CHANGCHENG PROPERTY GROUP CO., LTD.* 長城物業集團股份有限公司 (The “Company”) (A Joint Stock Company Incorporated in the People’S Republic of China with Limited Liability)

The Stock Exchange of Hong Kong Limited and the Securities and Futures Commission take no responsibility for the contents of this Application Proof, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this Application Proof. Application Proof of CHANGCHENG PROPERTY GROUP CO., LTD.* 長城物業集團股份有限公司 (the “Company”) (A joint stock company incorporated in the People’s Republic of China with limited liability)

WARNING The publication of this Application Proof is required by The Stock Exchange of Hong Kong Limited (the “Stock Exchange”) and the Securities and Futures Commission (the “Commission”) solely for the purpose of providing information to the public in Hong Kong. This Application Proof is in draft form. The information contained in it is incomplete and is subject to change which can be material. By viewing this document, you acknowledge, accept and agree with the Company, its joint sponsors, advisors or members of the underwriting syndicate that: (a) this document is only for the purpose of providing information about the Company to the public in Hong Kong and not for any other purposes. No investment decision should be based on the information contained in this document; (b) the publication of this document or supplemental, revised or replacement pages on the Stock Exchange’s website does not give rise to any obligation of the Company, its joint sponsors, advisors or members of the underwriting syndicate to proceed with an offering in Hong Kong or any other jurisdiction. There is no assurance that the Company will proceed with the offering; (c) the contents of this document or supplemental, revised or replacement pages may or may not be replicated in full or in part in the actual final listing document; (d) the Application Proof is not the final listing document and may be updated or revised by the Company from time to time in accordance with the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited; (e) this document does not constitute a prospectus, offering circular, notice, circular, brochure or advertisement offering to sell any securities to the public in any jurisdiction, nor is it an invitation to the public to make offers to subscribe for or purchase any securities, nor is it calculated to invite offers by the public to subscribe for or purchase any securities; (f) this document must not be regarded as an inducement to subscribe for or purchase any securities, and no such inducement is intended; (g) neither the Company nor any of its affiliates, its joint sponsors, advisors or members of its underwriting syndicate is offering, or is soliciting offers to buy, any securities in any jurisdiction through the publication of this document; (h) no application for the securities mentioned in this document should be made by any person nor would such application be accepted; (i) the Company has not and will not register the securities referred to in this document under the United States Securities Act of 1933, as amended, or any state securities laws of the United States; (j) as there may be legal restrictions on the distribution of this document or dissemination of any information contained in this document, you agree to inform yourself about and observe any such restrictions applicable to you; and (k) the application to which this document relates has not been approved for listing and the Stock Exchange and the Commission may accept, return or reject the application for the subject public offering and/or listing. If an offer or an invitation is made to the public in Hong Kong in due course, prospective investors are reminded to make their investment decisions solely based on the Company’s prospectus registered with the Registrar of Companies in Hong Kong, copies of which will be distributed to the public during the offer period. THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. IMPORTANT

If you are in any doubt about any of the contents of this document, you should seek independent professional advice.

CHANGCHENG PROPERTY GROUP CO., LTD.* 長城物業集團股份有限公司 (A joint stock company incorporated in the People’s Republic of China with limited liability) [REDACTED]

Number of [REDACTED] under : [REDACTED] H Shares (subject to the the [REDACTED] [REDACTED]) Number of [REDACTED] : [REDACTED] H Shares (subject to adjustment) Number of [REDACTED] : [REDACTED] H Shares (subject to adjustment and the [REDACTED]) Maximum [REDACTED] : HK$[REDACTED] per H Share, plus brokerage of 1%, SFC transaction levy of 0.0027% and Stock Exchange trading fee of 0.005% (payable in full on application in Hong Kong dollars and subject to refund) Nominal Value : RMB1.00 per H Share Stock Code : [REDACTED] Joint Sponsors

[REDACTED] and [REDACTED] [REDACTED]

