xu Keyong
                    
                    
                    25
                    
                    
                    
                    25Chisen
      Glass
                    
                    
                    666
                    
                    
                    
                    110Ruilang
      Electronic
                    
                    
                    2,490
                    
                    
                    
                    2,102Ai
      Ge Organism
                    
                    
                    293
                    
                    
                    
                    292Nuo
      Wan Te Ke
                    
                    
                    3
                    
                    
                    
                    3Xinguangyuan
                    
                    
                    18
                    
                    
                    
                    -3,495
                    
                    
                    
                    2,532
  All
amounts due from / to related parties represent unsecured advances which are
interest-free and repayable on demand.
  (c)
                Summary
      of related party
transactions:
 
 Name of relatedparty
                    Nature of transactions
                    
                    Three months ended June 30,2010
                    
                    
                    2009US$’000
                    
                    
                    US$’000Ruilang
      Electronic
                    Purchase
      of raw materials
                    
                    
                    1,933
                    
                    
                    
                    -Chisen
      Glass
                    Purchase
      of raw materials
                    
                    
                    660
                    
                    
                    
                    -
  F-17
  Chisen
Electric Corporation
 
 Notes
to an Forming Part of Unaudited Condensed Consolidated Financial
Statements
 For the
three months ended June 30, 2010 and 2009
 
 14.
              RELATED
      PARTY TRANSACTIONS (CONTINUED)
  (d)
                Other
      arrangements:
 
  ̇
              As
      of June 30, 2010, Chisen Glass provided guarantees, in aggregate,
      amounting to US$5,892,000, US$810,000 and US$442,000 to secure the
      short-term bank loans, notes payable and bill financing of the Company,
      respectively.
 
  ̇
              As
      of June 30, 2010, US$4,419,000 of
      the Company’s short-term bank loans was collateralized by land use rights
      owned by Ruilang Electronic and guaranteed by Mr. Xu Kecheng and
      Ms. Zhou Fang Qin.
 
  ̇
              As
      of June 30, 2010,  Xinguangyuan, Mr. Xu Kecheng and a third
      party provided guarantees, in aggregate, amounting to US$8,838,000 to
      secure the short-term bank loans of the
Company.
 
  ̇
              As
      of June 30, 2010, Xinguangyuan and Mr. Xu Kecheng provided
      guarantees, in aggregate, amounting to US$11,784,000 and
      US$5,892,000 to secure the short-term bank loans and notes payable of
      the Company, respectively.
 
  ̇
              As
      of June 30, 2010, Chisen Glass, Mr. Xu Kecheng and Ms. Zhou Fang Qin
      provided guarantees, in the aggregate, amounting to US$9,281,000,
      US$4,420,000 and US$1,473,000 to secure the short-term bank
      loans, notes payable and bills financing of the Company,
      respectively.
 
  ̇
              As
      of June 30, 2010, Xinguangyuan provided guarantees, in aggregate,
      amounting to US$3,682,000 to secure the notes payable of the
      Company.
  F-18
  Chisen
Electric Corporation
 
 Notes
to an Forming Part of Unaudited Condensed Consolidated Financial
Statements
 For the
three months ended June 30, 2010 and 2009
 
 15.
              COMMITMENTS
      AND CONTINGENCIES
 
 (a)
              Operating
      lease commitments
 
 The
following table summarizes the approximate future minimum rental payments under
non-cancelable operating leases in effect as of June 30, 2010 and March 31,
2010:
 
 (Audited)As of June 30,
                      
                      
                      As of March 31,2010
                      
                      
                      2010US$’000
                      
                      
                      US$’000Within
      one year
                      
                      
                      609
                      
                      
                      
                      599One
      to two years
                      
                      
                      640
                      
                      
                      
                      630Two
      to three years
                      
                      
                      672
                      
                      
                      
                      661Three
      to four years
                      
                      
                      362
                      
                      
                      
                      489Four
      to five years
                      
                      
                      72
                      
                      
                      
                      115Total
                      
                      
                      2,355
                      
                      
                      
                      2,494
 
 (b)
              Capital
      commitments
 
 As of
June 30, 2010 and March 31, 2010, the Company had capital expenditure
commitments for construction projects and purchase of machineries for an
aggregate amount of approximately US$84,000 and US$84,000,
respectively.
 
 16.
              PROVISION
      FOR WARRANTY
 
 Estimated
warranty costs are recognised at the time when the Company sells its products
and are included in sale, marketing and distribution expenses. The Company uses
historical failure rates and costs to repair product defects during the warranty
period to estimate warranty costs while are reviewed periodically in light of
actual experience. The reconciliation of the changes in the warranty obligation
is as follows:
 
 Three months ended June 30,2010
                    
                    
                    2009US$’000
                    
                    
                    US$’000Balance
      as of April 1,
                    
                    
                    226
                    
                    
                    
                    121Exchange
      realignment
                    
                    
                    1
                    
                    
                    
                    1Accrual
      for warranties issued during the period
                    
                    
                    324
                    
                    
                    
                    40Settlement
      made during the period
                    
                    
                    (268
                    )
                    
                    
                    (15
                    )Balance
      as of June 30,
                    
                    
                    283
                    
                    
                    
                    147
  F-19
  Chisen
Electric Corporation
 
 Notes
to an Forming Part of Unaudited Condensed Consolidated Financial
Statements
 For the
three months ended June 30, 2010 and 2009
 
 17.
              RETIREMENT
      PLAN COSTS
 
 Contributions
to defined contribution retirement schemes are charged to cost of sales, sales,
marketing and distribution costs and general and administrative expenses in the
consolidated statements of operations and other comprehensive income as and when
the related employee services are provided. Retirement plan costs were
US$129,000 and US$209,000 for the three months ended June 30, 2010 and 2009
respectively.
 
