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1 Morning Research Department Table of Contents 目录 4 November 2016 Hong Kong Economic Focus 香港经济焦点 Industry and Company Focus 行业和公司焦点 Great Wall Motor (02333 HK): Vehicles Sales Increased 30.6% YoY in Oct 长城汽车 (02333 HK): 2016 年 10 月汽车销售同比增长 30.6% Lenovo (00992 HK): 2QFY17 Results below Market Expectations 联想 (00992 HK): 2017 财年第 2 季度业绩差于市场预期 Latest Reports 最新报告摘要 Company Name 公司名称 Powerlong Estate 宝龙地产 CRRC Corporation 中国中车 China Airlines 中国东方航空 Real Eastern Code 代码 HK HK HK HK HK HK Title 标题 Share Price Partially Reflects Fundamentals, Downgrade to "Accumulate" 股价反映了部分基本面, 下调至 收集 3Q Results Below Expectation but Rebound Expected in FY17,Maintain Accumulate 3 季度业绩差于预期但预计 2017 年有好转, 维持 收集 Fast Passenger Growth but RMB Depreciation May Cause Turbulence Ahead 客运增长快速, 但人民币贬值将带来波动 TP 目标价 Chg 变动 Rating 评级 Chg 变动 EPS Est. Change? 盈利预测 是否改变 HK$2.86 Accumulate Y HK$2.86 收集 是 HK$7.30 Accumulate -- Y HK$7.30 收集 -- 是 HK$3.77 Accumulate -- Y HK$3.77 收集 -- 是 Newly Published Key Economic Data for China, US and Europe 中美欧最新公布的重要经济数据 See the last page for disclaimer Page 1 of 10

2 Appendices:Chinese Version of the Industry and Company Focus, Latest Reports. 后附 : 行业和公司焦点, 最新报告摘要中文版 HSI Performance HSCEI Performance 29,000 16,000 27,000 25,000 14,000 12,000 23,000 21,000 19,000 10,000 8,000 17,000 Nov/15 Feb/16 May/16 Aug/16 Nov/16 Source: Bloomberg 6,000 Nov/15 Feb/16 May/16 Aug/16 Nov/16 Source: Bloomberg Hong Kong Economic Focus (Johnny Wong) 香港经济焦点 ( 王俊浩 ) Hong Kong Census and Statistics Department released retail sales statistics for September The provisional value of total retail sales in September 2016 was HKD33.8 billion, representing a 4.1% YoY fall. The decrease in retail sales in September improved notably from last month, which experienced a slump of 10.5% YoY. The provisionally estimate of total retail sales decreased by 9.6% YoY from January to September In terms of types of goods sold, the value of sales of jewellery, watches and clocks, and valuable gifts decreased by 12.3% YoY, the largest drop among all categories. We believe that the improvement in retail sales in September was mainly attributable to the rebound in visitor arrivals. Pessimistic domestic consumer sentiment, depreciation of Chinese Yuen against USD and external uncertainties brought by the presidential election in the US may continue to haunt the performance of total retail sales in the next couple of months. Given our view that visitor arrivals will rebound in the 4Q16, we expect the negative growth in retail sales to narrow for the rest of 2016, but a turnaround is unlikely. 香港政府统计处发表 2016 年 9 月零售业销货额统计数字 2016 年 9 月零售业总销货价临时值为 338 亿港元, 按年下降 4.1% 9 月份零售销售额的下降较上月 10.5% 的按年同比跌幅明显好转 临时估计零售业总销货额较 2016 年 1 月至 9 月按年下跌 9.6% 就销售货品类别而言, 珠宝, 钟表及有价值礼品的销售价值为跌幅最大, 按年下降 12.3% 我们认为 9 月份零售业销货额有所改善, 主要是由于旅客人数反弹所致 悲观的国内消费者情绪, 人民币兑美元贬值和美国总统选举带来的外部不确定性可能继续困扰未来几个月的零售总销售额 鉴于我们认为访港旅客将在 2016 年第四季反弹, 我们预计 2016 年余下时间的零售销售额跌幅将会减少, 但由负转正的可能性不大 See the last page for disclaimer Page 2 of 10