Hong Kong Exchanges and Clearing Limited, The Stock Exchange of Hong Kong Limited and Hong Kong Securities Clearing Company Limited take no responsibility for the contents of this document, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this document. A copy of this document, having attached thereto the documents specified in the section headed “Documents Delivered to the Registrar of Companies and Available for Inspection” in Appendix VIII to this document, has been registered by the Registrar of Companies in Hong Kong as required by Section 342C of the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Chapter 32 of the Laws of Hong Kong). The Securities and Futures Commission and the Registrar of Companies in Hong Kong take no responsibility for the contents of this document or any other document referred to above. Prior to making an investment decision, prospective investors should consider carefully all of the information set out in this document, including but not limited to the risk factors set out in the section headed “Risk Factors’ in this document. The [REDACTED] is expected to be determined by agreement between the [REDACTED] (for themselves and on behalf of the [REDACTED]) and our Company on the [REDACTED]. The [REDACTED] is expected to be on or around [REDACTED] (Hong Kong time) and, in any event, not later than [REDACTED] (Hong Kong time) unless otherwise announced. The [REDACTED] will not be more than HK$[REDACTED] per [REDACTED] and is currently expected to be not less than HK$[REDACTED] per [REDACTED] unless otherwise announced. If, for whatever reason, the [REDACTED] is not agreed between the [REDACTED] (for themselves and on behalf of the [REDACTED]) and our Company on or before [REDACTED] (Hong Kong time) or such other date as announced, the [REDACTED] (including the [REDACTED]) will not proceed and will lapse. The [REDACTED] (for themselves and on behalf of the [REDACTED]) may, with our consent, reduce the number of [REDACTED] being offered under the [REDACTED] and/or the indicative [REDACTED] range below as stated in this document at any time on or prior to the morning of the last day for lodging applications under the [REDACTED]. In such a case, notices of the reduction in the number of [REDACTED] and/or the indicative [REDACTED] will be available on the websites of the Stock Exchange at www.hkexnews.hk and our Company at www.cc-pg.cn not later than the morning of the day which is the last day for lodging applications under the [REDACTED]. For further information, see “Structure of the [REDACTED]” and “How to Apply for [REDACTED]”. We are incorporated, and substantially all of our businesses are located, in the PRC. Potential investors should be aware of the differences in the legal, economic and financial systems between the mainland of the PRC and Hong Kong and that there are different risk factors relating to investment in PRC-incorporated businesses. Potential investors should also be aware that the regulatory framework in the PRC is different from the regulatory framework in Hong Kong and should take into consideration the different market nature of our H Shares. See “Risk Factors”, “Regulatory Overview”, “Appendix V—Summary of Principal PRC and Hong Kong Legal and Regulatory Provisions” and “Appendix VI—Summary of Articles of Association”. The obligations of the [REDACTED] under the [REDACTED] are subject to termination by the [REDACTED] (for themselves and on behalf of the [REDACTED]) if certain grounds arise prior to 8:00 a.m. on the [REDACTED]. Such grounds are set forth in the section headed “[REDACTED] Arrangements and Expenses—[REDACTED]—Grounds for termination”. The [REDACTED] will become unconditional in all respects at 8:00 a.m. on the [REDACTED] if not terminated. The [REDACTED] have not been, and will not be, registered under the U.S. Securities Act or the securities laws of any state of the United States and may not be offered, sold, pledged or transferred within the United States, except that the [REDACTED] may be offered, sold or in offshore transactions outside the United States in reliance on Regulation S under the U.S. Securities Act.

[REDACTED]

* For identification purposes only

[REDACTED] THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. IMPORTANT

[REDACTED]

–2– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. IMPORTANT

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–i– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. EXPECTED TIMETABLE(1)

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–ii– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. EXPECTED TIMETABLE(1)

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– iii – THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. CONTENTS

IMPORTANT NOTICE TO INVESTORS

This document is issued by our Company solely for the [REDACTED] and the [REDACTED] and does not constitute an offer to sell or a solicitation of an offer to buy any securities other than the [REDACTED]. This document may not be used for the purpose of, and does not constitute, an offer to sell or a solicitation of an offer to buy in any other jurisdiction or in any other circumstances. No action has been taken to permit a [REDACTED] of the [REDACTED] or the distribution of this document in any jurisdiction outside Hong Kong. The distribution of this document and the [REDACTED] and sale of the [REDACTED] in other jurisdictions are subject to restrictions and may not be made except as permitted under the applicable securities laws of such jurisdictions pursuant to registration with or authorisation by the relevant securities regulatory authorities or an exemption therefrom.

You should rely only on the information contained in this document to make your investment decision. We have not authorized anyone to provide you with information that is different from the information contained in this document. Any information or representation not included in this document must not be relied on by you as having been authorized by us, the Joint Sponsors, the [REDACTED], the [REDACTED], the [REDACTED], the [REDACTED], any of our or their respective directors, officers, employees, agents, affiliates or advisors or any other party involved in the [REDACTED].