 18.
              SEGMENTAL
      INFORMATION
 
 During
the three months ended June 30, 2010 and 2009, all revenue of the Company
represented income from sales of sealed lead-acid battery and therefore no
financial information by business segment is presented. Furthermore, as all
income is derived from the PRC, no geographical segment is
presented.
  F-20




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




Forward
Looking Statements




The
following discussion of our financial condition and results of operations of
Chisen Electric Corporation (formerly known as World Trophy Outfitters, Inc.,
and the term “World
Trophy” is used when discussing the operations of the Company prior to
November 12, 2008 and the “Registrant” when
discussing its operations after November 12, 2008) is based upon and should be
read in conjunction with our consolidated financial statements and their related
notes included in this report. This report contains forward-looking statements.
Generally, the words “believes”, “anticipates”, “may”, “will”, “should”,
“expect”, “intend”, “estimate”, “continue” and similar expressions or the
negative thereof or comparable terminology are intended to identify
forward-looking statements. Such statements are subject to certain risks and
uncertainties, including the matters set forth in this report or other reports
or documents we file with the SEC from time to time, which could cause actual
results or outcomes to differ materially from those projected. Undue reliance
should not be placed on these forward-looking statements which speak only as of
the date hereof. We undertake no obligation to update these forward-looking
statements.





Exchange
Agreement





On
November 12, 2008 (the “Closing Date”), World
Trophy entered into a Share Exchange Agreement (the “Exchange”) with Fast
More Limited, a Hong Kong investment holding company (“Fast More”), Cheer
Gold Development Limited, a company organized under the laws of Samoa (“Cheer Gold”) and
Floster Investment Limited, a company organized under the laws of Samoa (“Floster” and together
with Cheer Gold, the “Stockholders”). As a
result of the share exchange, World Trophy acquired all of the issued and
outstanding securities of Fast More from the Stockholders in exchange for
Thirty-Five Million (35,000,000) newly-issued shares of World Trophy’s common
stock, par value $0.001 per share (“Common Stock”), of
which Thirty-Two Million Nine Hundred Thousand (32,900,000) shares were issued
to Cheer Gold and Two Million One Hundred Thousand (2,100,000) shares were
issued to Floster. As of the Closing Date, the Stockholders collectively
beneficially owned seventy percent (70%) of the voting capital stock of the
Company, 65.8% of which is owned by Cheer Gold and 4.2% of which is owned by
Floster. As a result of the Exchange, Fast More became a wholly-owned subsidiary
of World Trophy.





Effective
February 2, 2009, the Registrant amended its Articles of Incorporation to change
its name from “World Trophy Outfitters, Inc.” to “Chisen Electric Corporation”.
The following is disclosure regarding the Registrant, Fast More and Fast More’s
wholly-owned and chief operating subsidiary, Changxing Chisen Electric Co., Ltd.
(hereinafter referred to as “CCEC”, and together
with Fast More and the Registrant, the “Company”), the
principal business activities of which consist of the manufacture and sale of
sealed lead-acid battery products primarily in the electric bicycle
market.





Prior
Operations of World Trophy





World
Trophy was formed as a Nevada corporation on January 13, 2005, and had been in
the business of selling big game hunting packages to high end clients who sought
to hunt with the top tier big game outfitters.  Its main product sold was
hunting trips, which included the hunting license and guide fees.  World
Trophy purchased and resold several hunting trips, selling them at a profit or
for a mark-up. World Trophy also provided incidental advisory services to
purchasers of hunting trips by helping these clients select an appropriate hunt,
with no additional fees charged for these services.





During
the year ended March 31, 2008, World Trophy sold its entire inventory of big
game hunts, but was unsuccessful in developing a profitable business.
 World Trophy ceased its operations and became a development stage company
effective April 1, 2008. Prior to the Exchange, World Trophy focused its efforts
on seeking a business opportunity and had been in the process of locating and
negotiating with business entities for the merger of a target company into World
Trophy.




The
Registrant’s Common Stock is currently traded on the OTCQB under the symbol
“CIEC”. Immediately prior to the Exchange, World Trophy was considered a “blank
check” development stage company with US$51,039 in assets and a net loss of
US$(27,977) for the three (3) months ended September 30, 2008.  On the
Closing Date, the Registrant did not have any liabilities.





Current
Operations of the Company




Fast More
is an investment holding company incorporated in Hong Kong on December 17, 2007
with limited liability. CCEC was founded in Huzhou, Zhejiang Province in China
in 2002. On February 16, 2008, Fast More acquired the 51%, 9% and 40% equity
interests in CCEC from Mr. Xu Kecheng, Mr. Xu Keyong and BEME International Co.,
Ltd., respectively, for RMB6,502,500 (approximately US$926,000), RMB1,147,500
(approximately US$164,000) and RMB 5,100,000 (approximately US$726,000),
respectively. Upon the completion of these acquisition transactions, CCEC became
the wholly-owned and chief operating subsidiary of Fast More.  Since
the ultimate beneficial owner of Fast More was, at all times, the substantial
stockholder of CCEC (Mr. Xu Kecheng), the ownership transfer transaction was
accounted for as a transfer of entities under common control in accordance with
the FASB Accounting Standards Codification (“ASC”) Topic 805.


4





On May
18, 2009, the Registrant incorporated Chisen Technology Holdings Corporation in
Nevada as its wholly-owned subsidiary.  Chisen Technology Holdings
Corporation is authorized to do business in the State of Washington and up to
the filing date of this report, this entity has no operations.





Summary
of the Company’s Current Business




The
Company is a leading lead-acid motive battery producer in China's personal
transportation device market. Our motive battery products are sold under our own
brand name and are predominantly used in electric bicycles and distributed and
sold in China. Electric bicycles become increasingly popular. Among all types of
batteries for electric bicycles, the lead-acid motive battery is the preferred
choice for electric bicycle manufacturers in China because of its cost
efficiency.





Today,
the Company manufactures over 15,000,000 batteries each year, has more than
2,500 employees and is one of China's largest manufacturers of lead-acid
batteries for electric-powered bicycles (LABEBs). For each of the Company’s
fiscal years ended March 31, 2010 and 2009, sales revenues were US$177,192,000
and US$109,020,000, respectively, and our net income during the same periods
amounted to US$9,500,000 and US$8,880,000, respectively.