3 Industry and Company Focus Great Wall Motor (02333 HK): Vehicles Sales Increased 30.6% YoY in Oct Analyst: Toliver Ma What happened: Great Wall Motor ( GWM ) announced its Oct sales data. Vehicle sales were 80,292 units in October, up 30.6% YoY. SUV and pickup sales increased 40.0% and 8.0% YoY, respectively, while sedan sales dropped 29.6% YoY. In the first 10 months of 2016, vehicle sales of GWM increased 19.2% YoY to 794,836 units. Comments and Views: Strong vehicle sales growth continued in Oct. 2016, recording high double-digit growth of 30.6%. Strong sales were mainly driven by star SUV model of Haval H6, which has increased 51.0% yoy and comprised of 62.8% of YTD Oct SUV sales (YTD Oct. 2015: 53.2%). On the other hand, sales of Haval H7 continue to rise and reached 6,134 units in this month, and a new long wheel base H7L will introduce soon, and should continue to support sales. We believe sales momentum would continue due to the expiration of the current purchase tax cut policy in 31 Dec. 2016, which should bring forward vehicle purchase to 2016 should no other stimulus policies release in the forth quarter. Therefore, we continue to believe GWM to achieve current year target of 950,000 units. Investment suggestion: GWM continue to use all forms of promotions to defend its market shares, which the Company has currently launched a low / zero interest vehicle financing loan for Haval buyers. By pursuing a more volume oriented strategy, it hurts its gross margin. Nonetheless, we think that gross margin is dropping at a slower rate as cost benefit can be obtain from better utilization and higher proportion of H6 sales. The Company has an investment rating of Buy and a TP of HK$9.29, representing 8.3x 2016 PER, 8.0x 2017 PER, 1.6x 2016 PBR and 1.4x 2017 PBR. Lenovo (00992 HK): 2QFY17 Results below Market Expectations Analyst: Ricky Lai What happened: Lenovo announced the following results: USD 2QFY17 yoy 1HFY17 yoy Revenue 11.2 Billion (8%) 21.3 Billion (7%) Shareholder s Profit 157 million n.a. 330 million n.a. EPS 1.42 cents n.a cents n.a. Source: the Company. Comments and Views: Lenovo s 2QFY17 net profit was 82% below market expectations but in-line with our expectation. Lenovo s PC shipments in 2QFY17 were 14.5 million, down 3.2% yoy, which was similar to the market average with -3.9%. 2QFY17 gross profit margin improved 1.3 ppt yoy to 14.3%, driven by better product mix with the launch of high end smartphones and PC products. Lenovo is shifting its mobile development strategy from low end to mid and high end smartphones by launching Moto Z and Moto Mods. We expect the change to high end smartphone strategy will result in decline in mobile shipments but ASP will rebound.lenovo recorded yoy decline in all of its core businesses including PC, mobile and data centers in 1H16 due to decline in product shipments with sluggish market demand and fierce market competition. Although the global smartphone shipments showed 1% growth in 3Q16, better than 0.3% in 2Q16, and we expect there will have little improvement to Lenovo. Lenovo is in discussion with Fujitsu for potential co-operation in terms of R&D, sales and marketing. The co-operation with Fujitsu can barely help the Company to improve growth owning to weak PC demand. We will maintain the Company s earnings estimations. Investment suggestion: The Company s present investment rating is Reduce with TP of HK$4.80. See the last page for disclaimer Page 3 of 10

