PRIME GLOBAL CAPITAL GROUP Inc - FORM 10-Q

Attached files

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EX-31.1 - CERTIFICATION - PRIME GLOBAL CAPITAL GROUP Inc	prime_10q-ex3101.htm
EX-32.2 - CERTIFICATION - PRIME GLOBAL CAPITAL GROUP Inc	prime_10q-ex3202.htm
EX-32.1 - CERTIFICATION - PRIME GLOBAL CAPITAL GROUP Inc	prime_10q-ex3201.htm
EX-31.2 - CERTIFICATION - PRIME GLOBAL CAPITAL GROUP Inc	prime_10q-ex3102.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED JANUARY 31, 2011

o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number 333-158713

PRIME GLOBAL CAPITAL GROUP INCORPORATED

(Exact Name of Registrant as Specified in Its Charter)

NEVADA		26-4309660
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

11-2, Jalan 26/70A, Desa Sri Hartamas

50480 Kuala Lumpur, Malaysia

603 6201 3198

(Address of Principal Executive Offices and Issuer’s

Telephone Number, including Area Code)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes o No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o		Accelerated filer o

Non-accelerated filer o		Smaller reporting company x
(Do not check if smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

As of March 16, 2011, the issuer had outstanding 500,000,003 shares of common stock.

TABLE OF CONTENTS

		Page


PART I	FINANCIAL INFORMATION

ITEM 1	Financial Statements	1

	Condensed Consolidated Balance Sheets as of January 31, 2011 and October 31, 2010	1

	Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the Three Months Ended January 31, 2011 and 2010	2

	Condensed Consolidated Statements of Cash Flows for the Three Months Ended January 31, 2011 and 2010	3

	Condensed Consolidated Statement of Stockholders’ Equity for the Three Months Ended January 31, 2011	4

	Notes to Condensed Consolidated Financial Statements	5

ITEM 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17

ITEM 3	Quantitative and Qualitative Disclosures about Market Risk	25

ITEM 4	Controls and Procedures	25

PART II	OTHER INFORMATION

ITEM 1	Legal Proceedings	26

ITEM 1A	Risk Factors	26

ITEM 2	Unregistered Sales of Equity Securities and Use of Proceeds	26

ITEM 3	Defaults upon Senior Securities	26

ITEM 4	(Removed and Reserved)	26

ITEM 5	Other Information	27

ITEM 6	Exhibits	27

SIGNATURES		28

PART I - FINANCIAL INFORMATION

ITEM 1. Financial Statements

PRIME GLOBAL CAPITAL GROUP INCORPORATED

(Formerly Home Touch Holding Company)

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF JANUARY 31, 2011 AND OCTOBER 31, 2010

(Currency expressed in United States Dollars (“US$”), except for number of shares)

	January 31, 2011		October 31, 2010
	(Unaudited)		(Audited)
ASSETS
Current assets:
Cash and cash equivalents	$	400,236	$	527,189
Accounts receivable, trade		756,700		105,516
Earnest deposit		811,545		-
Deposits and other receivables		42,317		40,619

Total current assets		2,010,798		673,324

Non-current assets:
Plant and equipment, net		117,306		124,031

TOTAL ASSETS	$	2,128,104	$	797,355

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	-	$	116,058
Deferred revenue		873		1,182
Amount due to a related party		3,272		-
Amount due to a director		782,030		185,724
Current portion of obligation under finance lease		6,013		6,268
Income tax payable		45,906		21,229
Accrued liabilities and other payables		33,596		39,504

Total current liabilities		871,690		369,965

Long-term liabilities:
Obligation under finance lease		48,575		49,636

Total liabilities		920,265		419,601

Commitments and contingencies

Stockholders’ equity:
Preferred stock, $0.001 par value, 100,000,000 shares authorized; no shares issued and outstanding		-		-
Common stock, $0.001 par value; 1,000,000,000 shares authorized; 100,000,003 and 20,000,003 shares issued and outstanding, respectively		100,000		20,000
Additional paid-in capital		1,040,260		320,260
Accumulated other comprehensive income		7,986		907
Retained earnings		59,593		36,587

Total stockholders’ equity		1,207,839		377,754

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	2,128,104	$	797,355

See accompanying notes to condensed consolidated financial statements.

PRIME GLOBAL CAPITAL GROUP INCORPORATED

(Formerly Home Touch Holding Company)

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE INCOME (LOSS)

FOR THE THREE MONTHS ENDED JANUARY 31, 2011 AND 2010

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

	Three months ended January 31,
	2011			2010
Revenue, net:
Software sales	$	322		$	-
Product sales		743,683			-
Total revenues, net		744,005			-

Cost of revenue		(586,249	)		-

Gross profit		157,756			-

Operating expenses:
General and administrative expenses		(110,327	)		(43	)

Income (loss) from operations		47,429			(43	)

Other expense:
Interest expense		(485	)		-

Income (loss) before income tax		46,944			(43	)

Income tax expense		(23,938	)		-

NET INCOME (LOSS)	$	23,006		$	(43	)

Other comprehensive income:
- Foreign exchange adjustment gain		7,079			1

COMPREHENSIVE INCOME (LOSS)	$	30,085		$	(42	)

Net income (loss) per share – Basic and diluted	$	0.00		$	(0.00	)

Weighted average common shares outstanding – Basic and diluted		87,122,224			16,500,000

See accompanying notes to condensed consolidated financial statements.

PRIME GLOBAL CAPITAL GROUP INCORPORATED

(Formerly Home Touch Holding Company)

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE THREE MONTHS ENDED JANUARY 31, 2011 AND 2010

(Currency expressed in United States Dollars (“US$”))

(Unaudited)

	Three months ended January 31,
	2011			2010

Cash flows from operating activities:
Net income (loss)	$	23,006		$	(43	)
Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities:
Depreciation		6,513			-
Changes in operating assets and liabilities:
Accounts receivable		(638,421	)		-
Deposits and other receivables		(1,365	)		-
Accounts payable		(115,778	)		-
Deferred revenue		(322	)		-
Amount due to a related party		3,216			-
Amount due to a director		410,741			-
Income tax payable		23,938			-
Accrued liabilities and other payables		(5,906	)		207

Net cash (used in) provided by operating activities		(294,378	)		164

Cash flows from investing activities:
Payment of earnest deposits		(797,584	)		-

Net cash used in investing activities		(797,584	)		-

Cash flows from financing activities:
Advances from (repayment to) a director		172,559			(620	)
Repayment of finance lease		(2,120	)		-
Proceeds from sale of common stocks		800,000			-

Net cash provided by (used in) financing activities		970,439			(620	)

Foreign currency translation adjustment		(5,430	)		1
NET CHANGE IN CASH AND CASH EQUIVALENTS		(126,953	)		(455	)

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD		527,189			501

CASH AND CASH EQUIVALENTS, END OF PERIOD	$	400,236		$	46

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for income tax	$	-		$	-
Cash paid for interest	$	485		$	-

See accompanying notes to condensed consolidated financial statements.