The
Company is located at Changxing Economic Development Zone at the bank of the
Taihu Lake in Zhejiang Province, in close proximity to major national
transportation systems, including National Highways 104 and 318, the Shanghai –
Jiangsu – Zhejiang – Anhui – Hangzhou – Nanjing Expressway, the Changxing –
Huzhou – Shanghai Channel, the Xuancheng – Hangzhou Railway and the Xinyi –
Changxing Railway. The Company’s corporate offices are located at Jingyi Road,
Changxing Economic Development Zone, Changxing, Zhejiang Province, The People’s
Republic of China.





The
Company’s Products





Description
of our Lead-Acid Motive Batteries





The key
components of a lead-acid motive battery include electrode plates and fiberglass
dividing plates. The electrode plates are coated with oxidized lead and alloy
lead. Pairs of positively charged electrode plates and negatively charged
electrode plates each separated by a fiberglass dividing plate are bound
together by metal strip and installed into the plastic casing of a lead-acid
motive battery. The battery is then filled with sulfuric acid and charged with
electricity. The number and the size of electrode plates required to be
installed in a lead-acid motive battery will depend on the required level of its
storage capacity and the power output.





We
produce and offer ten (10) models of lead-acid motive battery products for sale
and are mainly engaged in the production of the following models of lead-acid
motive battery products for electric bicycles:





Product
                    
                    Dimentions (LxWxH)
                    
                    Weight
                      (kg)
                    
                    
                    Power
                      Output
                      (w)
                    
                    
                    Estimated
                      Hours
                      Required
                      Per
                      Charging
                      (1)
                    
                    
                    Estimated
                      Minutes
                      of Use
                      Per
                      Charging
                      (min)(2)
                    
                    
                    Estimated
                      Travel
                      Distance Per
                      Charging (km)6-DZM-10Ah
                    
                    151×99×98
                    
                    
                    4.2
                    
                    
                    
                    60
                    
                    
                    
                    10
                    h
                    
                    
                    135-145
                    
                    
                    
                    45-506-DZM-12Ah
                    
                    151×99×102
                    
                    
                    4.3
                    
                    
                    
                    72
                    
                    
                    
                    10
                    h
                    
                    
                    120-130
                    
                    
                    
                    45-506-DZM-16Ah
                    
                    151×99×118
                    
                    
                    5.6
                    
                    
                    
                    96
                    
                    
                    
                    10
                    h
                    
                    
                    120-130
                    
                    
                    
                    50-606-DZM-17Ah
                    
                    181×76×166
                    
                    
                    6.3
                    
                    
                    
                    102
                    
                    
                    
                    10
                    h
                    
                    
                    120-130
                    
                    
                    
                    50-606-DZM-20Ah
                    
                    181×76×170
                    
                    
                    7.0
                    
                    
                    
                    120
                    
                    
                    
                    10
                    h
                    
                    
                    120-130
                    
                    
                    
                    60-708-DZM-16Ah
                    
                    200×100×118
                    
                    
                    7.4
                    
                    
                    
                    128
                    
                    
                    
                    10
                    h
                    
                    
                    120-130
                    
                    
                    
                    60-708-DZM-18Ah
                    
                    250×100×128
                    
                    
                    9.0
                    
                    
                    
                    144
                    
                    
                    
                    10
                    h
                    
                    
                    120-130
                    
                    
                    
                    60-708-DZM-20Ah
                    
                    250×100×128
                    
                    
                    9.05
                    
                    
                    
                    160
                    
                    
                    
                    10
                    h
                    
                    
                    120-130
                    
                    
                    
                    60-706-DZM-24Ah
                    
                    175×165×125
                    
                    
                    9.5
                    
                    
                    
                    144
                    
                    
                    
                    10
                    h
                    
                    
                    120-130
                    
                    
                    
                    70-806-DZM-25Ah
                    
                    250×78×118
                    
                    
                    8.85
                    
                    
                    
                    150
                    
                    
                    
                    10
                    h
                    
                    
                    120-130
                    
                    
                    
                    70-80




5





(1)
Estimated hours required per charging refers to the estimated number of hours
required for charging the battery from nil to full storage
capacity.




(2)
Estimated hours of use per charging refer to the estimated maximum number of
hours for which the battery is able to be used on each occasion when it is
charged to its full storage capacity.





All the
lead-acid motive battery products produced by us are re-chargeable and can be
recharged approximately 500 times. They are standardized and can be used in
electric bicycles, electric motorcycles and electric cars produced by different
manufacturers.





Distribution
Methods





We sell
our lead-acid motive battery products principally to manufacturers of electric
bicycles. However, with the growing retail market for replacement of battery
products, i.e. our secondary market, we have also strengthened our efforts in
the sales of battery products to sales representatives and exclusive
distributors which are strategically located in 27 provinces, autonomous regions
and directly-administered municipalities in China.  The Company
currently has exclusive sales agreements with distributors at the provincial and
county level, and employs sales representatives in each province across China to
help distributors to further distribute products from counties to
towns.  We have established and maintained long-term relationships
with distributors who we believe have local business experience and established
regional sales networks.





Our
largest distributors are located in the cities of Yancheng and Haimen in Jiangsu
Province and in Shanghai.





Market
Share





Zhejiang
is the main province of producing LABEBs, the output of which accounted for
approximately half of the total domestic output of LABEBs in China. According to
the China Battery Industry Association, in 2009, total output of the top five
(5) enterprises operating in Zhejiang accounted for approximately 35 million
LABEBs of the approximate 100 million sold across China in the personal
transportation market.





According
to market research results of China Battery Industry Association, for the year
ended March 31, 2010, our sales of lead-acid battery products in China
represented approximately 11.84% of the total market size (in terms of sales
revenue) of the lead-acid motive battery products for electric bicycles in
China.