4 We maintain the Company s TP. The Company can turn profitable in last quarter thanks to cost cut and savings such as layoffs, we think this business model cannot be sustain instead of revenue growth. Latest Reports Powerlong Real Estate (01238 HK): Share Price Partially Reflects Fundamentals, Downgrade to "Accumulate" Rating: Accumulate 6-18m TP: HK$2.86 Analyst: Van Liu Report Date: Summary Powerlong Real Estate s ("Powerlong") future revenue growth should be stable. During Jan. to Sep. 2016, Powerlong recorded RMB bn in contracted sales, up 14.5% YoY. We also expect rental income to increase at a CAGR of 24.8% between We expect Powerlong's margins to be consolidated. Gross margins are expected to maintain around 34.5% between due to a quality land bank and reasonable unit land cost (13.2% of ASP in 1H16). In addition, funding costs could decline further. Total revenue increased 31.6% YoY to RMB6.225 bn in 1H16. Underlying net profit soared by 48.4% YoY to RMB0.896 bn, which was in line with our expectation. we revise down the underlying net profit forecasts by 7.6%, 19.6% and 27.3% to RMB1,755 mn, RMB1,968 mn and RMB2,264 mn in 2016, 2017 and 2018, respectively. Successful commercial operation coupled with expected strong rental income growth should justify a higher valuation. Overall, we revise up the target price from HK$2.30 to HK$2.86, which represents a 40% discount to 2016E NAV of HK$4.77 per share and implies 5.6x 2016 underlying PER and 0.4x 2016 PBR. We think that the Company's share price has partially reflected its fundamentals. Therefore, we downgrade our investment rating from Buy to "Accumulate". Risk: lower-than-expected house sales. CRRC Corporation (01766 HK): 3Q Results Below Expectation but Rebound Expected in FY17,Maintain Accumulate Rating: Accumulate 6-18m TP: HK$7.30 Analyst: Gary Wong Report Date: Summary CRRC Corporation s (01766 HK) 9M16 revenue decreased 1.0% YoY to RMB147.1 billion. Net profit decreased 5.5% YoY to RMB7.5 billion. Results were below expectations. The decline in revenue was a result of the later-than-expected new bid from CRC. Gross margin for 9M16 increased 0.4 ppts YoY to 22.5%, whereas that of 3Q16 dropped 1.1 ppts YoY to 21.6%. Railway equipment revenue was below expectation due to a delay in orders. However, we found that passenger transportation remained strong with 10% growth. Thus, demand for EMU should remain strong as well. We expect railway equipment revenue growth to rebound to 12.0% and to 8.5% in 2017 and 2018, respectively. Considering the NDRC s planning schedule and expected increase in investment in urban transit railways, we expect revenue from RTV and the urban infrastructure segment to increase at a CAGR of 11.9% between Our EPS estimates are RMB0.402, RMB0.425 and RMB0.503 for FY16-FY18, respectively. We expect CAGR of 6.4% and 5.1% for revenue and EPS, respectively. We think the company s potential is limited by weak demand, which is expected to improve in We slightly lower the TP at HKD7.30, representing 15.8x/14.9x/12.6x FY16/FY17/FY18 PE and Maintain Accumulate. See the last page for disclaimer Page 4 of 10

