Mark Tobin, Senior Research Analyst , (949) 720-5775

mtobin@roth.com
Brian Post, CFA, Research Associate , (949) 720-7178
bpost@roth.com
Sophia Yu, Research Associate , (86)(21) 6141-5757
syu@roth.com
Sales (800) 933-6830, Trading (800) 933-6820

COMPANY NOTE | CHINA RESEARCH | November 16, 2010

Global Energy & Industrials: China

China Ritar Power Corp. | CRTP - $2.95 - NASDAQ | Buy
Estimates Changed, Target Price Changed

Stock Data CRTP: 3Q10 Results Weak; Lowering Est and

52 Week Low - High $2.65 - $5.89 PT; Maintain BUY
Shares Out. (mil) 21.86
Mkt. Cap.(mil) $64.5 Q3 results. Revenue decreased 4.8% y/y to $31.6mm vs. est. $39.8mm.
3-Mo. Avg. Vol. 92,708 Operating income equaled $2.6mm vs. est. $4.2mm. Net income equaled
12-Mo.Price Target $4.50 $1.7mm, or $0.08 per share, vs. est. $3.0mm, or $0.14 per share.
Cash (mil) $10.7
Tot. Debt (mil) $4.6
Management attributed the weak results to increased costs, delayed
Est. 3Yr. EPS Growth 30% shipments, and RMB appreciation.

EPS ($)
Segment results (% of sales): UPS: $12.3mm (39% of total) vs. est.
Yr Dec 2009 —2010E— —2011E— $13.1mm; Telecom: $7.9mm (25%) vs. est. $11.7mm; Renewable: $8.5mm
Curr Prev Curr Prev (27%) vs. est. $11.1mm; LEV: $2.8mm (9%) vs. est. $3.4mm.
1Q 0.03A 0.07A 0.07A 0.07E 0.09E
2Q 0.09A 0.10A 0.10A 0.13E 0.16E
Gross margin pressure. Q3 gross margin equaled 16.4% vs. est. 17.5%.
3Q 0.17A 0.08A 0.14E 0.14E 0.20E Downside was attributable to increased raw material costs, low capacity
4Q 0.15A 0.08E 0.11E 0.11E 0.15E utilization, and RMB appreciation. We believe these drivers will persist and
YEAR 0.45A 0.34E 0.43E 0.45E 0.60E expect margins will remain pressured for the near-term.
P/E 6.6x 8.7x 6.9x 6.6x 4.9x

Revenue ($ millions)
Hengyang expansion update. The second phase of Hengyang expansion is
expected be completed and expects to begin installing equipment during Q4.
Yr Dec 2009 —2010E— —2011E— Recall, in August the Company indicated that one building (of five total) was
Curr Prev Curr Prev completed and equipment installation had begun on 2 (of 10) of new
1Q 16.4A 24.8A 24.8A 27.2E 29.4E production lines, with production expected to commence in late 2010. The
2Q 21.3A 33.6A 33.6A 37.5E 41.8E
remaining eight lines are slated to start trial production 2H2011. We do not
view this expansion as a pacing item for growth, since CRTP is not currently
3Q 33.9A 31.5A 39.8E 39.7E 48.0E
capacity-constrained (~80% utilization during Q3).
4Q 25.9A 29.6E 33.3E 34.3E 40.3E
YEAR 97.5A 119.5E 131.5E 138.7E 159.5E
TDL Power Technology acquisition. As expected, management indicated
2009 Annual: Revenue figures adjusted to reflect divestiture of operating
subsidiary in 2010. that the TDL acquisition is relatively small, suggesting total consideration of
under $1 million. TDL is estimated to generate approximately $3mm in
annual revenue.
1 Year Price History/Ave. Daily Vol for CRTP
6
5 Lowering estimates and price target. We are lowering our estimates to
4 reflect Q3 results and our tempered outlook. We are also lowering our PT to
3 $4.50 (from $6.00), primarily reflecting our decreased estimates.
2
Q3 Q1 Q2 Q3
2010 2011 Maintain BUY; shares offer deep value. Trading at 6.8x our 2011 EPS
estimates and 1.0x tangible book value ($2.85/share), we believe shares of
CRTP reflect deep value. We maintain our BUY rating.
Created by BlueMatrix