The table
below shows the three top manufacturers of LABEBs in China, and their revenues
during fiscal year ended March 31, 2010:





Battery Manufacturer
                    
                    Production Location
                    
                    Revenues in 2010
                      (approximate)
                      US$(Million)
                    
                    
                    Market ShareChaowei
      Power Holdings Limited
                    
                    Changxing,
      Zhejiang
                    
                    
                    338.31
                    
                    
                    
                    22.6
                    %Tianneng Power
      International Limited
                    
                    Changxing,
      Zhejiang
                    
                    
                    330.83
                    
                    
                    
                    22.1
                    %CHISEN
      ELECTRIC CORPORATION
                    
                    Changxing,
      Zhejiang
                    
                    
                    177.19
                    
                    
                    
                    11.8
                    %





Revenues
generated by the Company in China accounted for 100% of the Company’s revenues
in the fiscal years ended March 31, 2010 and 2009.





The
Company’s battery production reached 14.48 million units and 7.8 million units,
respectively for the fiscal years ended March 31, 2010 and
2009.


6





Competitive
Business Conditions and Market Trends





At the
United Nations Climate Change Conference 2009, the Chinese Government announced
that by 2020, greenhouse gas emissions will be reduced by approximately 40% to
45% from 2005’s basis. We believe that in the next several years, due to
intensifying global environmental concerns, there will be increased development
of the electric bicycle. At present, we believe that the development of electric
vehicles has won the support of the Chinese government due to the fact that the
use of electric bicycles is very much in line with the Chinese government’s
energy-saving and environmental protection policies. The electric bicycle, as an
environment-friendly and convenient personal transportation vehicle, bears the
advantages of convenience, non-pollution, safety and less energy consumption.
According to market research results of Adfaith Consulting Co., Ltd., during the
five years from 2004 to 2008, the market sales of electric vehicles in China
tripled, with the number of electric vehicles totaling approximately 100,000,000
units in 2009. In accordance with the measured data of the electric vehicle
market demand in China, it is estimated that the total number of electric
vehicles will exceed 120,000,000 units in 2010.





With
respect to new product trends in the market, Europe, the United States and Japan
use primarily a lithium battery.  It is a general market trend for
companies to develop motive battery products that are more environmentally
friendly with increased power output and less weight. There can be no assurance
that manufacturers of electric bikes will continue to use lead-acid motive
battery products as the principal source of motive power for electric bikes. In
the event that the market prefers to use other forms of battery products and if
we are not able to develop new motive battery products to meet the future
demand, our business could be adversely affected.





In 2009,
the top electric bicycle brand in terms of production was Taimei, followed by
Xinri and Yadea, the only three companies with the sales volume exceeded 900,000
units in 2009 according to a research report issued by Tianjin Bicycle
Association. We believe that continued industrial integration and brand
concentration will continue to increase and that these famous brands in China
will rapidly increase their market share.  We also believe that brands
will become more diversified by an increasing influence of well-known brands on
the market. The Company has established long-term strategic relationships with
important electric bicycle manufacturers, including Xinri, Yadea, Taimei,
Supaiqi. Xinri’s electric bicycle was utilized at the Beijing 2008 Olympic Games
and at the Paralympic Games, which is a great honor in China, and the Company
was chosen as the only manufacturer to supply environmentally friendly batteries
to Xinri for its electric bicycle. The Company is also an alternative power
source sponsor at the 2010 Shanghai World Expo, providing an eco-friendly
solution to power the road signage at select Expo Park locations. Based on this,
in the next several years, we will strive to create an international first-class
brand and become the leader in providing “green” energy in the electric bicycle
marketplace. Simultaneously, through constant research and development of new
chemical energy technologies, we believe the Company will provide energy-savings
and highly-effective energy solutions to our customers for the purpose of
improving the quality of human life and a sustainable ecological
environment.





Competition





Our chief
competitors are Tianneng Power International Ltd. (“Tianneng”) and Chaowei Power
Holdings Limited (“Chaowei”). The two companies were the first companies to
enter the battery industry in China. For example, Chaowei and Tianneng are the
leading companies in terms of production and sales volume, and both accompanies
have many after-sales service stores and take an advantage in the secondary
market by their continued business expansion. Tiannneng and Chaowei’s capital
stocks are listed on The Hong Kong Stock Exchange. The most significant
difference between the Company and its two competitors is that the Company
focuses on the primary market, whereas Tianneng and Chaowei focus on the
secondary market.





Cooperative
Partnership





In April
2008, CCEC set up the Zhejiang Changxing Chisen Physical-Chemical Power Supply
Research and Development Center at the College of Chemistry and Chemical
Engineering at Xiamen University in order to research and develop new products.
Xiamen University is a first class comprehensive University in China with 9
graduate schools, 120 research institutions and cooperative inter-university
ties to over 100 institutions worldwide.





The
Company has also established long-term strategic relationships with important
electric bicycle manufacturers, including Xinri, Yadea and
Taimei.  The Company also established strategic cooperation
partnership with suppliers and vendors by means of supply chain integration to
control procurement cost and quality. Moreover, a supplier’s assessment system
has been set up to ensure the quality stability of direct
materials.


7





Development
Strategy of the Company





With a
leading position in the LABEB battery product market in China, our product
research and development capability and our cooperative partnership, we believe
we are well positioned to capture additional business opportunities in China's
personal transportation device market. In light of those prevailing economic
trends of developing alternative transportation devices, aiming to reduce the
reliance on oil and gas and producing lesser emissions, we intend to explore the
motive battery market for electric-powered motorcycles and electric cars.
Leveraging our experience and expertise in producing lead-acid motive battery
products for electric bicycles, our product mix has been expanded to include
lead-acid back-up batteries, lithium iron motive batteries and lithium iron
back-up battery products. It is our goal to become the largest battery developer
and producer with a first-class sales and service network in China.





