Hangzhou Steam Turbine Co., Ltd. Summary of Acquisition Report Date of Signature: December 2020

Stock Code: 200771 Stock ID: Hangqilun B Announcement No.: 2020-73

Hangzhou Steam Turbine Co., Ltd.

Summary of Acquisition Report

Company Name: Hangzhou Steam Turbine Co., Ltd. Listing Location: Shenzhen Stock Exchange Abbreviated Name: Hangqilun B Stock Code: 200771

Name of the acquiring Company: Hangzhou State-owned Capital Investment and Operation Co., Ltd.

Location: Room 201, No. 19, Liuying Lane, Xiacheng District, Hangzhou City, Zhejiang.

Address：14/F, Block C, Citizen Center, No.18 Jiefang East Road, Hangzhou City, Zhejiang Province

Date of signature: December 2020

杭州汽轮机股份有限公司收购报告书摘要

Statement of Acquirer

I． The summary of the report is drafted according to laws, regulations and other regulatory documents, such as the Securities Law of the People's Republic of China (hereinafter referred to as the “Securities Law”), the Administrative Measures on the Acquisition of Listed Companies

(hereinafter referred to as “the Acquisition Measures”) and Content and Format Guidelines of

Information Disclosure for Companies that Have Public Offering of Securities, Document No.

16, About the Acquisition Report of Listed Companies and etc…

II. According to the Securities Law of the People's Republic of China and the

Administrative Measures for Acquisition of Listed Companies, this report has fully disclosed the shares in which the Acquirer has interests in listed company.

As of the signing date of this report, except for the shareholding information disclosed in this report, the Acquirer owns no interest in the listed company by any other means.

III. The Acquirer has obtained necessary authorization and approval for signing this report, and its performance does not violate or conflict with any clauses in the Acquirer's articles of association or internal rules.

IV. This transaction refers to the behavior that Hangzhou SASAC transferred 90% equity of Hangzhou Turbine Group to Hangzhou Capital without compensation, which led to Hangzhou

Capital indirectly controlling 63.64% equity of Hangzhou Turbine B, and then controlling

Hangzhou Turbine B. If the acquisition meets the requirements of Item (I), Paragraph I, Article

63 of the Administrative Measures for Acquisition of Listed Companies, it may be exempted from issuing an offer.

V. The acquisition shall be conducted in accordance with the information contained in this summary of the report. Except for the professional institutions employed by the acquiring company and its person acting in concert, no other person has been entrusted or authorized to provide information not contained in this summary or to explain or interpret it.

杭州汽轮机股份有限公司收购报告书摘要

Contents

Contents Definitions

Section I Introduction of the Acquirer

Section II Acquisition Decision and Acquisition Purpose

Section III Acquisition Methods

Section IV Exemption from Offering

Section V Other Major Matters

Section VI Statement of the Acquiring Company

杭州汽轮机股份有限公司收购报告书摘要

Definitions

Unless otherwise specified, the following abbreviations shall have the following specific

meanings in this report:

Acquisition Report, this Report Refers to Acquisition Report of Hangzhou Steam Turbine Co., Ltd.

Hangzhou State-owned Capital Investment and Operation

Hangzhou Capital, the Acquirer Refers to Co., Ltd.

Hangzhou Steam Turbine Group Refers to Hangzhou Steam Turbine Power Group Co., Ltd. Hangqilun B, The listed Refers to Company Hangzhou Steam Turbine Co., Ltd. Stock Code: 200771 State-owned Assets Supervision and Administration Commission of Hangzhou Municipal People's Hangzhou SASAC Refers to Government The transaction that with the approval of Hangzhou Municipal People's Government, Hangzhou SASAC transfers 90% equity of Hangzhou Turbine Group to the This acquisition, this Refers to Acquirer free of charge, and the Acquirer indirectly transfer controlled 479,824,800 shares of Hangzhou Turbine B held by Hangzhou Turbine Group (accounting for 63.64% of the total share capital of Hangzhou Turbine B). CSRC Refers to China Securities Regulatory Commission SSE Refers to Shenzhen Stock Exchange Administrative Measures for Acquisition of Listed Measures for Acquisition Refers to Companies RMB, RMB0’000, RMB000’000’000 Refers to RMB Yuan, RMB10 thousand Yuan, RMB100 million Yuan