Refer to important disclosure information and rating System Definition on pages 4 - 5 of this report. Regulation Analyst Certification ("Reg AC"): The
research analyst primarily responsible for the content of this report certifies the following under Reg AC: I hereby certify that all views expressed in this report
accurately reflect my personal views about the subject company or companies and its or their securities. I also certify that no part of my compensation was, is or
will be, directly or indirectly, related to the specific recommendations or views expressed in this report.

Roth Capital Partners, LLC | 24 Corporate Plaza | Newport Beach CA 92660 | 949 720 5700 | Member FINRA/SIPC
China Ritar Power Corp. China Company Note - November 16, 2010

VALUATION

Our $4.50 price target is based on a 10.0x multiple applied to our FY11 EPS estimate of $0.45. This multiple
reflects a slight discount to the peer group, which trades at 10.5x.

Factors that would impede the stock from achieving our target price include the inability to generate increased
orders, increased competition or pricing pressure, or a decline in end-market demand.

RISKS

Environmental regulations. Changes in government regulations may directly impact the company's
operations and impact its financial results. Lead is a hazardous material and may present health and
environmental risks, if not handled properly. Although the company is in compliance with government
regulations, future changes in environmental laws and worker's health protection regulations may substantially
increase CRTP's operating costs.

International risks. The company sells its products into international markets, which presents risks
associated with trade regulations, foreign currency exchange rates, and political uncertainties. The changes in
governmental policies increased operating costs across the lead-acid battery industry.

Customer concentration. A substantial portion of the company's revenue is derived from a limited number of
customers. Over 40% of CRTP's revenue during the past three years was derived from its ten largest
customers. Loss of one or more of these customers could substantially impact the company's financial results.

Supplier concentration. The company relies on a limited number of suppliers for its raw materials and
components. Disruption of any of these relationships could adversely impact the company's operations and
financial results.

COMPANY DESCRIPTION
China Ritar Power Corporation designs, develops, manufactures and markets environmentally friendly
lead-acid batteries with a wide range of applications and capacities. Ritar sells, markets and services six
series and 197 models of Ritar-branded, cadmium-free valve-regulated lead-acid or VRLA batteries. The
company's batteries are used in a variety of applications, including interruptible power supplies,
telecommunications, renewable energy, and light electric vehicles.

MENTIONED COMPANIES

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China Ritar Power Corp. China Company Note - November 16, 2010

China Ritar Power Corp

Income Statement ($ 000)
F2006A F2007A F2008A Mar-09A Jun-09A Sep-09A Dec-09A F2009A Mar-10A Jun-10A Sep-10A Dec-10E F2010E Mar-11E Jun-11E Sep-11E Dec-11E F2011E F2012E
Revenue 40,933 73,347 112,312 16,384 21,330 33,910 25,860 97,483 24,808 33,554 31,548 29,575 119,486 27,165 37,489 39,688 34,328 138,670 151,710
Cost of sales 32,646 57,966 90,013 13,091 17,242 27,555 20,651 78,540 20,038 28,062 26,384 24,582 99,066 22,508 30,741 32,607 28,338 114,195 124,222

Gross profit 8,287 15,381 22,299 3,293 4,088 6,354 5,209 18,943 4,770 5,492 5,164 4,994 20,420 4,657 6,747 7,081 5,989 24,475 27,487

Operating expenses:
Salaries 622 5,024 5,225 395 526 412 638 1,971 566 571 623 592 2,351 598 637 595 618 2,448 2,525
Sales commissions 507 1,236 1,566 749 177 211 460 1,597 532 260 468 444 1,703 462 525 516 412 1,915 1,944
Other selling, general, and admin expenses 2,473 4,858 6,370 1,205 1,086 1,506 839 4,635 1,444 1,406 1,447 1,420 5,717 1,480 1,668 1,607 1,528 6,284 6,873