The top
five lead-acid motive battery manufacturers in 2009 accounted for over 50% of
the total market share with the Company, representing approximately 11.84% of
the total market share, ranking third in the industry.  The Company
has taken the following measures to set up its position as one of the leaders in
the industry: (1) the Company invested in an automatic production line with the
maximum daily production capacity increasing by 50% compared with that in 2009;
(2) the Company is actively seeking an acquisition target to expand its market
share and develop its production capacity.





Results
of Operations for the Three Months Ended June 30, 2010 Compared with the Three
Months Ended June 30, 2009





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




For The Three Months Ended June 30 (Unaudited)2010
                  
                  
                  2009
                  
                  
                  2010
                  
                  
                  2009Revenues
                  
                  $
                  50,429,000
                  
                  
                  $
                  29,475,000
                  
                  
                  
                  100.00
                  %
                  
                  
                  100.00
                  %Cost
      of sales
                  
                  $
                  45,392,000
                  
                  
                  $
                  24,105,000
                  
                  
                  
                  90.01
                  %
                  
                  
                  81.78
                  %Gross
      income
                  
                  $
                  5,037,000
                  
                  
                  $
                  5,370,000
                  
                  
                  
                  9.99
                  %
                  
                  
                  18.22
                  %Sales,
      marketing and distribution
                  
                  $
                  2,512,000
                  
                  
                  $
                  1,787,000
                  
                  
                  
                  4.98
                  %
                  
                  
                  6.06
                  %General
      and administrative expenses
                  
                  $
                  684,000
                  
                  
                  $
                  1,056,000
                  
                  
                  
                  1.36
                  %
                  
                  
                  3.58
                  %Operating
      income
                  
                  $
                  1,841,000
                  
                  
                  $
                  2,527,000
                  
                  
                  
                  3.65
                  %
                  
                  
                  8.57
                  %Other
      income, net
                  
                  $
                  503,000
                  
                  
                  $
                  147,000
                  
                  
                  
                  1.00
                  %
                  
                  
                  0.50
                  %Interest
      income
                  
                  $
                  96,000
                  
                  
                  $
                  55,000
                  
                  
                  
                  0.19
                  %
                  
                  
                  0.19
                  %Net
      income from operations before interest and
      tax  expenses
                  
                  $
                  2,440,000
                  
                  
                  $
                  2,729,000
                  
                  
                  
                  4.84
                  %
                  
                  
                  9.26
                  %Interest
      expenses
                  
                  $
                  685,000
                  
                  
                  $
                  369,000
                  
                  
                  
                  1.36
                  %
                  
                  
                  1.25
                  %Income
      before income taxes
                  
                  $
                  1,755,000
                  
                  
                  $
                  2,360,000
                  
                  
                  
                  3.48
                  %
                  
                  
                  8.01
                  %Income
      taxes expenses
                  
                  $
                  249,000
                  
                  
                  $
                  355,000
                  
                  
                  
                  0.49
                  %
                  
                  
                  1.20
                  %Net
      income
                  
                  $
                  1,506,000
                  
                  
                  $
                  2,005,000
                  
                  
                  
                  2.99
                  %
                  
                  
                  6.80
                  %Other
      comprehensive income
                  
                  $
                  121,000
                  
                  
                  $
                  1,000
                  
                  
                  
                  0.24
                  %
                  
                  
                  0.00
                  %Comprehensive
      income
                  
                  $
                  1,627,000
                  
                  
                  $
                  2,006,000
                  
                  
                  
                  3.23
                  %
                  
                  
                  6.81
                  %




Revenues





During
the three month period ended June 30, 2010, we kept strong growth in our sales
when compared to the same period in 2009. The Company successfully expanded its
customer base and strengthened its customer relationships. Revenues for the
three month period ended June 30, 2010 and 2009 were US$50,429,000 and
US$29,475,000, respectively. The increase in revenues of 71% was mainly
attributable to an increase in sales volume and an increase in the average unit
selling price of our battery products.





Sales
volume increased by 61% from 2,498,000 units for the three month period ended
June 30, 2009 to 4,017,000 units for the three month period ended June 30,
2010.  The increase in sales volume was mainly attributable to strong
sales volume of our battery products as a result of rapid growth in the electric
bicycle market in the PRC and an increase in the Company’s sales to existing and
new customers. For example, sales to Taimei, a major electric bicycle
manufacturer and a famous brand name in China, increased by 98% for the three
month ended June 30, 2010 as compared to the same period in
2009.


8





The
average unit selling price of our battery products increased by 7% for the three
month period ended June 30, 2010 in response to the increase in the average
costs of our major raw materials.





Cost
of Sales





Cost of
sales for the three month periods ended June 30, 2010 and 2009 was US$45,392,000
and US$24,105,000, respectively, and cost rates were 90% and 82%,
respectively.  The increase in cost rate was mainly attributable to
the Company’s promotional activities and sales discounts and rebates to
customers which were made in order to maintain the Company’s market
competitiveness.  In addition, in response to the 18% increase in the
average cost of raw materials and fierce market competition, the average unit
selling price increased by less than 7% and therefore the cost rate increased by
8%.





Depreciation
and Amortization





Depreciation
and amortization expenses were US$256,000 and US$135,000 for the three month
periods ended June 30, 2010 and 2009, respectively. The increase of US$121,000,
or 89.63%, was mainly attributable to the acquisition of new plant and machinery
and leasehold improvements during the three month period ended June 30, 2010
made in connection with the Company’s business expansion efforts.





Sales,
Marketing and Distribution





Sales,
marketing and distribution expenses were US$2,512,000 and US$1,787,000for the three month
periods ended June 30, 2010 and 2009, respectively.  The increase of
US$725,000, or 40.57%, was mainly driven by the increase in traveling expenses,
after-sale related expenses and the provision for warranty costs by US$464,000,
US$51,000 and US$284,000, respectively.  The increase was partly
offset by a decrease in sales commissions of US$190,000.





