QXM Continues Rocket Move

On the heels of a 25% pop on Monday, QXM went up another 16% on Tuesday (and another 9% today). While I have maintained QXM is under-valued, I admit that I do not understand the catalyst for the current move. I went back and re-visited their earnings release last week and while revenues were up, margins were down and they didn't say anything very bullish. In addition, their income statement was a real head-scratcher for me (note in RMB where you divide by 6.83 to get USD)

Qiao Xing Mobile Communication Co., Ltd. and Subsidiaries
        Unaudited Condensed Consolidated Statements of Operations
         (Amounts in thousands, except share and per share data)

                                               Three months ended
                                       June 30,      March 31,    June 30,
                                         2008          2009         2009
                                          RMB           RMB          RMB

  Revenues                              383,689      460,756       578,884
  Cost of goods sold                   (250,666)    (378,498)     (446,306)
  Gross profit                          133,023       82,258       132,578
  Selling and distribution
   expenses                             (33,153)     (20,740)      (31,727)
  General and administrative
   expenses                             (12,680)     (11,988)      (11,922)
  Research and development
   expenses                              (7,963)      (6,992)       (6,487)
  Amortization of intangible
   assets                                (3,158)      (1,190)       (1,190)
  Operating income                       76,069       41,348        81,252
  Interest income                         6,589        4,185         2,789
  Interest expense                      (35,635)     (68,724)      (82,770)
  Foreign exchange (loss) gain,
   net                                   (2,502)         654          (172)
  Gain (loss) on remeasurement of
   embedded derivatives                 113,730       42,137       (51,635)
  Other (loss) income, net               (3,975)         136          (198)
  Income (loss) before income tax
   expense                              154,276       19,736       (50,734)
  Income tax expense                    (19,005)     (12,665)      (15,488)
  Net income (loss)                     135,271        7,071       (66,222)
  Net income attributable to
   noncontrolling interests              (1,863)        (756)       (2,155)
  Net income(loss) attributable to
   holders of ordinary
   shares                               133,408        6,315       (68,377)

  Income (loss) per ordinary share:
  Basic                                    2.46         0.10         (1.44)
  Diluted                                  0.82         0.10         (1.44)

  Weighted average number of
   shares outstanding:
  Basic                              49,467,000   47,610,000    47,610,000
  Diluted                            54,333,000   47,610,000    47,610,000

The item that caused the scratching was interest expense.  Why is it going up so much? What the heck is it for?
I didn't get it... I don't see much debt on their books.