Operating income 4,685 4,263 9,137 943 2,299 4,226 3,272 10,740 2,229 3,255 2,625 2,539 10,648 2,117 3,917 4,363 3,432 13,828 16,145

Other income (expense) (419) (861) (884) (138) (101) (178) (81) (498) (173) (289) (448) (175) (1,086) (175) (175) (175) (175) (700) (700)

Income from continuing ops before tax 4,266 3,401 8,254 805 2,198 4,048 3,191 10,242 2,056 2,966 2,177 2,364 9,563 1,942 3,742 4,188 3,257 13,128 15,445
Income tax expense (353) (785) (2,400) (117) (411) (787) (633) (1,948) (471) (690) (487) (591) (2,239) (485) (936) (1,047) (814) (3,282) (3,861)

Income from continuing operations 3,913 2,617 5,853 688 1,787 3,261 2,558 8,294 1,585 2,276 1,689 1,773 7,323 1,456 2,807 3,141 2,443 9,846 11,584

Minority interest share profit (loss) (51) 26 30 8 0 2 1 11 0 0 0 0 0 0 0 0 0 0 0

Income (loss) from discontinued ops 0 0 (719) (154) 0 0 534 380 0 0 0 0 0 0 0 0 0 0 0

Net income 3,862 2,642 5,164 542 1,787 3,263 3,093 8,685 1,585 2,276 1,689 1,773 7,323 1,456 2,807 3,141 2,443 9,846 11,584

Fully diluted GAAP EPS $0.33 $0.14 $0.27 $0.03 $0.09 $0.17 $0.15 $0.45 $0.07 $0.10 $0.08 $0.08 $0.34 $0.07 $0.13 $0.14 $0.11 $0.45 $0.51

Adjustments:
Add: stock-based comp (make-good provision) 0 3,853 3,852 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

Non-GAAP net-income 3,862 6,496 7,896 696 1,787 3,263 3,093 8,685 1,585 2,276 1,689 1,773 7,323 1,456 2,807 3,141 2,443 9,846 11,584

Fully diluted non-GAAP EPS $0.33 $0.34 $0.41 $0.04 $0.09 $0.17 $0.15 $0.45 $0.07 $0.10 $0.08 $0.08 $0.34 $0.07 $0.13 $0.14 $0.11 $0.45 $0.51
Fully diluted weighted average shares outstanding 11,695 18,866 19,128 19,133 19,135 19,379 20,124 19,282 21,715 21,787 21,859 21,900 21,784 22,000 22,000 22,000 22,000 22,000 22,500

EBITDA 4,268 3,797 8,254 805 2,198 4,048 3,191 10,242 2,056 2,966 2,177 2,364 9,563 1,942 3,742 4,188 3,257 13,128 15,445