PRIME GLOBAL CAPITAL GROUP INCORPORATED

(Formerly Home Touch Holding Company)

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

FOR THE THREE MONTHS ENDED JANUARY 31, 2011

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

	Preferred Stock			Common Stock
	No. of share	Amount		No. of share	Amount		Additional paid-in capital		Accumulated other comprehensive income		Retained earnings		Total stockholders’ equity

Balance as of November 1, 2010 (restated)	-	$	-	16,500,000	$	16,500	$	320,260	$	907	$	36,587	$	374,254

Sale of common stocks to investors	-		-	80,000,000		80,000		720,000		-		-		800,000

Share effectively issued to former PGCG stockholders as part of the December 6, 2010 recapitalization	-		-	3,500,003		3,500		-		-		-		3,500

Net income for the period	-		-	-		-		-		-		23,006		23,006

Foreign currency translation adjustment	-		-	-		-		-		7,079		-		7,079

Balance as of January 31, 2011	-	$	-	100,000,003	$	100,000	$	1,040,260	$	7,986	$	59,593	$	1,207,839

See accompanying notes to condensed consolidated financial statements.

PRIME GLOBAL CAPITAL GROUP INCORPORATED

(Formerly Home Touch Holding Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED JANUARY 31, 2011 AND 2010

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

NOTE－1

BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements have been prepared by the Company in accordance with both accounting principles generally accepted in the United States of America (“GAAP”) and the instructions to Form 10-Q and Rule 8-03 of Regulation S-X. Certain information and note disclosures normally included in audited financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading.

In the opinion of management, the consolidated balance sheet as of October 31, 2010 has been derived from the audited consolidated financial statements and these unaudited condensed consolidated financial statements reflect all normal and recurring adjustments considered necessary to state fairly the results for the periods presented. The results of operation for the three months ended January 31, 2011 are not necessarily indicative of the results to be expected for the entire fiscal year ending October 31, 2011 or for any future period.

These unaudited condensed consolidated financial statements and notes thereto should be read in conjunction with the audited financial statements and notes thereto included in the Transition Report on Form 10-K for the period ended October 31, 2010.

NOTE－2

ORGANIZATION AND BUSINESS BACKGROUND

Prime Global Capital Group Incorporated (formerly Home Touch Holding Company) (“PGCG” or “the Company”) was incorporated in the State of Nevada on January 26, 2009. On January 25, 2011, the Company changed its current name to “Prime Global Capital Group Incorporated”.

The Company, through its subsidiary is principally engaged in the provision of IT consulting and programming services and distributing consumer products in Malaysia.

On July 15, 2010, the Company approved the 1 for 20 reverse split of its common stock. All common stock and per share data for all periods presented in these condensed consolidated financial statements have been restated to give effect to the reverse stock split.

On January 25, 2011, the Company changed its the fiscal year from March 31 to October 31 and increased its authorized capital to 1 billion shares of common stock and 100 million shares of preferred stock.

Recapitalization and reorganization

On September 21, 2010, the Company consummated the sale to certain accredited investors of an aggregate of 1,500,000 shares of its common stock, par value $0.001, at a per share price of $0.10, or $150,000 in the aggregate, pursuant to certain subscription agreements.

On November 15, 2010, the Company consummated the sale to 18 accredited investors of an aggregate of 80,000,000 shares of its common stock, par value $0.001, at a per share price of $0.01, or $800,000 in the aggregate, pursuant to certain subscription agreements.

Concurrently, on November 15, 2010, the Company appointed three new directors, Mr. Weng Kung Wong, Mr. Liong Tat Teh and Ms. Sek Fong Wong to the Company’s Board of Directors. Furthermore, all of the Company’s former officers resigned from their positions and Mr. Weng Kung Wong was appointed as the new chief executive officer, Mr. Teh Liong Tat as the new chief financial officer.

On December 6, 2010, the Company acquired Union Hub Technology Sdn. Bhd. (“UHT”), a company incorporated under the laws of Malaysia, through a share exchange transaction, or the Share Exchange. Pursuant to the Share Exchange, the Company acquired from the UHT shareholders all of the issued and outstanding shares of UHT in exchange for the issuance of 16,500,000 shares of its common stock. As a result of the Share Exchange, UHT became a wholly owned subsidiary of the Company.

Concurrently, on December 6, 2010, the Company entered into and executed agreement to sell its wholly-owned subsidiary, Home Touch Limited (a corporation organized under the laws of the Hong Kong Special Administrative Region), to the former founders and directors for $20,000. Upon the completion of this sale, Mr. Ng and Ms. Yau, the former founders and executive officers, were resigned from their positions on the board of directors.

PRIME GLOBAL CAPITAL GROUP INCORPORATED

(Formerly Home Touch Holding Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED JANUARY 31, 2011 AND 2010

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

The share exchange transaction has been accounted for as a reverse acquisition and recapitalization of the Company whereby UHT is deemed to be the accounting acquirer (legal acquiree) and the Company to be the accounting acquiree (legal acquirer). The accompanying condensed consolidated financial statements are in substance those of UHT, with the assets and liabilities, and revenues and expenses, of the Company being included effective from the date of the reverse acquisition. The Company is deemed to be a continuation of the business of UHT.

Accordingly, the accompanying condensed consolidated financial statements include the following:

(1) the balance sheet consists of the net assets of the accounting acquirer at historical cost and the net assets of the accounting acquiree at historical cost;

(2) the financial position, results of operations, and cash flows of the accounting acquirer for all periods presented as if the recapitalization had occurred at the beginning of the earliest period presented and the operations of the accounting acquiree from the date of share exchange transaction.

PGCG and its subsidiary are hereinafter referred to as (the “Company”).

NOTE－3

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

●	Use of estimates

In preparing these condensed consolidated financial statements, management makes estimates and assumptions that affect the reported amounts of assets and liabilities in the balance sheets and revenues and expenses during the periods reported. Actual results may differ from these estimates.

●	Basis of consolidation

The condensed consolidated financial statements include the financial statements of PGCG and its wholly-owned subsidiary. All significant inter-company balances and transactions within the Company have been eliminated upon consolidation.

●	Cash and cash equivalents

Cash and cash equivalents are carried at cost and represent cash on hand, demand deposits placed with banks or other financial institutions and all highly liquid investments with an original maturity of three months or less as of the purchase date of such investments.

PRIME GLOBAL CAPITAL GROUP INCORPORATED

(Formerly Home Touch Holding Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED JANUARY 31, 2011 AND 2010

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

●	Accounts receivable

Accounts receivable are recorded at the invoiced amount and do not bear interest. The Company extends unsecured credit to its customers in the ordinary course of business but mitigates the associated risks by performing credit checks and actively pursuing past due accounts. An allowance for doubtful accounts is established and determined based on managements’ assessment of known requirements, aging of receivables, payment history, the customer’s current credit worthiness and the economic environment. The Company did not record any allowance for doubtful accounts for both periods.