Expected Timetable ...... i

Contents ...... iv

Summary ...... 1

Definitions ...... 14

Glossary of Technical Terms ...... 25

Forward-Looking Statements ...... 28

Risk Factors ...... 30

Waivers from Strict Compliance with the Requirements under the Listing Rules ...... 65

Information about this Document and the [REDACTED] ...... 68

Directors, Supervisors and Parties Involved in the [REDACTED] ...... 75

Corporate Information ...... 80

Industry Overview ...... 82

–iv– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. CONTENTS

Regulatory Overview ...... 92

History, Reorganization and Corporate Structure ...... 108

Business ...... 123

Relationship with Controlling Shareholders ...... 200

Connected Transactions ...... 207

Substantial Shareholders ...... 209

Directors, Supervisors and Senior Management ...... 212

Share Capital ...... 233

Financial Information ...... 239

Future Plans and Use of Proceeds ...... 308

[REDACTED] ...... 315

Structure of the [REDACTED] ...... 330

How to Apply for [REDACTED] ...... 341

Appendix I — Accountant’s Report ...... I-1

Appendix II — Unaudited Pro Forma Financial Information ...... II-1

Appendix III — Property Valuation Report ...... III-1

Appendix IV — Taxation and Foreign Exchange ...... IV-1

Appendix V — Summary of Principal PRC and Hong Kong Legal and Regulatory Provisions ...... V-1

Appendix VI — Summary of the Articles of Association ...... VI-1

Appendix VII — Statutory and General Information ...... VII-1

Appendix VIII — Documents Delivered to the Registrar of Companies and Available for Inspection ...... VIII-1

–v– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. SUMMARY

This summary aims to give you an overview of the information contained in this document. Since it is a summary, it does not contain all the information that may be important to you. You should read this document in its entirety before you decide to invest in the [REDACTED].

There are risks associated with any investment. Some of the particular risks in investing in the [REDACTED] are set out in “Risk Factors” in this document. You should read that section carefully before you decide to invest in the [REDACTED].

OVERVIEW

We are the largest independent comprehensive property management service provider in China, with an operating history of more than 28 years and extensive experience in managing world-class projects. According to CIA, we are the only independent property management company among the Top 10 Property Management Companies in China in 2021, as well as ranking the first among all independent property management companies in China in terms of GFA under management, contracted GFA and revenue as of or for the year ended December 31, 2020. As of March 31, 2021, we had 708 projects under management and 855 projects contracted for management, with a total GFA under management of 114.6 million sq.m. and a total contracted GFA of 152.8 million sq.m., serving approximately three million property owners and residents. We also had 130 projects with a total GFA under management by our joint ventures of 59.3 million sq.m. as of March 31, 2021.

We provide basic property management services, as well as a variety of value-added services to property developers, property owners and residents, including sales office management services, space management services, community shopping services, home-living services, and car parks management services. We also provide professional services including construction and installation engineering services, elevator related services, and smart integrated operation platform services to property developers, property owners, property management companies, government agencies, transportation hubs and other companies.

We do not rely on any affiliated property developer and therefore, market competitiveness has been the key driver of our success since our inception. As we have to compete for projects on the open market, we strive to develop keen insights for market trends and customers needs to provide services that are above the expectation of our customer. Our ability to succeed under market competition is testified by our proven track record in obtaining management projects from property developers and owners who are independent from us, and our dedication to customer services and continuing self-improvement has been reflected in our market recognition and customer loyalty.

We have established a nationwide service network. Established in Shenzhen in 1993, we have been strategically expanding across China since 1999 when we first expanded our business to Beijing and became one of the first-movers in nationwide expansion among property management service providers in China. As of March 31, 2021, our project portfolio encompassed projects located in 162 cities across 31 provinces, municipalities and autonomous regions in China, with 62.4% of our GFA under management located in tier-one or new tier-one cities. Among the properties under our management, many are the landmarks in their respective cities, such as Shanghai Hongqiao World Center (上海虹橋世界中心), Ningbo Greenland Center (寧波綠地中心), Xi’an Greenland Center (西安綠地中心), Urumqi Greenland Center (烏魯木齊綠地中心), Suzhou Fanhua Center (蘇州繁花中心), Jinan Causeway Bay Plaza (濟南銅鑼灣廣場), Taiyuan Bingfen Shidai Plaza (太原繽紛時代廣場), Tianjin Jinzuo Plaza (天津金座廣場), Nanchang Zifeng Building (南昌紫峰大廈) and Wuxi Dongling Xishang Shopping Center (無錫東嶺錫上購物中心).