Margin Analysis
Gross margin 20.2% 21.0% 19.9% 20.1% 19.2% 18.7% 20.1% 19.4% 19.2% 16.4% 16.4% 16.9% 17.1% 17.1% 18.0% 17.8% 17.4% 17.6% 18.1%
Salaries 1.5% 6.8% 4.7% 2.4% 2.5% 1.2% 2.5% 2.0% 2.3% 1.7% 2.0% 2.0% 2.0% 2.2% 1.7% 1.5% 1.8% 1.8% 1.7%
Sales commissions 1.2% 1.7% 1.4% 4.6% 0.8% 0.6% 1.8% 1.6% 2.1% 0.8% 1.5% 1.5% 1.4% 1.7% 1.4% 1.3% 1.2% 1.4% 1.3%
Other selling, general, and admin expenses 6.0% 6.6% 5.7% 7.4% 5.1% 4.4% 3.2% 4.8% 5.8% 4.2% 4.6% 4.8% 4.8% 5.5% 4.5% 4.1% 4.5% 4.5% 4.5%
EBITDA margin 10.4% 5.2% 7.3% 4.9% 10.3% 11.9% 12.3% 10.5% 8.3% 8.8% 6.9% 8.0% 8.0% 7.1% 10.0% 10.6% 9.5% 9.5% 10.2%
GAAP operating margin 11.4% 5.8% 8.1% 5.8% 10.8% 12.5% 12.7% 11.0% 9.0% 9.7% 8.3% 8.6% 8.9% 7.8% 10.4% 11.0% 10.0% 10.0% 10.6%
Non-GAAP operating margin 11.4% 11.1% 11.6% 5.8% 10.8% 12.5% 12.7% 11.0% 9.0% 9.7% 8.3% 8.6% 8.9% 7.8% 10.4% 11.0% 10.0% 10.0% 10.6%
Pretax margin 10.4% 4.6% 7.3% 4.9% 10.3% 11.9% 12.3% 10.5% 8.3% 8.8% 6.9% 8.0% 8.0% 7.1% 10.0% 10.6% 9.5% 9.5% 10.2%
Net margin 9.4% 3.6% 4.6% 3.3% 8.4% 9.6% 12.0% 8.9% 6.4% 6.8% 5.4% 6.0% 6.1% 5.4% 7.5% 7.9% 7.1% 7.1% 7.6%
Tax rate 8.3% 23.1% 29.1% 14.5% 18.7% 19.4% 19.8% 19.0% 22.9% 23.3% 22.4% 25.0% 23.4% 25.0% 25.0% 25.0% 25.0% 25.0% 25.0%

Y/Y Percent Change

Sales 79.4% 79.2% 53.1% -14.9% -30.8% -6.6% -0.2% -13.2% 51.4% 57.3% -7.0% 14.4% 22.6% 9.5% 11.7% 25.8% 16.1% 16.1% 9.4%
EBITDA 255.4% -11.0% 117.3% -12.9% -8.5% 27.1% 83.2% 24.1% 155.4% 34.9% -46.2% -25.9% -6.6% -5.6% 26.2% 92.4% 37.8% 37.3% 17.6%
GAAP operating income 253.6% -9.0% 114.4% -29.0% -18.0% 21.9% 112.6% 17.5% 136.3% 41.6% -37.9% -22.4% -0.9% -5.0% 20.3% 66.2% 35.2% 29.9% 16.8%
Non-GAAP operating income 253.6% 73.2% 60.0% -58.8% -39.0% -4.6% 30.8% -17.3% 136.3% 41.6% -37.9% -22.4% -0.9% -5.0% 20.3% 66.2% 35.2% 29.9% 16.8%
Pretax income 255.3% -20.3% 142.7% -12.9% -8.5% 27.1% 83.2% 24.1% 155.4% 34.9% -46.2% -25.9% -6.6% -5.6% 26.2% 92.4% 37.8% 37.3% 17.6%
GAAP net income 263.8% -31.6% 95.4% 1.5% 2.9% 35.4% 540.6% 68.2% 192.5% 27.4% -48.2% -42.7% -15.7% -8.1% 23.3% 85.9% 37.8% 34.4% 17.6%
Non-GAAP net income 263.8% 68.2% 21.6% -53.5% -33.8% -3.3% 170.9% 10.0% 127.8% 27.4% -48.2% -42.7% -15.7% -8.1% 23.3% 85.9% 37.8% 34.4% 17.6%
GAAP EPS 264.5% -57.6% 92.8% 3.6% 5.0% 36.4% 521.4% 66.8% 157.7% 11.9% -54.1% -47.3% -25.4% -9.3% 22.1% 84.7% 37.2% 33.1% 15.0%
Non-GAAP EPS 263.8% 4.3% 19.9% -52.6% -32.4% -2.5% 162.7% 9.1% 100.7% 11.9% -54.1% -47.3% -25.4% -9.3% 22.1% 84.7% 37.2% 33.1% 15.0%
Shares outstanding 0.0% 61.3% 1.4% -2.0% -2.1% -0.7% 3.1% 0.8% 13.5% 13.9% 12.8% 8.8% 13.0% 1.3% 1.0% 0.6% 0.5% 1.0% 2.3%