●	Plant and equipment

Plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated on the straight-line basis over the following expected useful lives from the date on which they become fully operational:

	Expected useful life
Motor vehicle	5 years

Expenditure for maintenance and repairs is expensed as incurred. The gain or loss on the disposal of plant and equipment is the difference between the net sales proceeds and the carrying amount of the relevant assets and is recognized in the statement of operations.

Depreciation expense for the three months ended January 31, 2011 and 2010 were $6,513 and $0, respectively.

●	Impairment of long-lived assets

Long-lived assets primarily include plant and equipment. In accordance with the provision of Accounting Standards Codification (“ASC”) Topic 360-10-5, “Impairment or Disposal of Long-Lived Assets”, the Company reviews its long-lived assets for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. If the total of the expected undiscounted future net cash flows is less than the carrying amount of the asset, a loss is recognized for the difference between the fair value and carrying amount of the asset. There has been no impairment charge for any periods presented.

●	Finance leases

Leases that transfer substantially all the rewards and risks of ownership to the lessee, other than legal title, are accounted for as finance leases. Substantially all of the risks or benefits of ownership are deemed to have been transferred if any one of the four criteria is met: (i) transfer of ownership to the lessee at the end of the lease term, (ii) the lease containing a bargain purchase option, (iii) the lease term exceeding 75% of the estimated economic life of the leased asset, (iv) the present value of the minimum lease payments exceeding 90% of the fair value. At the inception of a finance lease, the Company as the lessee records an asset and an obligation at an amount equal to the present value of the minimum lease payments. The leased asset is amortized over the shorter of the lease term or its estimated useful life if title does not transfer to the Company, while the leased asset is depreciated in accordance with the Company’s depreciation policy if the title is to eventually transfer to the Company. The periodic rent payments made during the lease term are allocated between a reduction in the obligation and interest element using the effective interest method in accordance with the provisions of ASC Topic 835-30, “Imputation of Interest”.

PRIME GLOBAL CAPITAL GROUP INCORPORATED

(Formerly Home Touch Holding Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED JANUARY 31, 2011 AND 2010

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

●	Revenue recognition

Revenues from the sale of software products are recognized and billed upon delivery of the product provided that persuasive evidence of an arrangement exists, collection is probable, payment terms are fixed or determinable and no significant obligations remain, in accordance with ASC Topic 605, “Revenue Recognition”.

(a) Software sales

The Company generally sells the software products under multiple element arrangements at the fixed fee, based upon the customers’ specifications or modifications, bundled with maintenance and support service for a certain period of time. Maintenance and support service consists of technical support and software upgrades and enhancements. The Company allocates the total arrangement fee among each element based on vendor-specific objective evidence of the relative fair value of each of the elements. The Company limits its assessment of fair value of each element to the price charged when the same element is sold separately. If the fair value of each element in a multiple element arrangement cannot be reliably determined, and if the fair value of any undelivered element cannot also be reliably determined, all revenue under the arrangement is deferred until such time as the only remaining undelivered element is maintenance and support, at which time revenue is recognized over the remaining maintenance and support service period. Under the residual method, the fair value of the undelivered elements is deferred and the remaining portion of the arrangement fee is recognized as revenue, assuming collection is probable. For the billed software product sales, the revenue from the undelivered element is included in deferred revenue and amortized ratably to revenue over its contractual term, typically one year.

The Company generally offers product warranty and post-contract customer support (“PCS”) to its customers for a period of twelve months, free of charge. The Company periodically assesses the adequacy of its recorded warranty liabilities and adjusts the amounts as necessary.

(b) Product sales

The Company also earns the revenue from trading of luxury consumer products. Revenue is recognized when title passes to the customer, which is generally when the product is delivered, assuming no significant Company obligations remain and the collection of relevant receivables is probable.

●	Income taxes

Income taxes are determined in accordance with the provisions of ASC Topic 740, “Income Taxes” (“ASC 740”). Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Any effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts.

For the three months ended January 31, 2011 and 2010, the Company did not have any interest and penalties associated with tax positions. As of January 31, 2011, the Company did not have any significant unrecognized uncertain tax positions.

PRIME GLOBAL CAPITAL GROUP INCORPORATED

(Formerly Home Touch Holding Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED JANUARY 31, 2011 AND 2010

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

The Company conducts major businesses in Malaysia and is subject to tax in its own jurisdiction. As a result of its business activities, the Company will file separate tax returns that are subject to examination by the foreign tax authority.

●	Net income per share

The Company calculates net income per share in accordance with ASC Topic 260, “Earnings per Share.” Basic net income per share is computed by dividing the net income by the weighted-average number of common shares outstanding during the period. Diluted income per share is computed similar to basic income per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common stock equivalents had been issued and if the additional common shares were dilutive.

●	Comprehensive income

ASC Topic 220, “Comprehensive Income” establishes standards for reporting and display of comprehensive income, its components and accumulated balances. Comprehensive income as defined includes all changes in equity during a period from non-owner sources. Accumulated comprehensive income, as presented in the accompanying statements of stockholders’ equity consists of changes in unrealized gains and losses on foreign currency translation. This comprehensive income is not included in the computation of income tax expense or benefit.

●	Foreign currencies translation

Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the consolidated statement of operations.

The reporting currency of the Company is the United States Dollars ("US$") and the accompanying condensed consolidated financial statements have been expressed in US$. In addition, the Company maintains its books and records in its local currency, Malaysian Ringgit ("MYR"), which is functional currency as being the primary currency of the economic environment in which the entity operates.

In general, for consolidation purposes, assets and liabilities of its subsidiary whose functional currency is not US$ are translated into US$, in accordance with ASC Topic 830-30, “Translation of Financial Statement”, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiary are recorded as a separate component of accumulated other comprehensive income within the statement of stockholders’ equity. The gains and losses are recorded as a separate component of accumulated other comprehensive income within the statement of stockholders’ equity.

Translation of amounts from the local currency of the Company into US$1 has been made at the following exchange rates for the respective periods:

	January 31, 2011		January 31, 2010
Period-end MYR : US$1 exchange rate		3.0559		3.4219
Period average MYR : US$1 exchange rate		3.1094		3.4054

PRIME GLOBAL CAPITAL GROUP INCORPORATED

(Formerly Home Touch Holding Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED JANUARY 31, 2011 AND 2010

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

●	Related parties

Parties, which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operating decisions. Companies are also considered to be related if they are subject to common control or common significant influence.

●	Segment reporting

ASC Topic 280, “Segment Reporting” establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organization structure as well as information about geographical areas, business segments and major customers in financial statements. The Company operates in two reportable operating segments in Malaysia.

●	Fair value of financial instruments

The carrying value of the Company’s financial instruments (excluding obligation under finance lease): cash and cash equivalents, accounts receivable, earnest money deposit, deposits and other receivables, deferred revenue, income tax payable, amount due to a related party and a director, accrued liabilities and other payables approximate at their fair values because of the short-term nature of these financial instruments.

Management believes, based on the current market prices or interest rates for similar debt instruments, the fair value of its obligation under finance lease approximate the carrying amount.