–1– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. SUMMARY

In addition to wide geographical presence, our project portfolio comprises a diverse range of property types, including residential properties, commercial complexes, office buildings, transportation hubs, schools, hospitals, and other public facilities such as exhibition centers and city parks. As of December 31, 2018, 2019 and 2020 and March 31, 2021, our GFA under management for non-residential properties amounted to 19.8 million sq.m., 23.6 million sq.m., 25.8 million sq.m. and 29.7 million sq.m., respectively, and our contracted GFA for non-residential properties amounted to 23.8 million sq.m., 37.6 million sq.m., 41.3 million sq.m. and 42.2 million sq.m., respectively. In particular, we manage a number of world-class venues or properties, such as the Olympic Village for the 2008 Beijing Olympics, the Chongli venues of the 2022 Beijing Winter Olympics, the venue for China International Import Expo, Tianjin Meijiang Convention and Exhibition Center (the venue for Summer Davos), National Convention and Exhibition Center (Tianjin) and the Window of Shaanxi International Sports (陝西國際體育之窗) (the command and media center for the 2021 National Games of China).

We are widely recognized in the industry and have received numerous awards and accolades. We have been ranked one of the top ten among the Top 100 Property Management Companies in terms of overall strength by CIA for 13 years. We were ranked first by CIA among the 2021 Leading Property Management Companies in China in terms of level of independent operation (市場化運營水平). According to CIA, our brand value exceeded RMB7.0 billion, and our brand was one of the Top 50 most valuable brands among property management service enterprises in China. Our brand was also recognized as a Shenzhen Top Brand (深圳知名品牌) by the Shenzhen Top Brand Evaluation Committee (深圳知名品牌評價委員會). We were the only property management company that has been recognized as the 2020 Shenzhen Top 100 Industry Leaders (深圳行業領袖企業100強) by the Shenzhen Industry Leader Corporate Development Promotion Association (深圳市行業領袖企業發展促進會) and Shenzhen Economic Daily (深圳商報).

Our quality services generated robust results of operations during the Track Record Period. In 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, our revenue was RMB2,404.3 million, RMB2,810.3 million, RMB3,035.6 million, RMB693.2 million and RMB783.8 million, respectively.

OUR BUSINESS MODEL

During the Track Record Period, we generated revenue primarily from four business lines: (i) property management services, (ii) value-added services to property developers, (iii) community value-added services, and (iv) professional services.

• Property management services. We provide property owners, residents and tenants and property developers with a wide range of property management services, which primarily comprise cleaning, security, greening and landscaping and repair and maintenance services. Our portfolio of managed properties comprises residential properties and non-residential properties, which primarily include commercial and public properties.

• Value-added services to property developers. Our value-added services to property developers primarily consist of sales office management services.

• Community value-added services. We provide a wide range of community value-added services to property owners, residents, tenants and property developers. Our community value-added services primarily consist of (i) space management services; (ii) community shopping services; (iii) home-living services; and (iv) car parks management services. We provide these services through our daily in-person interactions with property owners and residents and through our “EINYUN Life” (一應生活) mobile application and WeChat mini program.

• Professional services. We provide professional services to property developers, property owners, property management companies, government agencies, transportation hubs and other companies with elevator related businesses. Our professional services include (i) construction and installation engineering services; (ii) elevator related services; and (iii) smart integrated operation platform services.

The table below sets forth the revenue contribution by business line for the years or periods indicated:

For the year ended December 31, For the three months ended March 31, 2018 2019 2020 2020 2021 RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 % (Unaudited)

Property management services 1,905,789 79.3 2,196,176 78.1 2,315,359 76.3 538,546 77.7 608,096 77.6 Residential 1,243,412 51.7 1,456,606 51.8 1,502,706 49.5 364,398 52.6 395,532 50.5 Non-residential 662,377 27.6 739,570 26.3 812,653 26.8 174,148 25.1 212,564 27.1 Value-added services to property developers 152,536 6.3 123,173 4.5 108,473 3.6 27,260 3.9 28,014 3.6 Community value-added services 236,151 9.8 321,237 11.4 368,304 12.1 89,392 12.9 107,536 13.7 Professional services 109,811 4.6 169,763 6.0 243,464 8.0 37,964 5.5 40,152 5.1

Total 2,404,287 100.0 2,810,349 100.0 3,035,600 100.0 693,162 100.0 783,798 100.0

Revenue from our property management services increased during the Track Record Period, primarily driven by the increase in our total GFA under management as a result of our business expansion through organic growth as well as acquisition. During the Track Record Period, we experienced a steady growth in our GFA under management, which was 84.4 million sq.m., 101.4 million sq.m., 109.4 million sq.m. and 114.6 million sq.m. as of December 31, 2018, 2019 and 2020 and March 31, 2021, respectively.

