China-Biotics Inc. is engaged in the research, development, production, marketing and distribution of probiotics products, which are products that contain live microbial food supplements, which beneficially affect the host by improving its intestinal microbial balance. The Company manufactures and sells its products under the Shining brand. The Company's four major products are Shining Essence, Shining Signal, Shining Golden Shield and Shining Energy. During the fiscal year ended March 31, 2007 (fiscal 2007), sales of Shining Essence represented approximately 61% of the Company's total sales. The Company's products are sold primarily in the Greater Shanghai region. The products are mainly sold to distributors, which then distribute them to various retail outlets, such as drug stores and supermarkets. The Company's wholly owned subsidiaries include Sinosmart Group Inc. (SGI) and Growing State Limited (GSL). As of July 2007, the Company has 14 direct retail outlets.

Shining is one of the most recognized brands in Shanghai. China-Biotics plans to expand its retail sales to other major cities in China. The Company's flagship product, `Shining Essence,` has been a profit driver. There is a significant demand for probiotics for use in the bulk additive market, which is currently met by imports. China-Biotics is building a new plant which will increase its production capacity manifolds to capture this market.