General
and Administrative Expenses





General
and administrative expenseswere US$684,000 and
US$1,056,000for
the three month periods ended June 30, 2010 and 2009, respectively, and mainly
consisted of staff salaries and benefits, depreciation expenses, legal and
professional fees, other taxes and promotion and advertising expenses. The
decrease of US$372,000, or 35.23%, was mainly due to the reclassification of
certain expenses to cost of sales and sales, marketing and distribution in order
to more accurately reflect their true nature.





Other
Income, Net





Net other
income was US$503,000 and US$147,000 for the three month periods ended June 30,
2010 and 2009, respectively. The increase of US$356,000, or 242.18%,
was mainly attributable to the increase in net sales of lead to electric plate
suppliers and government subsidies.




In
addition, the available-for-sale financial assets held by the Company increased
to 9,600,000 shares from 6,000,000 shares after receiving a stock dividend in
June, 2010.




Net
Income from Operations before Interest and Tax Expenses





Net
income from operations before interest and tax expense was US$2,440,000 and
US$2,729,000 for the three month periods ended June 30, 2010 and 2009,
respectively. The decrease of US$289,000, or 10.59%, was mainly attributable to
the decrease in operating income of US$686,000, which is attributable to the
increase in cost rate of 8%.





Interest
Expense





Interest
expensewas
US$685,000 and US$369,000for the three month
periods ended June 30, 2010 and 2009, respectively. The increase of US$316,000,
or 85.64%, was mainly attributable to the increase of US$14,849,000 in average
short-term bank loans for the three month period ended June 30,
2010.


9





Net
Income





Net
income was US$1,506,000 and US$2,005,000for
the three month periods ended June 30, 2010 and 2009, respectively. The decrease
in net income of US$499,000, or 24.89%, was mainly attributable to the
decrease of US$1.38
in gross income per unit of sales.





Liquidity
and Capital Resources





The
Company generally finances its operations through profit generated from its
operations and borrowings from banks.  During the reporting period,
the Company entered into a number of bank loans to satisfy its financing needs.
As of the date of this report, we have not experienced any difficulty in raising
funds by bank loans, and we have not experienced any liquidity problems in
settling our payables in the normal course of business and repaying our bank
loans when they fall due.





The
following table sets forth the summary of our cash flows, in U.S. dollars, for
the periods indicated:





Three Months Ended June 30
      (Unaudited)2010
                  
                  
                  2009Net
      cash provided by (used in) operating activities
                  
                  $
                  230,000
                  
                  
                  $
                  (337,000
                  )Net
      cash used in investing activities
                  
                  $
                  (3,940,000
                  )
                  
                  $
                  (4,886,000
                  )Net
      cash provided by financing activities
                  
                  $
                  663,000
                  
                  
                  $
                  11,688,000Net
      (decrease) increase in cash and cash equivalents
                  
                  $
                  (3,047,000
                  )
                  
                  $
                  6,465,000Effect
      of exchange rate changes on cash
                  
                  $
                  24,000
                  
                  
                  $
                  -Cash
      and cash equivalents at beginning of period
                  
                  $
                  6,019,000
                  
                  
                  $
                  2,620,000Cash
      and cash equivalents at end of period
                  
                  $
                  2,996,000
                  
                  
                  $
                  9,085,000





Operating
Activities





Net cash
provided by operating activities was approximately US$230,000 for the three
months ended June 30, 2010, as compared to net cash used in operating activities
of approximately US$337,000 for the same period in 2009. This increase of
US$567,000, or 168.24%, was mainly due to increase in accounts payable and notes
payable and decrease in prepayments, offset by the increase in accounts
receivable and the decrease in accrued expenses.





Investing
Activities





Net cash
used in investing activities was approximately US$3,940,000 for the three months
ended June 30, 2010, as compared to approximately US$4,886,000 for the same
period in 2009. The decrease of US$946,000, or 19.36%, was mainly attributable
to the decrease of US$4,057,000 in additional funds invested in restricted bank
balances for issuing bank acceptance bills, and was partly offset by the
increase of US$1,778,000 in funds used for acquiring available-for-sale
financial assets.




Financing
Activities





Net cash
provided by financing activities was approximately US$663,000 for the three
months ended June 30, 2010, as compared to approximately US$11,688,000 for the
same period in 2009. The decrease of US$11,025,000, or 94.33%, was mainly
attributable to the decrease in additional bank borrowings and bills
financing.





Working
Capital





Our
working capital decreased by approximately US$809,000 to approximately
US$15,952,000 as of June 30, 2010, as compared to our working capital of
approximately US$16,761,000 as of March 31, 2010.  The decrease was
mainly attributable to net effect of increase in current assets of US$6,416,000
and the increase in current liabilities of US$7,225,000. The increase in current
assets was mainly attributable to the increase in restricted bank balances of
US$4,057,000 and accounts receivable of US$20,551,000 while the increase in
current liabilities was mainly due to the increase in accounts payable of
US$9,988,000 and notes payable of US$9,100,000.


10





Off-Balance
Sheet Arrangements




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





ITEM
3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK




Interest
Rates Risk




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





Foreign
Exchange Rates Risk




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





Contractual
Obligations




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




Bank indebtedness (US$)
                                    
                                    June 30, 2010
                                    
                                    
                                    March 31, 2010Short-term
      bank borrowings
                                    
                                    US$
                                    46,990,000
                                    
                                    
                                    US$
                                    46,141,000Notes
      payable (within (1) year)
                                    
                                    US$
                                    37,121,000
                                    
                                    
                                    US$
                                    35,504,000Total
                                    
                                    US$
                                    84,111,000
                                    
                                    
                                    US$
                                    81,645,000
  Purchase Obligations (US$)
                                    
                                    June 30, 2010
                                    
                                    
                                    March 31, 2010Purchase
      of machinery (within one (1) year)
                                    
                                    US$
                                    84,000
                                    
                                    
                                    US$
                                    84,000Total
                                    
                                    US$
                                    84,000
                                    
                                    
                                    US$
                                    84,000
  Operating Lease Obligations (US$)
                                    
