GREEN STAR ALTERNATIVE ENERGY

(GSAE.PK)

BUSINESS STRATEGY

·        Green Star Alternative Energy is committed to increasing shareholder value by aggressively pursuing the production of alternative energy, which in turn places the company in a position to contribute to the long-term health of the global economy

·        Ensuring high ethical and best business practices in order to guarantee long-term, sustainable development and growth

·        Implementing comprehensive additional wind power (an energy that is pollution free) production technologies to further increase value

·        Capitalizing on unmet market needs in the development and production of environmentally sound alternative energy sources that have been experiencing unprecedented growth

Green Star recently announced they were neto purchase Notos d.o.o. Notos, a privately held company, is currently a joint venture partner with Green Star on several wind energy projects in the Republic of Serbia. Green Star will become the nation’s first developer of wind power. GSAE is focused on this green technology and sustainable energy programs like wind turbines, hydro electric power generation, and other renewable electricity models. Energy is perhaps the most urgent issue for green technology. This includes the development of alternative fuels, new means of generating energy and energy efficiency.

In the last century, coal, oil and natural gas were promoted as cheap sources of energy, but their hidden costs have been enormous. Wind power has no hidden costs, and it has become more cost-effective with each new round of technological advancements. The advantages of wind energy are numerous and clear, and GSAE stands to benefit.

FUTURE PLANS

The future for humankind is tied to finding sources of renewable or virtually inexhaustible energy. It is difficult to comprehend, but even if we find enough oil and gas for the intermediate-term, let’s say for the next few hundred years or so, what will humans do for the thousand years after they are depleted? The world is now engaged in a race for alternative energy sources, and it places our descendants as the subjects. To help counteract this trend, the company is investing its capital to evaluate potential wind farm locations and fund the construction of the 20 MW wind power facility in the Republic of Serbia. There are several factors that have helped shape Green Star’s focus on this area. The most important being the political will to institute significant change into a dated framework. Until 2004, power generation for sale had been permitted only by the nationalized body of the EPS. On  August 1, 2004 Serbian Energy Law was established - -  providing the important principles of open access to all energy systems and energy supply networks, the liberalization of the energy market, and priority for renewable energy sources. There are currently no wind power projects producing energy in Serbia. This fact provides the Company with a real and substantial advantage as Green Star will become the first wind energy producer in Serbia.

INVESTMENT CONSIDERATIONS

Industry analysts predict that between now and 2025, the countries seen as offering the most potential for wind growth are the U.S., the UK and China (all far out in front), with Germany, Spain and the Scandinavian countries (dominated by Denmark) also featuring strongly. Experts agree that the U.S. and China offer by far the greatest wind opportunities. Investors looking to put their cash into an area that’s seen tremendous growth need look no further than wind energy. Wind has jumped ahead of other green energy sources because innovations in turbine technologies have improved efficiency and made systems the most cost effective alternative. Turbines can generate electricity with wind speeds starting at 8 to 16 miles per hour (13 to 16 kilometers per hour) according to the U.S Department of Energy. Another reason wind surged to the forefront is because many states passed standards that require that a percentage of the state’s electricity be made from renewable energy sources. Green Star has very specific goals in their business plan, and the recent economic slump looks to be winding down. With the potential purchase of Notos, management expects the issuance of between five and ten million restricted shares, which they believe will strengthen their industry position and increase shareholder value.  We arrived at its price target $2.38 per share by taking 7 times 2011 projected net income of .34 per share (U.S $17.2 million) and we assume there could be 50 million shares outstanding.

Management states, “The Company is progressing with its corporate strategy by undertaking financings for the development of our wind farm projects. The initial capital will create a significant asset and revenue base which will further facilitate further growth and expansion – to a minimum of 300 MW of installed power capacity in 2013”.

ANALYST