CMDS China Med

    CHINA MEDSTAR LIMITED

Enhanced Funding Arrangement

China Medstar Limited ("Medstar" or the "Company"), specialist in the supply of
diagnostic imaging and radiotherapy equipment to medical centres in hospitals
in China, announces it has received approval for a Finance Lease Licence (the
"Licence") from the government of the People's Republic of China.

The Company announced in its interim results last September that it had
submitted an application and today's successful outcome means the availability
of further potential business opportunities for Medstar. This will be driven by
an enlarged range of funding options to those hospitals who wish to either
purchase equipment or open cancer treatment centres in partnership with
Medstar.

To date, the Company has generated revenues through its Equipment Leasing
Division from operating leases through profit share agreements with hospitals.
The Licence allows the Company to expand its service offerings to include both
short and long term finance leases to hospitals or a fixed minimum payment plus
profit sharing arrangement. A principal benefit of this Licence is that the
Company may now enter into agreements with hospitals where the regional
government will only permit finance leases as a means of capital investment.

Dr. Cheng Zheng, Chairman and CEO, commented:

"Today's development will enable us to compete in the previously untouched
financing market and should provide a number of future opportunities. The
Directors are confident that this strengthened financing position will lead to
further contracts and a broadening of the overall business strategy.

"We plan to increase our market share over the next six months while
continually improving our operational position."

                                                                8 November 2007

Enquiries:

China Medstar Ltd                      Tel: +86 (10) 5825 6867               
                                                                             
Dr Cheng Zheng, Chairman and CEO/ 
Yap Yaw Kong, CFO                                                                
                                                                             
Evolution Securities                   Tel: +44 (0) 20 7071 4300             
                                                                             
Tom Price/Bobbie Hilliam                                                     
                                                                             
Evolution Securities China             Tel: +44 (0) 20 7220 4850             
                                                                             
Nick Martin                                                                  
                                                                             
Nexus Financial Ltd                    Tel: +44 (0) 20 7451 7050             
                                                                             
Nicholas Nelson/Kathy Boate                                                  



END

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