5 China Eastern Airlines (00670 HK): Fast Passenger Growth but RMB Depreciation May Cause Turbulence Ahead Rating: Accumulate 6-18m TP: HK$3.77 Analyst: Toliver Ma Report Date: Summary China Eastern Airlines ( CEA ) 1-3Q16 shareholders profit increased 25.5% yoy to RMB 6,694 million, below market expectations. Revenue grew by 4.8% yoy to RMB 75,408 million, driven by strong RPK growth of 14.4% yoy. Yield per RPK continued to drop, but at a slower rate in 3Q16. Low oil prices continue to benefit the Company with lower fuel costs. Finance costs also decreased 20.3% yoy as the RMB depreciated less significantly during the first 3 quarters. We revise down our earnings forecasts for 2016 to 2018 by 20.7%, 10.9% and 12.2%, respectively. Due to the worsening RMB deprecation trend, we increase our forecasts on exchange loss by 50.6% in 2016 or RMB 869 million in absolute terms. Moreover, we revise down the growth of ASK due to expectation of slower investment in the future, and upgrade PLF as the utilization in the first 3 quarters in 2016 was better than expected. Maintain investment rating as Accumulate. CEA is growing fast with RPK and PLF both leading among the big 3 carriers. Although yield per RPK is trending down, the decrease slowed in 3Q and should get better as capacity investment will not be as aggressive. However, since the depreciation of the RMB is worsening in 4Q, there should be an adverse impact in net profit growth. Therefore, we revise down target price to HK$3.77, representing 7.9x 2016 PER, 6.7x 2017 PER, 0.9x 2016 PBR and 0.8x 2017 PBR. Newly Published Key Economic Data for China, US and Europe 中美欧最新公布的重要经济数据 Country 国家 Indicator 指标名称 Data Period 数据期间 Current Value 当期值 MoM / QoQ 环比变动 YoY 同比变动 Market Consensus 市场一致预期 U.S. 美国 Factory Orders SA (mom) 经季调工厂订单环比 September 9 月 0.3% (0.1ppts) 1.1ppts 0.2% U.S. 美国 Durable Goods New Orders SA (mom) 经季调耐用品订单环比 Source:U.S. Census Bureau,Bloomberg. 数据来源 : 美国人口普查局 彭博 September 9 月 (0.3%) (0.5ppts) 0.5ppts (0.1%) See the last page for disclaimer Page 5 of 10

6 Chinese Translation 中文翻译 行业和公司焦点 长城汽车 (02333 HK): 2016 年 10 月汽车销售同比增长 30.6% 分析员 : 马守彰 事件描述 : 长城汽车公告了其 2016 年 10 月份的汽车销售数据 10 月的汽车销量为 80,292 辆, 同比增长 30.6% SUV 和皮卡分别同比增长 40.0% 和 8.0%, 而轿车同比下滑 29.6% 2016 年 10 月长城汽车累计销售 794,836 辆汽车, 同比增长 19.2% 观点评论 :2016 年 10 月持续强劲的汽车销量增长, 录得 30.6% 的高双位数的增长 强大的销售主要由星级 SUV 车型哈弗 H6 所带动, 同比增长 51.0%, 并占 2016 年 10 月 SUV 累计销售的 62.8%(2015 年 10 月 :53.2%) 另一方面, 哈弗 H7 的销量继续上升, 本月达到 6,134 台, 新的长轴版 H7L 即将推出, 并应继续支持销售 我们认为因当前的购置税减半政策将于 2016 年 12 月 31 日到期, 销售势头将能持续, 如在第 4 季度没有新的刺激政策推出, 这将提前汽车消费至 2016 年 因此, 我们认为长城汽车将能达到今年的 95 万台的销售目标 投资建议 : 长城汽车继续使用各种形式的推广活动来维护其市场份额, 公司最近推出了低 / 零利息车辆融资贷款给哈弗买家 通过采取以数量为导向的策略, 其毛利率会受到负面影响 尽管如此, 我们认为毛利率正在以较慢的速度下降, 因为更好利用率和较高的哈弗 H6 销售比例获得成本效益 目前公司的的投资评级为 买入 及 9.29 港元的目标价, 相当于 8.3 倍 2016 年市盈率和 8.0 倍 2017 年市盈率, 1.6 倍 2016 年市净率和 1.4 倍 2017 年市净率 联想 (00992 HK): 2017 财年第 2 季度业绩差于市场预期 分析员 : 黎柏坚 事件描述 : 联想公布业绩为以下 : 美元 2017 财年第 2 季度同比 2017 财年上半年同比 收入 112 亿 (8%) 213 亿 (7%) 股东纯利 1.57 亿 n.a. 3.3 亿 n.a. 每股纯利 1.42 分 n.a 分 n.a. 来源 : 公司 观点评论 : 联想的 2017 财年第 2 季度纯利差于市场预期 82%, 但符合我们的预期 联想第 2 季度的电脑出货量为 14.5 百万台, 同比下降 3.2%, 与市场平均水平 -3.9% 相近 第 2 季度毛利率同比升 1.3 个百分点至 14.3%, 因推出高端智能手机和电脑产品 联想通过推出 Moto Z 和 Moto Mods, 将其手机发展战略从低端转至中高端智能手机 我们预计高端智能手机的策略将导致手机出货量下降, 但平均售价将可反弹 联想所有核心业务, 包括 PC 移动和数据中心在 2016 年上半年录得同比下降, 因为产品出货量下降 市场需求低迷和激烈的市场竞争 虽然全球智能手机出货量在 2016 年第三季度显示 1% 的增长, 好于 2016 年第二季度的 0.3%, 我们预计对联想的改善不大 联想与富士通在研发 销售和营销方面的潜在合作正在讨论 我们预计与富士通的合作不能帮助公司在计算机需求疲软的情况下改善增长 我们将维持公司的盈利预测 See the last page for disclaimer Page 6 of 10