杭州汽轮机股份有限公司收购报告书摘要

Section I Introduction of the Acquirer

I. Basic information of the Acquirer

Company Name:Hangzhou State-owned Capital Investment and Operation Co., Ltd.

Address: Room 201, No. 19, Liuying Lane, Xiacheng District, Hangzhou City, Zhejiang.

Legal representative：Jin Xuhu

Registered capital：RMB 10,000 million

Unified Social Credit Code: 91330100MA2CFRGP3C

Company type: limited liability company (wholly state-owned)

Date of establishment: November 28, 2018

Operating period: November 28, 2018 to Long-term

Business scope: State-owned asset management within the scope of authorization of the municipal government, assets operation entrusted by the municipal government and related departments, investment and investment management and consulting services, asset management and disposal, equity management, equity investment fund management (without approval of financial and other regulatory authorities , it shall not engage in financial services such as financing deposits from the public, financing guarantees, and wealth management on behalf of clients); wholesale and retail: coal (no storage), non-ferrous metals, steel raw materials and products, wood, coke, pulp, chemical products and raw materials, asphalt ( Except for dangerous chemicals and precursor chemicals), gold products, plastic raw materials and products, general machinery, building materials, cement, rubber products, primary edible agricultural products

(except medicines), cotton, feed, fuel oil, petroleum products (except for refined oil, dangerous chemicals and easy-to-use chemicals), glass products, paper products, hardware and electrical appliances, machinery and equipment, plumbing equipment, auto parts, instrumentation, computer hardware and software and accessories, electronic products, needles, textiles; food operation; import and export of goods and technology (except for items prohibited by laws and administrative regulations, and items restricted by laws and administrative regulations can only be operated after obtaining permits); other legal items that do not need to be submitted for approval.

(Projects that are subject to approval in accordance with the law can be operated only after

杭州汽轮机股份有限公司收购报告书摘要 approval by relevant departments)

Tel:0571-87003521

II. The controlling shareholder and actual controller of the Acquirer

(I) Structure chart of controlling shareholder, actual controller and equity control of the

Acquirer

The Hangzhou SASAC is the controlling shareholder and actual controller of the Acquirer, holding 100% of the equity of the Acquirer, and the held equity of Hangzhou Turbine Power

Group Co., Ltd. is not pledged.

The Acquirer's equity control structure is as follows:

杭州市国资委

100%

杭州资本

III. A brief description of the main business of the Acquirer and the financial situation

in the last three years

(I) Main business of the Acquirer

Hangzhou Capital is an equity holding platform under Hangzhou SASAC, which was established on November 28, 2018. Hangzhou Capital is dedicated to become a professional platform for the market-oriented operation of state-owned capital, so as to implement the deployment of deepening the reform of state-owned enterprises, improve the management system of state-owned assets, promote the optimization of the layout and structural adjustment of state-owned capital, and promote the state-owned capital to become better and larger.