The Company also follows the guidance of the ASC Topic 820-10, “Fair Value Measurements and Disclosures” ("ASC 820-10"), with respect to financial assets and liabilities that are measured at fair value. ASC 820-10 establishes a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows:

·		Level 1 : Observable inputs such as quoted prices in active markets;
·	Level 2 : Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and
·	Level 3 : Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions

Fair value estimates are made at a specific point in time based on relevant market information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

●	Recent accounting pronouncements

The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and do not believe the adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations, as follows:

In October 2009, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2009-14 to amend ASC 605 “Revenue Recognition.” The amendments in this update change the accounting model for revenue arrangements that include both tangible products and software elements. The amendments in ASU 2009-14 will be effective for the fiscal years beginning January 1, 2011. The adoption of the guidance did not have a material impact on the Company’s condensed consolidated financial statements.

PRIME GLOBAL CAPITAL GROUP INCORPORATED

(Formerly Home Touch Holding Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED JANUARY 31, 2011 AND 2010

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

In October 2009, the FASB issued ASU 2009-13 amending ASC 605 related to revenue arrangements with multiple deliverables. Among other things, ASU 2009-13 provides guidance for entities in determining the accounting for multiple deliverable arrangements and establishes a hierarchy for determining the amount of revenue to allocate to the various deliverables. The amendments in ASU 2009-13 will be effective for the fiscal years beginning January 1, 2011. The adoption of the guidance did not have a material impact on the Company’s condensed consolidated financial statements

In January 2010, the FASB issued further guidance under ASC No. 820, “Fair Value Measurements and Disclosures” ("ASC 820"). ASC 820 requires disclosures about the transfers of investments between levels in the fair value hierarchy and disclosures relating to the reconciliation of fair value measurements using significant unobservable inputs (level 3 investments). ASC 820 is effective for the fiscal years and interim periods beginning after December 15, 2010. The adoption of the guidance did not have a material impact on the Company’s condensed consolidated financial statements.

NOTE－4

EARNEST MONEY DEPOSIT

During the three months ended January 31, 2011, the Company made an earnest money deposit of $811,545 in connection with a potential acquisition and management of a palm oil plantation. The deposit was unsecured and interest free and made with a prospective and independent vendor in Malaysia. Earnest money deposit is recorded when payment is made by the Company. The earnest money deposit was refunded to the Company in March 2011 upon the termination of discussions with such vendor.

NOTE－5

AMOUNT DUE TO A DIRECTOR

As of January 31, 2011 and December 31, 2010, amount due to a director represented temporary advances made to the Company by the director and chief executive officer of the Company, Mr. Weng Kung Wong, which was unsecured, interest-free and repayable on demand.

NOTE－6

OBLIGATION UNDER FINANCE LEASE

The Company purchased motor vehicle under a finance lease agreement with the effective interest rate of 6.58% per annum, due through July 21, 2017, with principal and interest payable monthly. The obligation under the finance lease is as follows:

	January 31, 2011

Finance lease	$	56,364
Less: interest expense		(1,776	)

Net present value of finance lease	$	54,588

Representing as:
Current portion	$	6,013
Non-current portion		48,575

Total	$	54,588

PRIME GLOBAL CAPITAL GROUP INCORPORATED

(Formerly Home Touch Holding Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED JANUARY 31, 2011 AND 2010

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

As of January 31, 2011, the maturities of the finance lease for each of the five years and thereafter are as follows:

Years ending January 31:
2012	$	6,013
2013		7,581
2014		8,139
2015		8,696
2016		9,253
Thereafter		14,906

Total	$	54,588

NOTE－7

INCOME TAXES

For the three months ended January 31, 2011 and 2010, the local (United States) and foreign components of income (loss) before income taxes were comprised of the following:

	Three months ended January 31,
	2011			2010
Tax jurisdictions from:
– Local	$	(72,750	)	$	-
– Foreign		119,694			(43	)
Income (loss) before income taxes	$	46,944		$	(43	)

Provision for income taxes consisted of the following:

	Three months ended January 31,
	2011		2010
Current:
– Local	$	-	$	-
– Foreign		23,938		-

Deferred:
– Local		-		-
– Foreign		-		-

Income tax expense	$	23,938	$	-

The effective tax rate in the periods presented is the result of the mix of income earned in various tax jurisdictions that apply a broad range of income tax rates. During the three months ended January 31, 2011 and 2010, the Company has a subsidiary that operates in Malaysia and is subject to tax in the jurisdictions in which it operates, as follows:

PRIME GLOBAL CAPITAL GROUP INCORPORATED

(Formerly Home Touch Holding Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED JANUARY 31, 2011 AND 2010

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

United States of America

PCGC is registered in the State of Nevada and is subject to United States of America tax law. As of January 31, 2011, the operations in the United States of America incurred $100,938 of cumulative net operating losses which can be carried forward to offset future taxable income. The net operating loss carryforwards begin to expire in 2030, if unutilized. The Company has provided for a full valuation allowance of $34,319 against the deferred tax assets on the expected future tax benefits from the net operating loss carryforwards as the management believes it is more likely than not that these assets will not be realized in the future.

Malaysia

UHT is subject to the Malaysia Corporate Tax Laws at the statutory rate of 20% on the assessable income for the periods presented.

For the three months ended January 31, 2011 and 2010, UHT generated an operating income of $154,362 and an operating loss of $221, respectively. A reconciliation of income (loss) before income taxes to the effective tax rate as follows:

	Three months ended January31,
	2011			2010

Income (loss) before income taxes	$	119,694		$	(43	)
Statutory income tax rate		20	%		20	%
Income tax expense at statutory rate		23,938			(8	)
Net operating loss		-			8
Income tax expense at effective rate	$	23,938		$	-

No provision for deferred tax assets or liabilities has been made, since the Company had no material temporary differences between the tax bases of assets and liabilities and their carrying amounts.

NOTE－8

STOCKHOLDERS’ EQUITY

On December 6, 2010, the Company issued 16,500,000 shares of its common stock to the UHT shareholders in connection with the acquisition of UHT through the Share Exchange. The acquisition is a capital transaction in substance and therefore was accounted for as a recapitalization. The 16,500,000 shares issued was restated and adjusted to account for the effects of the Share Exchange.

On January 25, 2011, the Company increased its authorized capital to 1 billion shares of common stock and 100 million shares of preferred stock.

As of January 31, 2011, the number of shares of the Company’s common stock issued and outstanding was 100,000,003 shares. There are no shares of preferred stock issued and outstanding.

PRIME GLOBAL CAPITAL GROUP INCORPORATED

(Formerly Home Touch Holding Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED JANUARY 31, 2011 AND 2010

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

NOTE－9

RELATED PARTY TRANSACTIONS

For the three months ended January 31, 2011, the Company leased an office premise at the current market value of $1,608 from a related company, which is controlled by the director and chief executive officer of the Company, Mr. Weng Kung Wong in the normal course of business.

NOTE－10

SEGMENT INFORMATION

The Company operates two reportable business segments in Malaysia, as defined by ASC Topic 280:

●	Software business – sale of software products

●	Trading business – trading of luxury consumer products

The accounting policies of the segments are the same as those described in the summary of significant accounting policies (see Note 3). The Company had no inter-segment sales for the three months ended January 31, 2011 and 2010. Summarized financial information concerning the Company’s reportable segments is shown in the following table for the three months ended January 31, 2011 and 2010:

	Three months ended January 31,
	2011		2010
Revenue from external customers:
- Software sales	$	322	$	-
- Product sales		743,683		-
Total revenues, net		744,005		-

Cost of revenues:
- Software sales		-		-
- Product sales		586,249		-
Total cost of revenues		586,249		-

Gross profit		157,756		-
Depreciation		6,513		-
Net income (loss)		23,006		(43	)
Total assets		2,128,104		618
Expenditure for long-lived assets	$	-	$	-

NOTE－11

CONCENTRATIONS OF RISK

The Company is exposed to the following concentrations of risk:

(a) Major customers

For the three months ended January 31, 2011, one customer represented more than 10% of the Company’s revenues amounting to $743,683 with $756,700 of accounts receivable at that date.

PRIME GLOBAL CAPITAL GROUP INCORPORATED

(Formerly Home Touch Holding Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED JANUARY 31, 2011 AND 2010

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

For the three months ended January 31, 2010, there was no single customer who accounted for 10% or more of the Company’s revenue.

(b) Major vendors

For the three months ended January 31, 2011, the vendor who accounted for 10% or more of the Company’s purchases and its outstanding balance at period-end date, is presented as follows:

	Three months ended January 31, 2011			January 31, 2011
	Purchases		Percentage of purchases	Accounts payable

Vendor A	$	438,307	75%	$	-
Vendor B		147,942	25%		-
Total:	$	586,249	100%	$	-

For the three months ended January 31, 2010, there was no single vendor who accounted for 10% or more of the Company’s purchases.

Financial instruments that are potentially subject to credit risk consist principally of trade receivables. The Company believes the concentration of credit risk in its trade receivables is substantially mitigated by its ongoing credit evaluation process and relatively short collection terms. The Company does not generally require collateral from customers. The Company evaluates the need for an allowance for doubtful accounts based upon factors surrounding the credit risk of specific customers, historical trends and other information.

(d) Exchange rate risk

The reporting currency of the Company is US$, to date the majority of the revenues and costs are denominated in MYR and a significant portion of the assets and liabilities are denominated in MYR. As a result, the Company is exposed to foreign exchange risk as its revenues and results of operations may be affected by fluctuations in the exchange rate between US$ and MYR. If MYR depreciates against US$, the value of MYR revenues and assets as expressed in US$ financial statements will decline. The Company does not hold any derivative or other financial instruments that expose to substantial market risk.

(e) Economic and political risks

Substantially all of the Company’s services are conducted in Malaysia and Asian region. The Company’s operations are subject to various political, economic, and other risks and uncertainties inherent in Malaysia. Among other risks, the Company’s operations are subject to the risks of restrictions on transfer of funds; export duties, quotas, and embargoes; domestic and international customs and tariffs; changing taxation policies; foreign exchange restrictions; and political conditions and governmental regulations in Malaysia.

PRIME GLOBAL CAPITAL GROUP INCORPORATED

(Formerly Home Touch Holding Company)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE MONTHS ENDED JANUARY 31, 2011 AND 2010

(Currency expressed in United States Dollars (“US$”), except for number of shares)

(Unaudited)

NOTE－12

COMMITMENTS AND CONTINGENCIES

The Company is committed to lease an office premise under a non-cancelable operating lease agreement with a related party, at a fixed monthly rental of $804 (approximately MYR 2,500) for a term of 2 years, due November 30, 2012.

As of January 31, 2011, the Company has future minimum rental payments due under a non-cancelable operating lease in the next two years, as follows:

Years ending January 31:
2012	$	9,817
2013		8,181

Total:	$	17,998

NOTE－13

SUBSEQUENT EVENT

On February 8, 2011, the Company consummated the sale to 19 of its existing accredited stockholders of an aggregate of 400,000,000 shares of its common stock, par value $0.001, at a per share price of $0.01, or $4,000,000 in the aggregate, pursuant to certain subscription agreements. Mr. Weng Kung Wong, the Chief Executive Officer and director of the Company participated in the transaction and purchased 32,300,000 shares of the Company’s common stock on the same terms and conditions as the other stockholders. The Subscription Agreements contain terms and conditions that are normal and customary for a transaction of this type. The Company received net proceeds of approximately $3,989,000 from this subscription, which will be used for general corporate purposes.

In accordance with ASC Topic 855, “Subsequent Events”, which establishes general standards of accounting for and disclosure of events that occur after the balance sheet date but before financial statements are issued, the Company has evaluated all events or transactions that occurred after January 31, 2011 up through the date was the Company issued the condensed consolidated financial statements. During the period, the Company did not have any material recognizable subsequent events.

ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward-looking statements

The following discussion of our financial condition and results of operations should be read in conjunction with the financial statements and the related notes thereto included elsewhere in this quarterly report on Form 10-Q. This quarterly report on Form 10-Q contains certain forward-looking statements and our future operating results could differ materially from those discussed herein. Certain statements contained in this discussion, including, without limitation, statements containing the words "believes," "anticipates," "expects" and the like, constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). However, as we issue “penny stock,” as such term is defined in Rule 3a51-1 promulgated under the Exchange Act, we are ineligible to rely on these safe harbor provisions. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. We disclaim any obligation to update any such factors or to announce publicly the results of any revisions of the forward-looking statements contained herein to reflect future events or developments.

Overview

History

We were incorporated in the state of Nevada on January 26, 2009, to serve as a holding company for our former smart home business, which was conducted through our former subsidiary, Home Touch Limited, a Hong Kong Special Administrative Region of China corporation, or HTL. On January 26, 2009, we acquired HTL through a share exchange transaction in which we exchanged 40,000,000 shares of our Common Stock for 10,000 shares of HTL common stock. HTL was originally organized under the name Lexing Group Limited in July 2004 and was renamed Home Touch Limited in 2005.

On July 15, 2010, we effectuated a 1-for-20 reverse stock split, or the Reverse Split, of all issued and outstanding shares of the Company's Common Stock in connection with our plans to attract additional financing and potential business opportunities. As a result of the Reverse Split, our issued and outstanding shares decreased from 40,000,000 to 2,000,003.

On September 27, 2010, we filed a report on Form 8-K disclosing the sale to certain accredited investors on September 21, 2010, of an aggregate of 1,500,000 shares of our Common Stock at a per share price of $0.10, or $150,000 in the aggregate, in accordance with the terms and conditions of certain subscription agreements made with such investors. The Company received net proceeds of approximately $145,000 from the sale of the shares and intends to use the net proceeds for general corporate purposes. The shares were sold pursuant to the exemption provided by Section 4(2) of the Securities Act of 1933, as amended, and Regulation D promulgated thereunder. Weng Kung Wong, who was appointed our Chief Executive Officer and director on November 15, 2010, purchased 375,000 shares of our Common Stock in this transaction.

Change in Control and Sale of HTL and Our Smart Home Business

On November 15, 2010, we consummated the sale to certain accredited investors of an aggregate of 80,000,000 shares of our Common Stock at a per share price of $0.01, or $800,000 in the aggregate, in accordance with the terms and conditions of certain subscription agreements made with such investors. The Company received net proceeds of approximately $795,000 from the sale of the shares and intends to use the net proceeds for general corporate purposes. The shares were sold pursuant to the exemption provided by Section 4(2) of the Securities Act of 1933, as amended and Regulation D promulgated thereunder. Weng Kung Wong, our Chief Executive Officer and director, purchased an additional 12,750,000 shares of our Common Stock in this transaction.

A change of control occurred in connection with the sale of such shares. David Ng and Stella Wai Yau resigned from their positions as President and Chief Executive Officer of the Company, and as Chief Financial Officer, Chief Operating Officer and Secretary of the Company effective November 15, 2010. The following individuals were appointed to serve as executive officers of the Company:

	Name	Office
	Weng Kung Wong	Chief Executive Officer
	Liong Tat Teh	Chief Financial Officer
	Sek Fong Wong	Secretary

Weng Kung Wong, Liong Tat Teh and Sek Fong Wong were further appointed to serve on our board of directors.

On December 6, 2010, we consummated a share exchange, or the Share Exchange, pursuant to which Wooi Khang Pua and Kok Wai Chai, or the UHT Shareholders, transferred to us all of the issued and outstanding shares of Union Hub Technology Sdn. Bhd., a company organized under the laws of Malaysia, or UHT, in exchange for the issuance of 16,500,000 shares of our common stock, par value $0.001 per share, or the Common Stock. The Share Exchange was made pursuant to the terms of a Share Exchange Agreement, or the Exchange Agreement, by and among, and the Company, the UHT Shareholders and UHT. As result of the Share Exchange, UHT became our wholly owned subsidiary. We relied on the exemption from registration pursuant to Section 4(2) of, and Regulation D and/or Regulation S promulgated under, the Securities Act of 1933, as amended, or the Securities Act, in issuing the UHT Shares.

Concurrently with the Share Exchange, we sold to Up Pride Investments Limited, a British Virgin Islands limited liability company owned by David Gunawan Ng, and Magicsuccess Investments Limited, a British Virgin Islands limited liability company owned by Stella Wai Yau, all of the issued and outstanding securities of Home Touch Limited, a Hong Kong Special Administrative Region of China corporation, or HTL, for cash consideration of $20,000. In connection with the sale, Mr. Ng and Ms. Yau, our former founders and executive officers, resigned from their positions on our board of directors. Our smart home business was conducted through HTL, and as result of the sale, we ceased our smart home business operations. The sale of HTL securities was made pursuant to the terms of a Common Stock Purchased Agreement, or the Common Stock Purchase Agreement, by and among the Company, HTL, Up Pride Investments Limited and Magicsuccess Investments Limited. We relied on the exemption from registration pursuant to Section 4(2) of, and Regulation D and/or Regulation S promulgated under, the Securities Act of 1933, as amended, or the Securities Act, in selling the HTL securities.

On January 25, 2011, we changed our name to Prime Global Capital Group Incorporated and increased our authorized capital to 1,000,000,000 shares of common stock and 100,000,000 shares of preferred stock from 100,000,000 shares of common stock and 10,000,000 shares of preferred stock. Effective January 25, 2011, we changed our fiscal year end from March 31 to October 31.

On February 8, 2011, we sold an aggregate of 400,000,000 shares of our common stock, par value $0.001 (the “Shares”), at a per share price of $0.01, or $4,000,000 in the aggregate, to 19 of our existing accredited stockholders in accordance with the terms and conditions of certain subscription agreements made with such investors (the “Subscription Agreements”). Weng Kung Wong, our Chief Executive Officer and director, participated in the transaction and purchased 32,300,000 shares of our common stock on the same terms and conditions as the other stockholders. The Subscription Agreements contain terms and conditions that are normal and customary for a transaction of this type. The Company received net proceeds of approximately $3,989,000 from the sale of the Shares, which will be used for general corporate purposes. The Shares were sold pursuant to the exemption provided by Section 4(2) of the Securities Act of 1933, as amended and Regulation D promulgated thereunder.

Current Business Segments

We operate in two business segments: (i) the design, development and operation of one or more technologies which enable a community of users to engage in social networking, research and e-commerce on a mobile platform, or the m-commerce business; and (ii) the distribution of consumer goods such as high-end timepieces to distributors, independent retailers and individual end-users. In July 2010, we launched our business operations and began developing, servicing and distributing software products to third parties as a means of generating revenue. Our consumer goods distribution business was launched in October 2010. We conduct both our software development and distribution and product distribution businesses through UHT.

We are also actively seeking business opportunities in the palm oil industry with a focus on the acquisition, lease or management of existing palm oil plantations located in Malaysia. We have engaged in preliminary discussions with various industry players from time to time and intend to continue these discussions in the foreseeable future.

Results of Operations

Comparison of the three months ended January 31, 2011 to the three months ended January 31, 2010

The following table shows our revenues by type for the three months ended January 31, 2011 compared to the three months ended January 31, 2010.

	For the Three Months Ended January 31,				$		%
	2011		2010		Change		Change

Net Revenues	$	744,005	$	-	$	744,005	NM
Software sales		322		-		322	0%
Product sales		743,683		-		743,683	NM
Cost of revenue		586,249		-		586,249	NM
Gross profit		157,756		-		157,756	NM
General and administrative expenses		110,327		43		110,284	NM
Other expense		485		-		485	NM
Income tax expense		23,938		-		23,938	NM
Net income (loss)		23,006		(43)		23,049	NM

*NM means not meaningful

Revenue. In July 2010, we commenced our business operations with the sale of software products and, in October 2010, with the distribution of luxury consumer products such as high-end timepieces. As a result, we generated net revenue of $744,005 for the three months ended January 31, 2011 with software sales accounting for $322, or 0.04% of net revenues, and product sales accounting for $743,683, or 99.96% of net revenues. We did not generate any revenues for the three months ended January 31, 2010. Prior to the launch of our business operations in July 2010, we were a development stage company with minimal revenues.

Cost of Revenue. Our cost of revenue as a percentage of net revenue was approximately 78.8% for the three months ended January 31, 2011, as compared to 0% for the same period in 2010. The increase is primarily attributable to the operation of our new product distribution business. Cost of revenue consisted primarily of software purchase costs, product costs and costs of labor that are directly attributable to the sale of software and luxury consumer products.

Gross Profit. We achieved a gross profit of $157,756 for the three months ended January 31, 2011, as compared to $0 for the same period in 2010. The increase is attributable to the operation of our new product distribution business during the three months ended January 31, 2011.

General and Administrative Expenses (“G&A”). We incurred G&A expenses of $110,327 for the three months ended January 31, 2011, representing an increase of $110,284, as compared to $43 for the three months ended January 31, 2010. The increase in G&A is primarily attributable to the operation of our product distribution business during the three months ended January 31, 2011. G&A as a percentage of net revenue was 14.8% for the three months ended January 31, 2011.

Other Expense. We incurred other expenses of $485 for the three months ended January 31, 2011, as compared to $0 for the three months ended January 31, 2010. The increase in expenses is attributable primarily to interest incurred in connection with financing the purchase of a motor vehicle on or about the commencement of our business operations.

Income Tax Expense. We recorded income tax expenses of $23,938 for the three months ended January 31, 2011, as compared to $0 for the three months ended January 31, 2010. The increase is primarily attributable to the revenue generated from the operation of our new product distribution business in the three months ended January 31, 2011. Tax expense as a percentage of income before income tax was approximately 51% for the three months ended January 31, 2011.

Liquidity and Capital Resources

Sources of Liquidity. We generated net income of $23,006 for the three months ended January 31, 2011. To date, we have financed our operations through private placements of our common stock which are summarized below:

Private Placement Transactions	Gross Proceeds
Sale of 999,998 UHT shares of common stock on 9/30/2010	$323,760
Sale of 1,500,000 shares of the Company’s common stock on 9/27/2010	$150,000
Sale of 80,000,000 shares of the Company’s common stock on 11/15/2010	$800,000
Sale of 400,000,000 shares of the Company’s common stock on 2/8/2011	$4,000,000
Total:	$5,273,760

Net Cash Provided By Operating Activities. For the three months ended January 31, 2011, net cash used in operating activities was $294,378, which consisted primarily of net income of $23,006, depreciation of $6,513, an increase in amount due to a director of $410,741, an increase in income tax payables of $23,938, an increase in amount due to a related party of $3,216, offset by an increase in accounts receivables of $638,421, a decrease in accounts payable of $115,778, and a decrease in accrued liabilities and other payables of $5,906. For the three months ended January 31, 2010, net cash provided by operating activities was $164, which consisted of net loss of $43 and an increase in accrued liabilities and other payables of $207.

Net Cash Used in Investing Activities. For the three months ended January 31, 2011, net cash used in investing activities was $797,584, all of which was attributable to the payment of an earnest money deposit made in connection with a potential acquisition and management of a palm oil plantation. The deposit was made with a prospective and independent vendor in Malaysia and was refunded to us upon the termination of our discussions with such vendor in March 2011. We did not engage in investing activities for the three months ended January 31, 2010.

Net Cash Provided By Financing Activities. For the three months ended January 31, 2011, net cash provided by financing activities was $970,439, consisting primarily of $800,000 from the sale of our common stock, $172,559 of advances from Mr. Wong, our Chief Executive Officer and director, and offset by repayments of $2,120 on a finance lease. During the comparable period ended January 31, 2010, net cash used in financing activities was $620, consisting solely of repayments to Mr. Wong of previously made advances.

Funding Requirements. We expect to incur greater expenses, including expenses related to the hiring of sales personnel and the establishment of international offices in the near future. We expect that our general and administrative expenses will also increase as we expand our finance and administrative staff, add infrastructure, and incur additional costs related to being a public company, including directors’ and officers’ insurance, investor relations programs, and increased professional fees. Our future capital requirements will depend on a number of factors, including the timing of future business acquisitions, if any, the costs involved in preparing, filing, prosecuting, maintaining, defending, and enforcing our intellectual property rights, the acquisition of strategic partnerships, the status of competitive products, the availability of financing, and our success in developing markets for our products and services.

We believe that the net proceeds from our recent private placement transactions, together with our existing cash, will be sufficient to enable us to fund our operating expenses and capital expenditure requirements through the end of the first calendar quarter of 2012. We have based this estimate on assumptions that may prove to be wrong, and we could use our available capital resources sooner than we currently expect, especially if we acquire one or more businesses or choose to expand our product development efforts more rapidly than we presently anticipate. In addition, we may decide to raise additional funds even before we need them if the conditions for raising capital are favorable. In such event, we may finance our future cash needs through public or private equity offerings, debt financings or corporate collaboration and licensing arrangements. We may also seek to sell additional equity or debt securities or obtain one or more credit facilities. We do not currently have any commitments for future external funding.

Off-Balance Sheet Arrangements

We have no outstanding off-balance sheet guarantees, interest rate swap transactions or foreign currency contracts. We do not engage in trading activities involving non-exchange traded contracts.

Critical Accounting Policies and Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires our management to make assumptions, estimates and judgments that affect the amounts reported, including the notes thereto, and related disclosures of commitments and contingencies, if any. We have identified certain accounting policies that are significant to the preparation of our financial statements. These accounting policies are important for an understanding of our financial condition and results of operations. Critical accounting policies are those that are most important to the presentation of our financial condition and results of operations and require management's subjective or complex judgment, often as a result of the need to make estimates about the effect of matters that are inherently uncertain and may change in subsequent periods. Certain accounting estimates are particularly sensitive because of their significance to financial statements and because of the possibility that future events affecting the estimate may differ significantly from management's current judgments. We believe the following accounting policies are critical in the preparation of our financial statements.

Use of estimates

In preparing these financial statements, management makes estimates and assumptions that affect the reported amounts of assets and liabilities in the balance sheets and revenues and expenses during the periods reported. Actual results may differ from these estimates.

Basis of consolidation

The consolidated financial statements include the financial statements of PGCG and its wholly owned subsidiary. All significant inter-company balances and transactions within the Company have been eliminated.

Cash and cash equivalents

Accounts receivable

Plant and equipment

	Expected useful life
Motor vehicle	5 years

Impairment of long-life assets

Long-lived assets primarily include plant and equipment. In accordance with ASC Topic 360-10-5, “Impairment or Disposal of Long-Lived Assets,” the Company periodically reviews its long-lived assets for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable. If the total of the expected undiscounted future net cash flows is less than the carrying amount of the asset, a loss is recognized for the difference between the fair value and carrying amount of the asset.

Finance leases

Leases that transfer substantially all the rewards and risks of ownership to the lessee, other than legal title, are accounted for as finance leases. Substantially all of the risks or benefits of ownership are deemed to have been transferred if any one of the four criteria is met: (i) transfer of ownership to the lessee at the end of the lease term, (ii) the lease containing a bargain purchase option, (iii) the lease term exceeding 75% of the estimated economic life of the leased asset, (iv) the present value of the minimum lease payments exceeding 90% of the fair value. At the inception of a finance lease, the Company as the lessee records an asset and an obligation at an amount equal to the present value of the minimum lease payments. The leased asset is amortized over the shorter of the lease term or its estimated useful life if title does not transfer to the Company, while the leased asset is depreciated in accordance with the Company’s normal depreciation policy if the title is to eventually transfer to the Company. The periodic rent payments made during the lease term are allocated between a reduction in the obligation and interest element using the effective interest method in accordance with the provisions of ASC Topic 835-30, “Imputation of Interest”.

Revenue recognition

(a) Software sales

(b) Product sales

The Company also earns the revenue from trading of luxury goods. Revenue is recognized when title passes to the customer, which is generally when the product is delivered, assuming no significant Company obligations remain and the collection of relevant receivables is probable.

Comprehensive income

Income taxes

For the three-month period ended January 31, 2011 and 2010, the Company did not have any interest and penalties associated with tax positions. As of January 31, 2011 and 2010, the Company did not have any significant unrecognized uncertain tax positions.

Foreign currencies translation

The reporting currency of the Company is the United States Dollars ("US$") and the accompanying financial statements have been expressed in US$. In addition, the Company maintains its books and record in a local currency, Malaysian Ringgit ("MYR"), which is functional currency as being the primary currency of the economic environment in which the entity operates.

In general, for consolidation purposes, assets and liabilities of its subsidiaries whose functional currency is not US$ are translated into US$, in accordance with ASC Topic 830-30, “Translation of Financial Statement”, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiary are recorded as a separate component of accumulated other comprehensive income within the statement of stockholders’ equity. The gains and losses are recorded as a separate component of accumulated other comprehensive income within the statement of stockholders’ equity.

Translation of amounts from the local currency of the Company into US$1 has been made at the following exchange rates for the respective periods:

	Three Months Ended January 31, 2011		Three Months Ended January 31, 2010
Period-end MYR1 : US$1 exchange rate		3.0559		3.4219
Period average MYR1 : US$1 exchange rate		3.1094		3.4054

Related parties

Segment reporting

Recent Accounting Pronouncements

The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and do not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations, as follows:

ITEM 3. Quantitative and Qualitative Disclosures about Market Risk

Not applicable.

ITEM 4. Controls and Procedures

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures

We conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended (Exchange Act), under the supervision of and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer. Based on that evaluation, our management, including the Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures, subject to limitations as noted below, as of January 31, 2011, and during the period prior to and including the date of this report, were effective to ensure that all information required to be disclosed by us in the reports that we file or submit under the Exchange Act is: (i) recorded, processed, summarized and reported, within the time periods specified in the Commission’s rule and forms; and (ii) accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. There have been no significant changes in our internal controls or in other factors that could significantly affect internal controls subsequent to January 31, 2011.

Report of Management on Internal Control Over Financial Reporting

Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rules 13-a-15(f) and 15d-15(f) under the Exchange Act as a process designed by, or under the supervision of, the Company’s principal executive and principal financial officers and effectuated by the Company’s board of directors, management and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles and includes those policies and procedures that: (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorization of management and directors of the Company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, our disclosure controls and procedures may not prevent or detect misstatements. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies and procedures may deteriorate.

We have evaluated the effectiveness of our internal control over financial reporting based on certain criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission as of the end of the period covered by this report. Based on such evaluation, management concluded that the Company’s internal control over financial reporting was effective.

There have been no material changes in internal control over financial reporting that occurred during the last fiscal quarter ended October 31, 2010, that have materially affected, or are reasonably likely to materially affect the Company’s internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1. Legal Proceedings

We are not a party to any legal or administrative proceedings that we believe, individually or in the aggregate, would be likely to have a material adverse effect on our financial condition or results of operations.

ITEM 1A . Risk Factors

Not applicable.

ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds

On February 9, 2011, we filed a report on Form 8-K disclosing the sale to 19 of our existing accredited stockholders on February 8, 2011, of an aggregate of 400,000,000 shares of our common stock, par value $0.001 (the “Shares”), at a per share price of $0.01, or $4,000,000 in the aggregate, in accordance with the terms and conditions of the Subscription Agreements made with such investors. Weng Kung Wong, our Chief Executive Officer and director, participated in the transaction and purchased 32,300,000 shares of our common stock on the same terms and conditions as the other stockholders. The Subscription Agreements contain terms and conditions that are normal and customary for a transaction of this type. The Company received net proceeds of approximately $3,989,000 from the sale of the Shares, which will be used for general corporate purposes. The Shares were sold pursuant to the exemption provided by Section 4(2) of the Securities Act of 1933, as amended and Regulation D promulgated thereunder.

ITEM 3. Defaults upon Senior Securities

None.

ITEM 4. (Removed and Reserved)

ITEM 5. Other Information

None.

ITEM 6. Exhibits

Exhibit No.		Name of Exhibit
2.1		Articles of Exchange (1)
2.2		Share Exchange Agreement, dated December 6, 2010, by and between Home Touch Holding Company, on the one hand, and Union Hub Technology Sdn. Bhn., Wooi Khang Pua and Kok Wai Chai, on the other hand (1)
2.3		Share Exchange Agreement, dated January 26, 2009, by and between Home Touch Holding Company and Home Touch Limited (2)
3.1		Amended and Restated Articles of Incorporation of Home Touch Holding Company (Incorporated by reference from Exhibit 2.1 hereto)
3.2		Amended and Restated Bylaws of Home Touch Holding Company (3)
4.1		Form of common stock certificate (1)
10.1		Common Stock Purchase Agreement, dated December 6, 2010, by and among Home Touch Holding Company, Home Touch Limited, Up Pride Investments Limited and Magicsuccess Investments Limited (1)
10.2		Form of Subscription Agreement, dated September 21, 2010, by and between Home Touch Holding Company and certain accredited investors. (4)
10.3		Form of Subscription Agreement, dated November 15, 2010, by and between Home Touch Holding Company and certain accredited investors. (5)
10.4		Tenancy Agreement (Commercial), dated October 29, 2010, by and between Atomic Vision Sdn. Bhd. and Union Hub Technology Sdn. Bhd. (1)
21		List of Subsidiaries (1)
31.1		Certification of Chief Executive Officer required under Rule 13a-14(a)/15d-14(a) under the Exchange Act.*
31.2		Certification of Principal Financial Officer required under Rule 13a-14(a)/15d-14(a) under the Exchange Act.*
32.1		Certification of Chief Executive Officer pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*
32.2		Certification of Principal Financial Officer pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*

* Filed herewith.

(1)	Incorporated by reference from our Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on February 22, 2011.

(2)	Incorporated by reference from Exhibit 2.1 to the Current Report on Form 8-K filed with the Securities and Exchange Commission on December 7, 2010.

(3)	Incorporated by reference from Amendment No. 2 to our registration statement filed on Form S-1 with the Securities and Exchange Commission on September 2, 2009.

(4)	Incorporated by reference from Exhibit 2 to the Definitive Information Statement on Schedule 14C filed with the Securities and Exchange Commission on January 5, 2011.

(5)	Incorporated by reference from Exhibit 10.1 to Current Report on Form 8-K filed with the Securities and Exchange Commission on September 27, 2010.

(6)	Incorporated by reference from Exhibit 10.1 to Current Report on Form 8-K filed with the Securities and Exchange Commission on November 15, 2010.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	PRIME GLOBAL CAPITAL GROUP INCORPORATED

Date: March 17, 2011	By:	/s/ Weng Kung Wong
		Weng Kung Wong
		Chief Executive Officer


Date: March 17, 2011	By:	/s/ Liong Tat Teh
		Liong Tat Teh
		Chief Financial Officer

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