The intermediate materials marketplace is often neglected in favor of the end-product people understand. Most investors just feel more comfortable with their basic understanding of the product they are investing in. What they are missing, however, are the companies that supply the materials and processes needed to manufacture the end-product. Investing in the means to the end can be a lucrative move, if one can find those hidden companies that make the end-product come to life in the first place.

China Gengsheng Minerals Inc., an advanced materials manufacturer with corporate offices in the British Virgin Islands, works to manufacture and market materials primarily to the steel and oil industries of China. A recent acquisition has also added fine abrasives to the company’s product offerings.

China Gengsheng Minerals operates primarily is China, but serves over 200 customers worldwide. Although the company is currently pursuing additional markets in somewhat similar areas, its primary customer base is directed toward the high temperature steel and iron, glass, oil, cement and chemical markets. The company’s high temperature vessel products enable high temperature material manufacturers, such as steel and iron manufacturers, to operate equipment in harsh environments without fear that a high heat environment will degrade sensitive equipment.

In recent quarters, the company has also been making excellent progress in expanding its customer base. Three major Chinese oil companies have signed China Gengsheng Minerals as a fractured proppant supplier (fractured proppants are a fine grained bauxite-based mineral for increasing oil and gas yields.) The company indicates that these contracts will amount to $5.3 million through the end of 2008. Abrasives also became a new part of the company’s activities in 2008 with the second quarter purchase of Qiandongnanzhou Xinyu Abrasives Company Ltd. The acquisition will shore up supply of brown fused alumina, found in 18% of the company’s product mix, while also expanding its presence in the fine silica abrasives market.

From all appearances, the company has established itself in China’s domestic infrastructure and forward planning strategy program (China’s much hailed 5 year assessment and planning program.) As China continues its infrastructure program and investigates new sources of green energy, such as solar power, China Gengsheng Minerals is likely to be right in the middle of all activities to supply the intermediates needed to get the job done.

Let us hear your thoughts below:

Last 5 posts by QualityStocks

• American Jianye Greentech Holdings, Inc. (AJGH.OB) Expands Into NE China with New Clean Fuels Production Facility - March 12th, 2010
• Provectus Pharmaceuticals, Inc. (PVCT.OB) Brings in $7.5M in a Private Placement - March 12th, 2010
• Beacon Equity Research Featured Company: The Mundus Group, Inc. (MNDP.PK) - March 12th, 2010
• Beacon Equity Research Featured Company: Medical Connections Holdings, Inc. (MCTH.OB) - March 12th, 2010
• Cytta Corp. (CYCA.OB) Announces Enhanced Leadership with Appointment of Industry Veterans - March 12th, 2010