                                    June 30, 2010
                                    
                                    
                                    March 31, 2010Within
      one (1) year
                                    
                                    US$
                                    609,000
                                    
                                    
                                    US$
                                    599,0001-3
      years
                                    
                                    US$
                                    1,312,000
                                    
                                    
                                    US$
                                    1,291,0003-5
      years
                                    
                                    US$
                                    434,000
                                    
                                    
                                    US$
                                    604,000Over
      five (5) years
                                    
                                    US$
                                    0
                                    
                                    
                                    US$
                                    0Total
                                    
                                    US$
                                    2,355,000
                                    
                                    
                                    US$
                                    2,494,000
 11


ITEM
4. CONTROLS AND PROCEDURES




Disclosure
Controls and Procedures




Under the
supervision and with the participation of our management, including our
principal executive officer and principal financial officer, we conducted an
evaluation of the effectiveness of the design and operation of our disclosure
controls and procedures, as defined in Rule 13a-15(e) under the Exchange
Act. Based on this evaluation, our management, including our principal executive
officer and our principal financial officer, concluded that our disclosure
controls and procedures were effective as of the fiscal quarter covered by this
report, to ensure that information required to be disclosed by us in the reports
filed or submitted by us under the Exchange Act (i) is recorded, processed,
summarized and reported within the time period specified in SEC rules and forms
and (ii) is accumulated and communicated to our management, including our
principal executive officer and our principal financial officer, as appropriate
to allow appropriate decisions on a timely basis regarding required
disclosure.





Changes In Internal Control over
Financial Reporting




There
were no changes in our internal control over financial reporting that occurred
during our last fiscal quarter that have material affect, or are reasonably
likely to materially affect, our internal control over financial
reporting.





PART
II


OTHER
INFORMATION




ITEM
1. LEGAL PROCEEDINGS




In the
normal course of business, we are named as defendant in lawsuits in which claims
are asserted against us. In our opinion, the liabilities, if any, which may
ultimately result from such lawsuits, are not expected to have a material
adverse effect on our financial position, results of operations or cash flows.
As of June 30, 2010, there was no pending or outstanding material litigation
with the Company.





ITEM
1A. RISK FACTORS




Not
required for a "smaller reporting company".




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




During
the quarter ended June 30, 2010, the Company had no unregistered sales of equity
securities.





ITEM
3. DEFAULTS UPON SENIOR SECURITIES




None.





ITEM
4. SUBMISSION OF MATTERS TO A VOTE OF SECURITYHOLDERS




None.




ITEM
5. OTHER INFORMATION




None.





ITEM
6. EXHIBITS




(a) Exhibits





EXHIBIT NO.
              
              DESCRIPTION
              
              LOCATION2.1
              
              Share
      Exchange Agreement, dated November 12, 2008, by and among World Trophy
      Outfitters, Inc., Fast More Limited, Cheer Gold Development Ltd. and
      Floster Investment Limited
              
              Incorporated
      by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K as
      filed with the SEC on November 12,
2008




12





3.1
              
              Articles
      of Incorporation of World Trophy Outfitters, Inc.
              
              Incorporated
      by reference to Exhibit 3(i).1 to the Registrant’s Registration Statement
      on Form SB-2 as filed with the SEC on September 23,
20053.2
              
              Certificate
      of Amendment to Articles of Incorporation of Chisen Electric Corporation
      (name change)
              
              Incorporated
      by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K as
      filed with the SEC on February 4, 20093.3
              
              Amended
      and Restated Bylaws of Chisen Electric Corporation
              
              Incorporated
      by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K as
      filed with the SEC on February 4, 20093.4
              
              Certificate
      of Incorporation of Fast More Limited, dated December 17,
    2007
              
              Incorporated
      by reference to Exhibit 3.3 to the Company’s Current Report on Form 8-K as
      filed with the SEC on November 12, 20083.5
              
              Memorandum
      and Articles of Association of Fast More Limited, dated as of December 17,
      2007
              
              Incorporated
      by reference to Exhibit 3.4 to the Company’s Current Report on Form 8-K as
      filed with the SEC on November 12, 20083.6
              
              Certificate
      of Incorporation of Changxing Chisen Electric Co., Ltd.
              
              Incorporated
      by reference to Exhibit 3.5 to the Company’s Current Report on Form 8-K as
      filed with the SEC on November 12, 20083.7
              
              Articles
      of Associations of Changxing Chisen Electric Co., Ltd.
              
              Incorporated
      by reference to Exhibit 3.6 to the Company’s Current Report on Form 8-K as
      filed with the SEC on November 12, 200810.1
              
              Agreement
      on Establishment of Changxing Chisen Physical Chemistry Power Research and
      Development Center, dated April 30, 2008
              
              Incorporated
      by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.2
              
              Form
      of Labor Contract
              
              Incorporated
      by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.3
              
              Lease
      Agreement, dated March 30, 2008, by and between Changxing Chisen Electric
      Co., Ltd. and Changxing Xiangyi Industrial Park Investment Co.,
      Ltd.
              
              Incorporated
      by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.4
              
              Contract
      For Loan on Guarantee, by and among Zhejiang Changxing Agricultural
      Cooperative Bank, Changxing Chisen Electric Co., Ltd. and Zhejiang Chisen
      Glass Co., Ltd.
              
              Incorporated
      by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.5
              
              Renminbi
      Loan Contract, dated January 11, 2008, by and between Changxing Chisen
      Electric Co., Ltd. and China Construction Bank Corporation (Changxing
      Branch)
              
              Incorporated
      by reference to Exhibit 10.5 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.6
              
              Renminbi
      Loan Contract, dated April 11, 2008, by and between Changxing Chisen
      Electric Co., Ltd. and China Construction Bank Corporation (Changxing
      Branch)
              
              Incorporated
      by reference to Exhibit 10.6 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.7
              
              Renminbi
      Loan Contract, dated March 31, 2008, by and between Changxing Chisen
      Electric Co., Ltd. and Bank of China (Hong Kong) Limited Shanghan
      Branch
              
              Incorporated
      by reference to Exhibit 10.7 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12,
2008




13





10.8
              
              Loan
      Contract (Short Term), dated August 15, 2008, by and between Changxing
      Chisen Electric Co., Ltd. and Bank of China Changxing
    Branch
              
              Incorporated
      by reference to Exhibit 10.8 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.9
              
              Acceptance
      Agreement, dated August 25, 2008, by and between Changxing Chisen Electric
      Co., Ltd. and Industrial Bank Co., Ltd. Hangzhou Branch
              
              Incorporated
      by reference to Exhibit 10.9 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.10
              
              Acceptance
      Agreement of Commercial Bill, dated September 18, 2008, by and between
      Changxing Chisen Electric Co., Ltd. and China Bank Co., Ltd. Changxing
      Branch
              
              Incorporated
      by reference to Exhibit 10.10 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12,
2008





10.11
                
                Cooperation
      Agreement, dated April 20, 2008, by and between Changxing Chisen Electric
      Co., Ltd. and Xiamen University
                
                Included
      by reference to Exhibit 10.11 to the Company’s Annual Report on Form 10-K
      as filed with the SEC on June 28, 201010.11
                
                Acceptance
      Agreement of Commercial Bill, dated July 29, 2008, by and between
      Changxing Chisen Electric Co., Ltd. and China Construction Bank Changxing
      Branch Co., Ltd.
                
                Incorporated
      by reference to Exhibit 10.11 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.12
                
                Acceptance
      Agreement of Commercial Bill, dated September 9, 2008, by and between
      Changxing Chisen Electric Co., Ltd. and China Construction Bank Changxing
      Branch Co., Ltd.
                
                Incorporated
      by reference to Exhibit 10.12 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.13
                
                Components
      Purchase Contract, effective as of January 1, 2008, by and between
      Changxing Chisen Electric Co., Ltd. and Jiansu Xinri Electric Bicycle Co.,
      Ltd.
                
                Incorporated
      by reference to Exhibit 10.13 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.14
                
                Supply
      Contract, dated April 22, 2008, by and between Changxing Chisen Electric
      Co., Ltd. and Jiangsu Yadea Science & Technology Development Co.,
      Ltd.
                
                Incorporated
      by reference to Exhibit 10.14 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.15
                
                Sales
      Contract of Battery, dated November 10, 2007, by and between Changxing
      Chisen Electric Co., Ltd. and Hu Qinzhong, Yancheng Office
                
                Incorporated
      by reference to Exhibit 10.15 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200810.16
                
                Sales
      Contract of Battery, dated February 17, 2008, by and between Changxing
      Chisen Electric Co., Ltd. and Song Chunwei
                
                Incorporated
      by reference to Exhibit 10.16 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200814.1
                
                Code
      of Ethics
                
                Incorporated
      by reference to Exhibit 14.1 to the Company’s Current Report on Form 8-K
      as filed with the SEC on February 4, 200917
                
                Resignation
      of Mathew Evans, dated November 12, 2008
                
                Incorporated
      by reference to Exhibit 17 to the Company’s Current Report on Form 8-K as
      filed with the SEC on November 12, 200821
                
                List
      of Subsidiaries
                
                Included
      by reference to Exhibit 21 to the Company’s Annual Report on Form 10-K as
      filed with the SEC on June 28,
2010


14




31.1
              
              Certifications
      of the Chief Executive Officer pursuant to Section 302 of the
      Sarbanes-Oxley Act of 2002
              
              Provided
      herewith31.2
              
              Certifications
      of the Chief Financial Officer pursuant to Section 302 of the
      Sarbanes-Oxley Act of 2002
              
              Provided
      herewith32.1
              
              Certification
      Pursuant To 18 U.S.C. Section 1350, As Adopted Pursuant To Section 906 of
      the Sarbanes-Oxley Act Of 2002
              
              Provided
      herewith





32.2
              
              Certification
      Pursuant To 18 U.S.C. Section 1350, As Adopted Pursuant To Section 906 of
      the Sarbanes-Oxley Act Of 2002
              
              Provided
      herewith99.1
              
              Audited
      Consolidated Financial Statements of Fast More Limited and its Subsidiary
      for the Fiscal Years Ended March 31, 2008 and 2007
              
              Incorporated
      by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200899.2
              
              Unaudited
      Condensed and Consolidated Financial Statements of Fast More Limited and
      its Subsidiary for the Three (3) Months Ended June 30, 2008 and
      2007
              
              Incorporated
      by reference to Exhibit 99.2 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200899.3
              
              Unaudited
      Pro Forma Financial Statements of Fast More Limited for the three (3)
      month period ended June 30, 2008 and the two years ended March 31,
      2008.
              
              Incorporated
      by reference to Exhibit 99.3 to the Company’s Current Report on Form 8-K
      as filed with the SEC on November 12, 200899.4
              
              Audit
      Committee Charter, dated January 15, 2009
              
              Incorporated
      by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K
      as filed with the SEC on February 4, 200999.5
              
              Compensation
      Committee Charter, dated January 15, 2009
              
              Incorporated
      by reference to Exhibit 99.2 to the Company’s Current Report on Form 8-K
      as filed with the SEC on February 4, 200999.6
              
              Corporate
      Governance and Nominating Committee Charter, dated January 15,
      2009
              
              Incorporated
      by reference to Exhibit 99.3 to the Company’s Current Report on Form 8-K
      as filed with the SEC on February 4,
2009




15


SIGNATURES




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


Date: August
      16, 2010
              By:
              /s/ Xu KechengName:
      Xu KechengIts:
      President, Chief Executive Officer and
                Principal
      Executive Officer





Date: August
      16, 2010
              By:
              /s/Liu ChuanjieName:
      Liu ChuanjieIts:
      Chief Financial Officer, Principal
                Financial
      and Accounting Officer




16