7 投资建议 : 公司现时的投资评级为 减持 及目标价为 4.80 港元 我们维持公司的目标价 公司在上个 季度可录得盈利, 因通过费用的减省如裁员, 我们认为这种商业模式不能持续, 而应通过收入增长 最新报告 宝龙地产 (01238 HK): 股价反映了部分基本面, 下调至 收集 评级 : 收集 6-18m 目标价 : HK$2.86 分析员 : 刘斐凡 报告日期 : 报告摘要 宝龙地产 (" 宝龙 ") 未来的收入增长应是稳定的 2016 年 1-9 月, 宝龙录得人民币 亿元的合约销售, 同比上升 14.5% 我们也预计租金收入将会在 年以 24.8% 的年复合增长率增长 我们预计宝龙的利润率将被巩固 由于有质量的土储且合理的单位地价 (2016 年上半年销售均价的 13.2%), 毛利率将在 2016 到 2018 年维持在 34.5% 左右 另外, 融资成本能够进一步降低 2016 年上半年总收入同比增长 31.6% 至人民币 亿元 核心净利润同比迅猛增长 48.4% 至人民币 8.96 亿元, 符合我们预期 我们分别将 2016,2017 和 2018 年核心净利预测上调 7.6%,19.6% 和 27.3% 至人民币 亿元, 人民币 亿元和人民币 亿元 成功的商业运营及强劲租金收入增长预期应适用更高的估值 整体而言, 我们将目标价从 2.30 港元上调至 2.86 港元, 相当于 2016 年每股估值 4.77 港元有 40% 的折让,5.6 倍 2016 年核心市盈率和 0.4 倍 2016 年市净率 我们认为公司股价已经部分反映了其基本面 因此, 我们将投资评级从 买入 下调至 收集 风险: 低于预期的房屋销售 中国中车 (01766 HK): 3 季度业绩差于预期但预计 2017 年有好转, 维持 收集 评级 : 收集 6-18m 目标价 : HK$7.30 分析员 : 黄家玮报告日期 : 报告摘要 中国中车 (01766 HK)2016 年前 9 个月收入同比跌 1.0% 至 1471 亿元 ( 人民币, 下同 ) 纯利同比跌 5.5% 至 75 亿元 业绩差于预期 收入下降是由于铁总新订单发放时间迟于预期 前 9 个月毛利率同比提高 0.4 个百分点至 22.5%, 但 3 季度单季度毛利率则同比下降 1.1 个百分点至 21.6% 由于新订单的延迟, 铁路设备分部的收入差于预期 但是, 我们发现乘客运输已经表现强劲维持在 10% 增速 因此, 我们认为动车组的需求也依旧强劲 我们预测铁路设备收入增长将在 2017 年和 2018 年分别反弹至 12.0% 和 8.5% 考虑到发改委的城轨规划和预计上涨的城轨投资, 我们预测城轨与城市基础设施分部收入将在 2015 至 2018 年保持 11.9% 的年复合增长 我们预测的 年每股盈利分别是 元 元及 元 我们预测收入和每股盈利将在 年分别保持 6.4% 和 5.1% 的年复合增长 我们认为公司的潜力受制于当下疲软的需求, 但是情况也许会在 2017 年有所改善 轻微下调目标价至 7.30 港元, 对应 15.8/14.9/12.6 倍的 2016/2017/2018 年预期市盈率 维持 收集 评级 See the last page for disclaimer Page 7 of 10

8 中国东方航空 (00670 HK): 客运增长快速, 但人民币贬值将带来波动评级 : 收集 6-18m 目标价 : HK$3.77 分析员 : 马守彰报告日期 : 报告摘要 东方航空在 2016 首 3 季度股东净利润同比上升 25.5% 至人民币 6,694 百万元, 低于市场预期 由于强劲的收入客公里同比增长 14.4%, 收入同比增长 4.8% 至人民币 75,408 百万元 每收入客公里收益继续下降, 但第 3 季度下降速度较慢 公司继续受益于低油价, 使燃油成本降低 因为人民币在首 3 季度的贬值较为温和, 财务成本同比下降 20.3% 我们对 年的盈利预测分别下调 20.7%,10.9% 及 12.2% 由于人民币贬值趋势恶化, 我们对汇兑损失在 2016 年的预测增加 50.6% 或人民币 869 百万元 此外, 我们下调可用座位公里的增长, 因为预计未来的投资会减慢, 并提升客载率, 因首 3 季度好于预期的利用率 维持投资评级为 收集 东方航空正在快速增长, 收入客公里和客载率都领先于 3 大航空公司 虽然每收入客公里收益有下降趋势, 但是在第三季度下降已经放缓, 并预计会好转, 因为运力投资将较为温和 然而, 由于人民币贬值在第 4 季度恶化, 对其净利润增长有负面影响 因此, 我们下调目标价至 3.77 港元, 相当于 7.9 倍 2016 年市盈率和 6.7 倍 2017 年市盈率,0.9 倍 2016 年市净率和 0.8 倍 2017 年市净率 See the last page for disclaimer Page 8 of 10

9 Research Department 研究部 Grace Liu 刘谷 Head of Research, Market Strategy, Petrochemicals 主管, 市场策略 石化 (852) Noah Hudson Noah Hudson Consumer (Hotels), Gaming 消费 ( 酒店 ) 博彩 [email protected] (86755) Gary Wong 黄家玮 Environmental Protection, Infrastructure 环保 基建 [email protected] (852) Leo Wu 吴逸超 Coal, Electricity 煤炭 电力 [email protected] (86755) Ray Zhao 赵睿 Conglomerate, E-commerce 综合 电子商务 [email protected] (86755) Square Chui 徐惠芳 Futures 期货 [email protected] (852) Kevin Guo 郭勇 Raw Materials, Gas 原材料 燃气 [email protected] (86755) Ricky Lai 黎柏坚 Telecommunications, Internet 电信 互联网 [email protected] (852) Dayton