SecProbe.io

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								May 3, 2005
Mail Stop 0305

Via U.S. Mail

Robert Chui
Chief Financial Officer and Director
Physical Spa & Fitness Inc.
40/F. RBS Tower, Times Square
No.1 Matheson Street
Causeway Bay
Hong Kong

RE:	Physical Spa & Fitness Inc.
	Form 10-K for the fiscal year ended December 31, 2004
	File No. 0-26573

Dear Mr. Chui:

Based upon an examination restricted solely to considerations of
the
Financial Statements, Management`s Discussion and Analysis, and
Selected Financial Data, the staff has the following comments on
the
above-referenced documents.  We think you should revise all future
filings in response to these comments.  If you disagree, we will
consider your explanation as to why our comments are inapplicable
or
a revision is unnecessary.  Please be as detailed as necessary in
your response.  In some of our comments, we may ask you to provide
us
with supplemental information so we may better understand your
disclosure.  After reviewing this information, we may or may not
raise additional comments.

Please understand that the purpose of our review process is to
assist
you in your compliance with the applicable disclosure requirements
and to enhance the overall disclosure in your filing.  We look
forward to working with you in these respects.  We welcome any
questions you may have about our comments or on any other aspect
of
our review.  Feel free to call us at the telephone numbers listed
at
the end of this letter.

Please respond to confirm that such comments will be complied
with,
or, if certain of the comments are deemed inappropriate by the
Company, advise the staff of the reason thereof.

Pursuant to Rule 101(a)(3) of Regulation S-T, your response should
be
submitted in electronic form, under the label "corresp" with a
copy
to the staff.  Please respond within ten (20) business days.

Annual Report for the fiscal year ended December 31, 2004

Item 7. Management`s Discussion and Analysis of Financial
Condition
and Results of Operation
Fiscal Year Ended December 31, 2004 Compared to Fiscal Year Ended
December 31, 2003
Fiscal Year Ended December 31, 2003 Compared to Fiscal Year Ended
December 31, 2002

Your discussion regarding your operating expenses and changes in
operating expenses for the periods presented is overly general. In
future filings, please revise to include a discussion regarding
the
changes in your various categories of operating expenses (i.e.,
salaries and commissions, rent and related expense, etc) and the
factors responsible for the changes in each category of expense.
Also, your discussion of both revenues and expenses discusses the
amounts of changes in the various line items reflected in your
financial statements but not the factors responsible for the
changes
that occurred. In future filings, please revise your discussion to
include a more detailed discussion regarding the various factors
that
caused the changes in revenues and expenses reflected in your
financial statements.

In future filings, please revise to include a discussion regarding
the Company`s Critical Accounting Policies in MD&A. This
discussion
should focus on those areas where significant levels of judgment
are
required and where judgments and uncertainties affecting the
application of the policies and selection of estimates could
result
in materially different amounts being reported under different
conditions or using different assumptions. Refer to the guidance
outlined in FRR-60.

Liquidity and Capital Resources

In future filings, please revise to include a tabular summary
reflecting the Company`s various on and off-balance contractual
commitments as of the latest balance sheet date presented. Refer
to
the requirements of Item 303(a)(5) of Regulation S-K.

Item 7.A. Quantitative and Qualitative Disclosure About Market
Risk

Your current discussion regarding your exposure to foreign
exchange
rate risk does not comply with the requirements of Item 305(a) of
Regulation S-K in certain respects. In future filings, please
revise
your disclosures regarding your exposure to foreign exchange rate
risk so that they are presented in one of the suggested formats
outlined in Item 305(a)(i), (ii) or (iii) of Regulation S-K.

Consolidated Statements of Cash Flows

We note that you have reflected "assumption of capital lease
obligations" as a cash flow from financing activities in your
consolidated statements of cash flows. As this appears to be a
"non-
cash" financing activity, please revise future filings to
eliminate
this non-cash item from your consolidated statements of cash
flows.
Note however that this non-cash financing activity should be
included
in your supplemental disclosure of non-cash investing and
financing
activities. Refer to the guidance outlined in paragraph 32 of SFAS
No.95.

Also, please supplementally advise us of why "prepayments for
construction-in-progress" resulted in cash inflows of HK$1,690 and
HK$10,280 during the fiscal years ended December 31, 2003 and
2002.
We may have further comment upon receipt of your response.

Please tell us why you have reflected increases and decreases in
collateralized bank deposits and amounts due from a stockholder as
"financing activities" in your consolidated statements of cash
flow
rather than as cash flows from investing activities. Refer to the
guidance outlined in paragraphs 15 through 20 of SFAS No.95.

Note 3. Summary of Significant Accounting Policies
g) Revenue Recognition

Please tell us and clarify in future filings the period over which
non-refundable admission fee income is recognized as revenue in
the
Company`s financial statements. As part of your response, please
explain how you estimated or determined the period being used.

Note 15. Other Supplemental Information

In future filings, please revise to include the supplemental
information disclosed in Note 15 for each period presented in the
Company`s consolidated statements of operations.

Note 19. Report on Segment Information

We note from the disclosures included elsewhere in your Form 10-K
that you derive revenues from admission fees, monthly dues, and
fitness and beauty treatment services. In future filings, please
revise the notes to your financial statements to disclose the
amounts
of revenues derived from each of your principal products and
services. Refer to the requirements of paragraph 37 of SFAS
No.131.

Note 20. Unaudited Quarterly Consolidated Financial Data

We note the disclosure indicating that a management fee expense
incurred to Mighty System Limited of HK$4000 in the second quarter
of
2004 was reversed in the fourth quarter. Please tell us and
clarify
in future filings why this fee was initially recognized in the
second
quarter then subsequently reversed in the fourth quarter. We may
have
further comment upon receipt of your response.

Other

We urge all persons who are responsible for the accuracy and
adequacy
of the disclosure in the filing reviewed by the staff to be
certain
that they have provided all information investors require for an
informed decision.  Since the company and its management are in
possession of all facts relating to a company`s disclosure, they
are
responsible for the accuracy and adequacy of the disclosures they
have made.

In connection with responding to our comments, please provide, in
writing, a statement from the company acknowledging that:

* the company is responsible for the adequacy and accuracy of the
disclosure in the filing;

* staff comments or changes to disclosure in response to staff
comments do not foreclose the Commission from taking any action
with
respect to the filing; and

* the company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.

In addition, please be advised that the Division of Enforcement
has
access to all information you provide to the staff of the Division
of
Corporation Finance in our review of your filing or in response to
our comments on your filing.

* * * * *

You may contact Jean Yu at (202) 551-3305 or Linda Cvrkel, Branch
Chief, at (202) 551-3813 if you have questions regarding comments
on
the financial statements and related matters.

								Sincerely,

								Linda Cvrkel
								Branch Chief
Mr. Robert Chui
Physical Spa & Fitness
May 3, 2005
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