Source: Company filings and Roth Capital Partners estimates

Mark Tobin
mtobin@roth.com
(949) 720-5775

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China Ritar Power Corp. China Company Note - November 16, 2010

Disclosures:
Within the last twelve months, ROTH has received compensation for investment banking services from China Ritar Power
Corp.
ROTH makes a market in shares of China Ritar Power Corp. and as such, buys and sells from customers on a principal
basis.
ROTH and/or its employees, officers, directors and owners own options, rights or warrants to purchase shares of China
Ritar Power Corp. stock.
Within the last twelve months, ROTH has managed or co-managed a public offering for China Ritar Power Corp.

On September 28, 2010, ROTH changed its rating system in order to replace the Hold rating with Neutral.

Rating and Price Target History for: China Ritar Power Corp. (CRTP) as of 11-15-2010
02/15/08 11/13/08 03/04/09 06/15/09 08/05/09 03/08/10 05/19/10 08/16/10
I:NR:NA B:$3.5 B:$3 B:$5 B:$8 B:$7 B:$6.5 B:$6

15

12

0
Q3 Q1 Q2 Q3 Q1 Q2 Q3 Q1 Q2 Q3
2008 2009 2010 2011

Created by BlueMatrix

Each box on the Rating and Price Target History chart above represents a date on which an analyst made a change to a
rating or price target, except for the first box, which may only represent the first note written during the past three years.
Distribution Ratings/IB Services shows the number of companies in each rating category from which Roth or an affiliate
received compensation for investment banking services in the past 12 month.

Distribution of IB Services Firmwide

IB Serv./Past 12 Mos.
as of 11/16/10
Rating Count Percent Count Percent
Buy [B] 187 69.0 41 21.9
Neutral [N] 81 29.9 5 6.2
Sell [S] 3 1.1 0 0
Not Rated [NR] 0 0.0 0 0

Our rating system attempts to incorporate industry, company and/or overall market risk and volatility. Consequently, at any
given point in time, our investment rating on a stock and its implied price movement may not correspond to the stated
12-month price target.

Ratings System Definitions - ROTH employs a rating system based on the following:
Buy: A security, which at the time the rating is instituted and or reiterated, indicates an expectation of a total return of at
least 10% over the next 12 months.
Neutral: A security, which at the time the rating is instituted and or reiterated, indicates an expectation of a total return
between negative 10% and 10% over the next 12 months.
Sell: A security, which at the time the rating is instituted and or reiterated, indicates an expectation that the price will decline
by more than 10% over the next 12 months.

Page 4 of 5
China Ritar Power Corp. China Company Note - November 16, 2010

Not Rated: A security which at the time the rating is instituted and or reiterated, indicates that we have no opinion or
expectations as to the price of the security over the next 12 months.
Not Covered (NC): ROTH does not publish research or have an opinion about the security.
ROTH Capital Partners, LLC expects to receive or intends to seek compensation for investment banking or other business
relationships with the covered companies mentioned in this report in the next three months.The material, information and
facts discussed in this report other than the information regarding ROTH Capital Partners, LLC and its affiliates, are from
sources believed to be reliable, but are in no way guaranteed to be complete or accurate. This report should not be used as
a complete analysis of the company, industry or security discussed in the report. Additional information is available upon
request. This is not, however, an offer or solicitation of the securities discussed. Any opinions or estimates in this report are
subject to change without notice. An investment in the stock may involve risks and uncertainties that could cause actual
results to differ materially from the forward-looking statements. Additionally, an investment in the stock may involve a high
degree of risk and may not be suitable for all investors. No part of this report may be reproduced in any form without the
express written permission of ROTH. Copyright 2010. Member: FINRA/SIPC.

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