Wang 王庆鲁 Insurance, Fixed-income 保险 债券 [email protected] (852) Richard Cao 曹柱 Banking 银行 [email protected] (86755) Jun Zhu 朱俊杰 Clean Energy, Electric Equipment 清洁能源 电力设备 [email protected] (852) Andrew Song 宋涛 Consumer (Retailing), Home Appliances 消费 ( 零售 ) 家电 [email protected] (852) Van Liu 刘斐凡 Property 房地产 [email protected] (86755) Sean Xiang 向宇豪 Machinery, Construction Materials 机械 建材 [email protected] (86755) Terry Hong 洪学宇 Consumer (Apparel) 消费 ( 服装 ) [email protected] (86755) Johnny Wong 王俊浩 Macroeconomics, Property 宏观 房地产 [email protected] (852) Toliver Ma 马守彰 Aviation, Automobiles & Components 航空 汽车 [email protected] (852) Spencer Fan 范明 Shipping & Logistics, Ports, 航运物流 港口 [email protected] (86755) Barney Wu 吴宇扬 Consumer (Food & Beverage, Household Products) 消费 ( 食品饮料 日用品 ) [email protected] (86755) Gary Ching 程嘉伟 Market Strategy 市场策略 [email protected] (852) Jake Wang 汪昌江 Research Assistant 研究助理 [email protected] (86755) Wiley Huang 黄重钧 Research Assistant 研究助理 [email protected] (852) Danny Law 罗沛达 Research Assistant 研究助理 [email protected] (852) David Liu 刘静骁 Research Assistant 研究助理 [email protected] (852) Kay Mai 麦梓琪 Research Assistant 研究助理 [email protected] (86755) Esabella Zhao 赵舒蔓 Research Assistant, Translator 研究助理 翻译员 [email protected] (86755) Penny Pan 潘凌蕾 Secretary, Translator 秘书 翻译员 [email protected] (852) See the last page for disclaimer Page 9 of 10

10 Company Rating Definition The Benchmark: Hong Kong Hang Seng Index / NASDAQ Composite Index Time Horizon: 6 to 18 months Rating Definition Buy Relative Performance >15%; or the fundamental outlook of the company or sector is favorable. Accumulate Relative Performance is 5% to 15%; or the fundamental outlook of the company or sector is favorable. Neutral Relative Performance is -5% to 5%; or the fundamental outlook of the company or sector is neutral. Reduce Relative Performance is -5% to -15%; or the fundamental outlook of the company or sector is unfavorable. Sell Relative Performance <-15%; or the fundamental outlook of the company or sector is unfavorable. Sector Rating Definition The Benchmark: Hong Kong Hang Seng Index / NASDAQ Composite Index Time Horizon: 6 to 18 months Rating Definition Outperform Relative Performance >5%; or the fundamental outlook of the sector is favorable. Neutral Relative Performance is -5% to 5%; or the fundamental outlook of the sector is neutral. Underperform Relative Performance <-5%; or the fundamental outlook of the sector is unfavorable. DISCLOSURE OF INTERESTS (1) Except for Shenzhen International Holdings Limited (00152 HK), the Analysts and their associates do not serve as an officer of the issuer mentioned in this Research Report. (2) The Analysts and their associates do not have any financial interests in relation to the issuer mentioned in this Research Report. (3) Except for SMI Holdings Group Limited (00198 HK), China All Access (Holdings) Limited (00633 HK), Guotai Junan International Holdings Limited (01788 HK), Binhai Investment Company Limited (02886 HK) and Link Holdings Limited (08237 HK), Guotai Junan and its group companies do not hold equal to or more than 1% of the market capitalization of