杭州汽轮机股份有限公司收购报告书摘要 financial and other regulatory authorities , it shall not engage in financial services such as financing deposits from the public, financing guarantees, and wealth management on behalf of clients); wholesale and retail: coal (no storage), non-ferrous metals, steel raw materials and products, wood, coke, pulp, chemical products and raw materials, asphalt ( Except for dangerous chemicals and precursor chemicals), gold products, plastic raw materials and products, general machinery, building materials, cement, rubber products, primary edible agricultural products

(Projects that are subject to approval in accordance with the law can be operated only after approval by relevant departments)

As of the signing date of this report, the basic information of the main first-level holding subsidiaries invested by the Acquirer is as follows: Registered

capital Shareholding No. Name of Main business (RMB ratio investee 10,000) Services: equity investment, investment management, private equity investment fund management, and investment Hangzhou consulting (without the approval of Strategy financial and other regulatory Emerging authorities, financial services such as 1 200,000.00 100% Industry financing deposits, financing guarantees, Investment Co., and wealth management on behalf of Ltd. customers are not allowed). (Projects that must be approved according to law can be operated only after being approved by relevant departments) Hangzhou General project: enterprise headquarters 2 50,000.00 100% Guoyou Assets management; All other legal projects

杭州汽轮机股份有限公司收购报告书摘要

Operation Co., that do not need to be submitted for Ltd. approval (except those that need to be approved according to law, business activities shall be carried out independently according to laws and the business license). Production and processing of mixed wine, bagged tea and donkey-hide gelatin products (limited to those in the operation according to the branch certificate), state-owned assets operation within the scope authorized by the Hangzhou municipal government; Industrial Huadong investment; Wholesale and retail: 3 6,000.00 100% Medicine Group chemical raw materials and products Co., Ltd. (excluding hazardous chemicals and precursor chemicals), packaging materials and pharmaceutical intermediates (excluding hazardous chemicals and precursor chemicals); Other legal items that need not be submitted for approval Services: tourism services, tourism information consultation, non-certified labor vocational skills training for Hangzhou adults; Wholesale and retail: arts and 4 Tourism Group 5,000.00 100% crafts. (Projects that must be approved Co., Ltd. according to law can be operated only after being approved by relevant departments) Holding company services; State-owned capital management within the scope authorized by the municipal government, entrusted asset management. Industrial investment; Hangzhou Lease of own assets (except financial Oxygen Plant business); Design, installation, technical 5 18,000.00 90.00% Holding Co., consultation and technical services: Ltd. general equipment, industrial and mining accessories, packaging machinery, chemical machinery, textile machinery and sewage treatment equipment; Import and export business (the specific scope is subject to the

杭州汽轮机股份有限公司收购报告书摘要

business qualification certificate of [1992] WJMGTH ZI. No. 1531); Including the business scope of subordinate branches (for projects that shall be approved according to laws, business activities can only be carried out after they are approved by relevant departments) General items: sales of renewable resources; Sales of metal materials; Sales of building materials; Sales of light building materials; Sales of coal and its products; Sales of rubber products; Supply chain management services; Sales of metal ores (except for Hangzhou projects subject to approval according to Goodwill law, business activities shall be carried 6 10,000.00 51.00% International out independently according to laws and Co.,Ltd. the business license). Permitted items: import and export of goods (for projects that shall be approved according to laws, operation activities shall be carried out only after they are approved by relevant departments, and the specific operating projects shall be subject to the approval results) (II) The financial status of the Acquirer in the last three years

The Acquirer was established on November 28, 2018. The financial status of the Acquirer in

2018 and 2019 is as follows:

RMB 10,000

Items December 31,2019 December 31, 2018

Total assets 1,991,501.98 86,765.00

Total Liabilities 752,160.10 425.68

Net assets 1,239,341.89 86,339.32

Asset-liability ratio 37.77% 0.49% Items 2019 2018

Revenue 1,224,081.11 30,213.04

Total profit 188,714.43 1,011.64

杭州汽轮机股份有限公司收购报告书摘要

Net profit 164,117.63 758.73

IV. Penalties imposed on the Acquirer in the last five years, and litigation and

arbitration involving the Acquirer

As of the signing date of this report, the Acquirer has not received administrative punishment or criminal punishment related to the securities market, nor has it involved in major civil litigation or arbitration related to economic disputes in the last five years.

V. Basic Information of the Board Directors, Supervisors and Senior Management

Members

As of the signing date of this summary of the report, the basic information of the board directors, supervisors and senior management members of the acquiring company is as follows: Whether to obtain the Name Sex Positions Nationality residency right of other countries or regions Jin Xuhu Male Chairman of the Board PRC No Vice Chairman of the Liu Jun Male Board， General PRC No Manager Zheng Wei Male Deputy General Manager PRC No Zhang Director, Financial Female PRC No Weijie Director Dong Jiqin Female Supervisor PRC No As of the signing date of this report, the above-mentioned personnel have not received administrative punishment (except those obviously unrelated to the securities market), criminal punishment, nor has it involved in major civil litigation or arbitration related to economic disputes in the last five years.

VI. The information of the shares of other listed companies held or controlled by the

Acquirer by more than 5%

(I) The information of the shares of other listed companies held or controlled by the

Acquirer by more than 5%

As of the signing date of this report, the Acquirer indirectly holds and controls more than 5% shares of other domestic and foreign listed companies as follows:

杭州汽轮机股份有限公司收购报告书摘要

Indirect Listed Registered Main control Direct No. company Stock code capital business ratio of shareholder Name （RMB 10,000) the Acquirer Hangzhou Huadong Wholesale Huadong 1 Medicine 000963.SZ 174,980.9548 and retail 16.46% Medicine Group Co., Ltd. trade Co., Ltd. Production and sales of air separation Hangzhou Hangzhou equipment, 2 Oxygen Plant 002430.SZ 96,460.3777 54.40% Oxygen Plant industrial gas Co., Ltd Holding Co., Ltd products and petrochemical equipment

(II) Other financial institutions such as banks, trust companies, securities companies

and insurance companies in which the Acquirer holds more than 5% of shares.

As of the signing date of this report, the Acquirer indirectly controls 9.99% of the shares of

Hangzhou United Rural Commercial Bank Co., Ltd. through its subsidiary Hangzhou Oxygen

Plant Co., Ltd., except that, there are no other financial institutions such as banks, trust companies,

securities companies and insurance companies in which the Acquirer holds more than 5% of

shares.

Section II Acquisition Decision and Acquisition Purpose

I. Acquisition purpose

This transfer is an important measure taken by Hangzhou Municipal People's Government to

implement the central government, Zhejiang Province and Hangzhou Municipality on

comprehensively deepening the reform spirit of state-owned enterprises.

Hangzhou SASAC established Hangzhou Capital on November 28, 2018. Hangzhou Capital, as a

professional platform for the market-oriented operation of its state-owned capital, aims to improve

the management system of state-owned assets, promote the layout optimization and structural

adjustment of state-owned capital, and promote the state-owned capital to become stronger, better

and larger. 10

杭州汽轮机股份有限公司收购报告书摘要

With the approval of Hangzhou Municipal People's Government, Hangzhou SASAC transferred

90% equity of Hangzhou Turbine Group to Hangzhou Capital free of charge.

After the completion of this transfer, Hangzhou Capital will indirectly control 63.64% of

Hangzhou Turbine B through Hangzhou Turbine Group, and the actual controller of Hangzhou

Turbine B will remain unchanged and still be the Hangzhou SASAC.

II. Procedures for acquisition performance

According to the Notice on Free Transfer of State-owned Equity of Hangzhou Steam Turbine

Power Group Co., Ltd. issued by Hangzhou SASAC on December 28, 2020 (HGZG [2020]

No.133), Hangzhou SASAC transferred 90% of the state-owned equity of Hangzhou Turbine

Group to Hangzhou State-owned Capital Investment and Operation Co., Ltd. free of charge. After the free transfer is completed, Hangzhou Capital will hold 90% equity of Hangzhou Turbine

Group, indirectly control 63.64% equity of listed company through Hangzhou Turbine Group, and become indirect controlling shareholder of listed company.

As of the signing date of this report, the acquisition has obtained the necessary authorization and approval.

III. The Acquirer's disposal plan for the rights and interests of Hangzhou Turbine B in the next 12 months

As of the signing date of this report, Hangzhou Capital has no plans to increase its holdings of

Hangzhou Turbine B or dispose of its existing rights and interests of Hangzhou Turbine Group in the next 12 months, but it does not rule out the situation that Hangzhou Capital indirectly holds the rights and interests of Hangzhou Turbine B due to the necessary capital operation due to business development and strategic needs. In case of such a situation, the Acquirer will fulfill the information disclosure obligation in a timely manner in strict accordance with the requirements of relevant laws and regulations.

杭州汽轮机股份有限公司收购报告书摘要

Section III Acquisition Methods

I. The shares of listed companies held by the Acquirer

Before the free transfer of equity, the Acquirer did not hold shares of the listed company, and the equity control relationship of the listed company is as follows:

杭州市国资委浙江省财务开发有限责任公司

90%10%

杭州汽轮动力集团有限公司

63.64%

杭州汽轮机股份有限公司

After the free transfer of shares, the Acquirer indirectly controls 63.64% of the total issued shares of the listed company through Hangzhou Turbine Group. The equity control relationship of listed companies is as follows:

杭州市国资委

100%

杭州资本浙江省财务开发有限责任公司

10% 90%

杭州汽轮动力集团有限公司

63.64%

杭州汽轮机股份有限公司 12

杭州汽轮机股份有限公司收购报告书摘要

II. Basic information of this transfer

With the approval of Hangzhou Municipal People's Government, Hangzhou SASAC transfers 90% equity of Hangzhou Turbine Group to Hangzhou Capital. After the transfer is completed, the Acquirer indirectly controls 63.64% equity of Hangzhou Turbine B through

Hangzhou Turbine Group.

III. Rights restriction of rights and interests of the acquired listed company

As of the signing date of this report, Hangzhou Turbine Group holds 479,824,800 shares of

Hangzhou Turbine B, of which 479,824,800 shares are not listed for circulation, and there is no pledge, freezing or other rights restriction.

杭州汽轮机股份有限公司收购报告书摘要

Section IV Exemption from Offering

According to Item (I) of the Para. I of Article 63 of the Measures for Acquisition, free transfer, alteration and merger of state-owned assets with the approval of the government or the state-owned assets management department, resulting in the shares in which investors have interests in a listed company accounting for more than 30% of the issued shares of the company, can be exempted from offer issuance.

In this acquisition,Hangzhou SASAC transfers 90% equity of Hangzhou Turbine Group to

Hangzhou Capital without compensation, which results in that the shares indirectly owned by

Hangzhou Capital in listed company accounts for over 30% of the issued shares of the listed company. Therefore, if this acquisition is in line with Item (1), Paragraph I, Article 63 of the

Measures for Acquisition, the Acquirer may be exempted from increasing its shareholding by way of offer.

Meanwhile, the Acquirer of this free transfer has hired a law firm to issue legal opinions on the issue of exemption from offering this time.

杭州汽轮机股份有限公司收购报告书摘要

Section V Other Major Matters

As of the signing date of this report, The Acquirer has truthfully disclosed the relevant information of this acquisition in accordance with relevant regulations, There are no other major matters that should be disclosed in connection with this acquisition, and there is no other information that CSRC or the stock exchange requires the acquiring company to provide.

杭州汽轮机股份有限公司收购报告书摘要

Section VI Statement of the Acquiring Company

I (and the institution that I represent) confirm that this summary of the report is free from

false records, misleading statements or material omissions, and bear individual and joint legal

liabilities for their authenticity, accuracy and completeness.

Acquirer (Signature and Seal): Hangzhou State-owned Capital Investment and Operation Co., Ltd.

Signature by its Legal Representative or Authorized Representative：Jin Xuhu

Date of Signature: