Puda Coal, Inc. (OTCBB: PUDC)

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Puda Cole Inc

Symbol: NASDAQ OTCBB: PUDC

Address:
Puda Coal, Inc.
426 Xuefu Street
Taiyuan, Shanxi Province
China

Investor Relations:
Justin K. Davis
jd@keatinginvestments.com
Phone: Toll Free (888) 850-PUDC
Phone: (720) 489-5804
Fax: (720) 889-0135

www.puda-coal.com

Top 10 Investment Highlights

Puda Coal is a leading supplier of China's highest grade metallurgical coking coal, an essential component in the production of steel.
Puda's revenue increased by 162% from $19.7 million in 2004 to $51.7 million in 2005.
Puda expects revenue to more than double again in 2006.
Puda reported operating income for 2005 of $9.2 million -- a 65% increase over 2004.
China's increasing need for coking coal is based on the rapid growth of China's production and consumption of steel - China is already the world leader in both categories, and real demand continues to increase.
In order to keep pace with this overwhelming demand, Puda has increased production capacity by 440% since October 2005, from 500,000 metric tons (MT) to today's 2.7 million MT.
Operating at full production capacity with a selling price of $77 per MT of cleaned coal, Puda's revenue would be in excess of $210 million.
As a result of its dramatic capacity expansion, Puda is now the largest producer of cleaned coking coal in the booming Shanxi Province, the heart of the Chinese coal industry. Shanxi Province accounts for 20% to 25% of China's coal output and 50% of China's coke production.
The largest coke and steel producers in China prefer to source their cleaned coal from suppliers able to deliver consistently on high volume, high quality orders; with Puda's significantly expanded capacity, the Company can and is now attracting and securing these bigger, more stable and lucrative contracts.
Puda enjoys a strong competitive advantage as one of Shanxi's lowest average cost producers because of its assured sources of raw coal, processing know-how, modern operating efficiencies and location.

Corporate Overview

Puda Coal is a leading supplier of China's highest grade metallurgical coking coal, which is used to make coke for steel manufacturing. Puda Coal does not own or operate coal mines; Puda sources raw coal from independent mines, and through a valueadded washing process, produces high grade cleaned coking coal. Raw coal is crushed, prepared and cleaned using watersupported technology, then processed into coking coal. Puda's state of the art cleaning facilities are located in the Shanxi province of China, which currently provides 20-25% of China's coal output and supplies nearly 50% of China's coke. At the end of Q1 2006, Puda Coal expanded its cleaned coal capacity by 1.2 million MT to 2.7 million MT per year, making it the largest cleaned coking coal supplier in Shanxi Province.

Puda has seen rapid organic growth, with reported revenues of $51.7 million for the year ended December 31, 2005, a 162% increase over 2004. Puda expects revenue to more than double in 2006.

Puda has long-term business relationships with established customers, including coking companies and steel mills with their own coking facilities (e.g., Baotou Steel and Iron Group Co., Ltd. -- the 17th largest steel maker in China) and has signed supply contracts and indications of interest exceeding planned capacity from some of China's largest steel and chemical makers.

China's Increasing Demand For Coal

China's growing economy needs steel, and there can be no steel without coal. With China's 2005 real GDP growth of 9.5%, the Chinese Industrial Revolution continues to grow at an unprecedented pace. Construction in 2005 was up 30% and doesn't show any signs of slowing down. In fact, China is projected to build 520 million meters of floor space annually from 2002-2020 (Source: U.S. Commercial Service). Accordingly, China's steel industry is growing at a rapid pace as well, up 28% in 2005. Already the largest consumer and producer of steel in the world, China's sizzling steel industry will get a further boost from the Western Development policy, the Beijing 2008 Olympics, and the construction and development of a deepwater seaport and its accompanying city at an island near Shanghai. As the demand for quality coking coal is tied to the demand for steel, Puda Coal is perfectly positioned to exploit China's rapidly growing demand for quality coking coal.

The Shanxi province has begun to consolidate this sector, shutting down these smaller mines with less than 300,000 MT output per year in order to streamline coal production and processing facilities. With stricter environmental regulations and efficiency requirements, only the large and technologically sophisticated companies will survive.

Competitive Advantage

Puda enjoys a strong competitive advantage as one of Shanxi's lowest average cost producers because of its large capacity, processing know-how, facility operating efficiencies and location in Shanxi's Liulin County – a region whose coal is known as China's "King of Coal." Puda Coal, Inc. does not own or operate a coal mine, but sources its coal from 13 mines in Liulin County, including those operated by Jucai Coal Industries. Jucai Coal is 75% controlled by Yao Zhao, Puda's Chief Operating Officer. Puda's relationship to Jucai provides the company with ready access to coking coal at a competitive price. Jucai Coal controls about 60% of Liulin County's top grade coal deposits and produces about 50% of high grade coking coal. Jucai's annual production of coking coal increased from 500,000 MT to around 800,000 MT in 2005 and is expected to reach over 1 million MT in 2006.

Capacity Expansion

Puda is expanding its operations rapidly. Recently, the company announced that its newest and largest coal cleaning facility, Zhongyang Plant, has now begun formal production and is already operating at 84% capacity, or approximately 2,800 MT of cleaned coal a day.

Management

Zhao Ming, Chairman and Chief Executive Officer
Mr. Zhao Ming is a co-founder and has been the CEO and Chairman of Puda since 1995. He served as Vice President of Administration at the Fire Department of Taiyuan City from 1994 to 1997. Mr. Zhao graduated from Nanjing Armed Police Forces Command College of China in 1994 with a bachelor's degree in management.

Zhao Yao, Chief Operating Officer
Mr. Zhao Yao is a co-founder of Puda and is the brother of Mr. Zhao Ming. He was named Chief Operating Officer in 1999. He also serves as an executive officer and is the 75% owner of Jucai Coal. Mr. Zhao graduated from the University of Shanxi in Taiyuan City, Shanxi Province in 1982 with a bachelor's degree in coal study. He received his master's degree in coal study from Tsinghua University in Beijing in 1985. He received the Distinguished Entrepreneur award from the Shanxi provincial government in 2002.

This corporate profile is based upon information provided by management of Puda Coal, Inc. The information contained herein is not intended to be, and shall not constitute, an offer to sell or solicitation of any offer to buy any security. It is intended for information only, and to increase awareness of Puda Coal, Inc. products. Some statements may contain so-called "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and the Section 21E of the Securities Exchange Act of 1934. The Private Securities Litigation Reform Act of 1995 provides a safe arbor for forward-looking statements made herein. These forwardlooking statements are not historical facts, but reflect current expectations, estimates and projections. No assurance is given that these estimates, expectations or projections will be achieved. Many factors could cause actual results to differ. Investors should consult with their investment advisor, attorneys and other professionals concerning any stock transaction. Before investing in any security, you are strongly advised to review all public filings of the issuer of such security, which can be found at www.sec.gov, as well as the warnings published by the Securities and Exchange Commission at http://www.sec.gov/investor.shtml. Puda Coal, Inc. has paid a fee to Equities Global Communications, LLC ("EGC"). EGC may buy or sell common stock, in open market or private transactions, at any time, including during the time this corporate profile is distributed.