the issuer mentioned in this Research Report. (4) Guotai Junan and its group companies have had investment banking relationships with Zhejiang Expressway- H shares (00576 HK) / Modern Land (01107 HK) / GOME Electrical Appliances (00493 HK) / China Wood Optimization (01885 HK) / Anhui Conch Cement- H shares (00914 HK) / 361 Degrees (01361 HK) / China All Access (00633 HK) / Huaneng Renewables- H shares (00958 HK) / Hengdeli (03389 HK) / Sundart Holdings Ltd. (01568 HK) / China Dredging Environment Protection (00871 HK) / AviChina Industry & Technology- H shares (02357 HK) / China Power (02380 HK) / Sinotruk (03808 HK) / Xiao Nan Guo Restaurants (03666 HK) / China Aoyuan Property (03883 HK) / SMI Holdings Group (00198 HK) / Chanjet Information Technology- H shares (01588 HK) / Tianyun International (06836 HK) / China U-Ton (06168 HK) / Huaneng Power- H shares (00902 HK) / Shanghai Electric- H shares (02727 HK) / Powerlong Real Estate (01238 HK) / Huishang Bank- H shares (03698 HK) / Bosideng (03998 HK) / WH Group (00288 HK) mentioned in this Research Report within the preceding 12 months. DISCLAIMER This Research Report does not constitute an invitation or offer to acquire, purchase or subscribe for securities by Guotai Junan Securities (Hong Kong) Limited ("Guotai Junan"). Guotai Junan and its group companies may do business that relates to companies covered in research reports, including investment banking, investment services and etc. (for example, the placing agent, lead manager, sponsor, underwriter or invest proprietarily). Any opinions expressed in this report may differ or be contrary to opinions or investment strategies expressed orally or in written form by sales persons, dealers and other professional executives of Guotai Junan group of companies. Any opinions expressed in this report may differ or be contrary to opinions or investment decisions made by the asset management and investment banking groups of Guotai Junan. Though best effort has been made to ensure the accuracy of the information and data contained in this Research Report, Guotai Junan does not guarantee the accuracy and completeness of the information and data herein. This Research Report may contain some forward-looking estimates and forecasts derived from the assumptions of the future political and economic conditions with inherently unpredictable and mutable situation, so uncertainty may contain. Investors should understand and comprehend the investment objectives and its related risks, and where necessary consult their own financial advisers prior to any investment decision. This Research Report is not directed at, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in any jurisdiction where such distribution, publication, availability or use would be contrary to applicable law or regulation or which would subject Guotai Junan and its group companies to any registration or licensing requirement within such jurisdiction Guotai Junan Securities (Hong Kong) Limited. All Rights Reserved. 27/F., Low Block, Grand Millennium Plaza, 181 Queen s Road Central, Hong Kong. Tel.: (852) Fax: (852) Website: See the last page for disclaimer Page 10 of 10