Major Shareholder:

• Mr. Chan Ka Wo - 34.64% interest
• Pine Technology (8013) - 10.27% interest

Company Subsidiary:

• Zetta Media (100%): Development of software and solutions for mobile appliances in South Korea
• Zetta Global Ltd (100%): Development of software for mobile applications in HK
• Hanbit I&T (HK) Co. Ltd (100%): Sales and marketing of mobile appliances in HK

The Group is principally engaged in the provision of customized solutions for cellular phones. The Group's clients are mainly cellular phone companies in the PRC. The corporate mission of the Group is to become one of the major solutions providers in the Asia Pacific region for mobile telecommunication appliances by creating innovative ideas and applying 2.5G and 3G technologies.

The Group's business strategy is to focus on the provision of various cellular phone solutions in relation to the mobile telecommunication market of the PRC, in particular cellular phone solutions for CDMA 95A/B and its advanced version CDMA2000 1xnetwork which support higher quality signal and allow faster data transmission as compared to GSM network. In order to make the most of its asset in having human resources with specialties in the area of sales and marketing, software development in the mobile telecommunication industry and technical know-how of the development of CDMA cellular phone software.

The Group supplies CDMA solutions and GSM solutions. Cellular phone components soured by the Group include handset case, assembled PCB, LCD unit, battery, antenna and charger. Technical support services offered by the Group include the provision of technical information and cellular phone sample solutions to clients for the manufacture of cellular phones, assisting clients in obtaining cellular phone certification from the PRC authorities, carrying out cellular phone testing and the provision of training sessions to clients' technicians.

For the year ended 31 December 2001, the Group sourced cellular phone components from two hardware houses in South Korea. As to the software side of business, the Group focused on software engineering design and relied on the Korea Programming Team and the Shenzhen Support House for the performance of some of the programming tasks and field testing tasks respectively. The Group established Zetta Korea in August 2001.

The Directors believe that the Group has the following competitive advantages:

• the Group focuses it future development on the CDMA2000 1x mobile telecommunication market in the PRC which ia a new market with limited supply of related products and thus will be easier for the Group to establish a market presence and secure a market position;
• the Group has the advantage of establishing an early presence in the cellular phone solutions business in the PRC;
• the Directors have in-depth knowledge in the mobile telecommunication market in the PRC and South Korea which will assist the introduction of the CDMA2000 1x technology from South Korea to the PRC;
• given the strong technical background of the Directors and the Group's software and solution development team in South Korea, a country that have been operating CDMA 95A/B network since 1996 and CDMA2000 1x since 2000.

• Limited operating history;
• Reliance on limited number of clients;
• Reliance on Shenzhen Support House to provide technical support services;
• Sustainability of revenue;
• Unproven business model;

The business strategies of the Group for the Business Plan Period comprise solutions developments, expansion of sales and marketing capability and expansion of technical support capability.

The Group has entered into 12 cellular phone solution contracts during the Track Record Period and the period from 1 January 2002 to the Latest Practicable Date. To capitalize on its knowhow in providing solutions for mobile telecommunication appliances, the Directors intend to develop solutions for CDMA2000 1x cellular phones, PDA phones, Video Telephony and SMART phones during the Business Plan Period. These new cellular phone solutions will be compatible with the CDMA2000 1x network and will be targeted at cellular phone companies mainly in the PRC. To enhance its sales and marketing capability, the Group plans to establish sales offices in Beijing, Singapore and the U.S.

To enhance the quality of its technical support service and its capability in developing customized cellular phone solutions for PRC clients, the Group plans to establish representative offices in Shenzhen and Shanghai and form a solution development team in the representatives offices in Shenzhen. The Directors are of the view that the pursuit of these pans will improve the Group's technical support services and the quality of tis customized cellular phone solutions, which will eventually enhance the Group's competitive advantage over its competitors.

The net proceeds from the Placing, after deducting the related expenses, are estimated to amount to approximately HK$45.1 million (based on the offer price HK$0.65 per share). The Group at present intends to apply the net proceeds as follows: