S.A. Advisory E-Mail Update

October 6,1997

Dear E-mail Subscribers:

Take a close look at this opportunity: On Oct 4, 1997 we inform our super-fast phone service(we call you ) to purchase Bonso Electronics International warrants @ $1.00/warrant. The warrants entitles the holder to purchase one share of the common stock at $7.35/share. The warrants expire on December 14, 1999. The warrants are callable if the stock trades at or above $8.575 for 20 consecutive trading days within the 30-day period prior to the date of notice of redemption. The warrants symbol is BNSWF. The Common stock's symbol BNSOF. Both trade on the National Market System of the NASDAQ.

Bonso Electronics desisns, develops, manufactures and sells a comprehensive line of electronic scales and weighing instruments and electronic consumer and health products. The company manufactures all of its products in the People's Republic of China. The Company's electronic scales include bathroom, kitchen, office, jewelry, laboratory, pocket, postal, industrial and parcel scales that are used in consumer, commercial and industrial applications. The Company's electronic consumer and health include electronics thermometers and blood pressure meters.

At present Bonso has 2.8 million shares outstanding-(fully diluted)- management conrols over 50%. There are 2 million warrants which are controlled by the public. The current book-value is around $4.35. LTD is only $787K.

The company does business in North America, Europe and Asia. On-or-about January 8, 1997 the company moved into its new facility. The new facility will permit the company to approximately triple its productive capacity. We understand that new products and contracts are pending and we also anticipate "new" coverage from a number of Brokerage firms to be declared near-term.

The numbers look very impressive and in our opinion the upside potential appears very promising.

Select Financial Data (Year ended March 31)

                                1qrt      2qrt       3qrt        4qrt
           1996A      1997A    1998A     1998E      1998E       1988E   1998E

Sales     $14.2 Mil   $16.9 Mil $5.2Mil  $6.5Mil   $9.Mil     $12.Mil $32.Mil

share       .21       .19        .146     .21       .30         .35   $1.06

            2.8Mil   2.8Mil    2.8Mil         

If we examine the actuals and Estimate sales and earnings for BNSOF- a very interesting opportunity seems to be surfacing. Last year BNSOF had total sales of $16.9 Million and earnings of .19.. For the first Quarter of fiscal 1998 sales increased 30% over last years first quarter($3.97Mil and net income/share of .11)and net income/share increased by 27%.

In recent press releases management projects that due to the new facility, new products and contracts that business looks very favorable for fiscal 1998 and beyond.

When we examine the next three quarter's the trend is projected to continue.

We have heard that second quarter just ending September 1997 will be a barn-burner!! If we look at the whole picture for fiscal 1998, some very impressive numbers jump out at you, that is, sales are estimated to reach an eye-popping $32 Million and net income/share exploding to $1.06..

On Friday, Oct 4, 1997 BNSOF was trading @$5.625, while the warrants were trading at $1.00.

If BNSOF can actually earn what is Estimated BNSOF is only trading at 5.3X 1998 ..This indicates an undervalued situation and further investigation should be considered. If we assume that BNSOF can grow by almost 100% this year and earns could expand by over 5X--then it is quite evident that BNSOF should trade at much higher prices.. If we assign a very conservative P.E. valuation of say 15X and if BNSOF can earn what they are estimating -then the our share valuation would approach $15.90--while our warrants would have to trade at around $8.00...

Our main angle--you could buy the common at $5.75 and attain 160% gain if the common appreciates to $15.--but if you purchase the warrants--they would have to be worth around $8.--if the common appreciated to $15.--this would result in 700% gain!! This is the whole game!! If you like the idea ---PLAY the warrants BNSWF..

PSR also indicates a very cheap investment opportunity. Based upon the share price of October 4, 1997,that is $5.75 and our Estimated sales for fiscal 1998--we generate a PSR of only .50--with the estimated growth that is anticipated -BNSOF could easily trade a conservative value of 1.5X sales- this would again result in a share valuation of over $15.00 ..

Our opinion is the same for book-value---this opportunity could easily trade at 3x book--again, this would result in a share price of atleast $15.00.

If we look at cash-flow, which should equal atleast $3.5 Million for 1998-then our CF/S would equal around $1.25--our P/CF, that is 4.5X based upon our $5.75 share is again very undervalued and a value of 10X would indicate a share valuation of atleast $12.50

Bottom-line--If we look at PE,P/CF,PSR and Book-value --this is very cheap opportunity.. In our opinion, the best way to play this is by purchasing the warrants--BNSWF for greatest % GAIN. Finally--consider that other brokerage firms may start covering this issue--one should get onboard before the masses. Broker contact: Steve Muth:1-800-825-5627.

Other Stuff!!!!!!

SELL half UTEK at $31.75--recommended at $18.00 on 4-2-96 for 76% gain.. BUY----SGI at $17.875--Killed today because Merrill decided to downgrade it from BUY to Neutral--stock off $9.00---A real steal for LT investor types. Broker--Greg Nelson --1-800-269-9460.

GEGI---another aquisition to be announced within days-- look attractive at current prices ----11/16

S.A.Advisory's HOT-LINE 1-888-711-7338 ($2.00/minute) first sign-up 1-614-439-7375--$10. set-up fee Hear it here first!!

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