The following table sets forth our gross profit and gross profit margin by business line for the years or periods indicated:

For the year ended December 31, For the three months ended March 31, 2018 2019 2020 2020 2021 Gross Gross Gross Gross Gross Gross profit Gross profit Gross profit Gross profit Gross profit profit margin profit margin profit margin profit margin profit margin RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 % (Unaudited)

Property management services 311,417 16.3 368,989 16.8 440,022 19.0 87,691 16.3 110,029 18.1 Value-added services to property developers 25,640 16.8 17,384 14.1 15,670 14.4 4,662 17.1 3,048 10.9 Community value-added services 51,975 22.0 84,242 26.2 111,098 30.2 31,474 35.2 39,084 36.3 Professional services 19,114 17.4 44,088 26.0 71,440 29.3 13,254 34.9 13,085 32.6

Total 408,146 17.0 514,703 18.3 638,230 21.0 137,081 19.8 165,246 21.1

Our overall gross profit margin in 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, was 17.0%, 18.3%, 21.0%, 19.8% and 21.1%, respectively. Our overall gross profit margins are affected by the gross profit margin for each of our business lines as well as fluctuations in our business mix. Our gross profit margin experienced an upward trend during the Track Record Period, primarily reflecting the increase of community value-added services and professional services, which had higher gross profit margin than property management services and value-added services to property developers, as a percentage of our overall revenue, and economies of scale as a result of our expansion.

–3– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. SUMMARY

Gross profit margin for our community value-added services was 22.0%, 26.2%, 30.2%, 35.2% and 36.3%, respectively, for 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021. Our gross profit margin for community value-added services generally increased during the Track Record Period primarily due to (i) the increase of space management services, community shopping services and home-living services, which in general had high gross profit margin, as a percentage of our overall revenue; and (ii) economies of scale due to the expansion of our car parks management services.

The following table sets forth our gross profit and gross profit margin from property management services by property type for the years or periods indicated:

Residential properties 201,981 16.2 248,779 17.1 287,110 19.1 75,424 20.7 67,981 17.2 Non-residential properties 109,436 16.5 120,210 16.3 152,912 18.8 12,267 7.0 42,048 19.8 Commercial properties 108,433 18.5 116,605 18.4 141,025 20.5 11,935 8.4 35,604 20.1 Public properties 1,003 1.3 3,605 3.4 11,887 9.4 332 1.0 6,444 18.0

Total gross profit/overall gross profit margin 311,417 16.3 368,989 16.8 440,022 19.0 87,691 16.3 110,029 18.1

The table below sets forth the average monthly property management fees charged for projects under our management during the Track Record Period by property type:

For the three months For the year ended December 31, ended March 31, 2018 2019 2020 2020 2021 RMB per sq.m. per month

Residential properties 1.6 1.6 1.5 1.5 1.6 Non-residential properties 2.8 2.6 2.6 2.5 2.4 Commercial properties 3.1 3.5 3.0 2.9 2.9 Public properties 1.6 1.0 1.6 1.6 1.3

Overall 1.9 1.8 1.8 1.7 1.8

In 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, our average property management fee was approximately RMB1.9 per sq.m. per month, RMB1.8 per sq.m. per month, RMB1.8 per sq.m. per month, RMB1.7 per sq.m. per month and RMB1.8 per sq.m. per month, respectively. The property management fees we charged during the Track Record Period were determined in accordance with local regulations and normal commercial terms. For an analysis on our average property management fee and its impact on our gross profit margin during the Track Record Period, please refer to “Financial Information—Description of Certain Consolidated Statements of Comprehensive Income—Gross Profit and Gross Profit Margin—Property Management Services.”

–4– The table below sets forth a breakdown of our total GFA under management and number of projects under management as of the THE THAT AND CHANGE THE TO ON “WARNING” SUBJECT HEADED SECTION AND THE INCOMPLETE WITH DOCUMENT. CONJUNCTION FORM, THIS IN OF DRAFT COVER READ BE IN MUST IS INFORMATION DOCUMENT THIS dates indicated, and revenue from property management services for the years or periods indicated, by type of property:

As of or for the year ended December 31, As of or for the three months ended March 31, 2018 2019 2020 2020 2021 Number of Number of Number of Number of Number of projects projects projects projects projects GFA under under GFA under under GFA under under GFA under under GFA under under management management Revenue management management Revenue management management Revenue management management Revenue management management Revenue sq.m.’000 Number RMB’000 % sq.m.’000 Number RMB’000 % sq.m.’000 Number RMB’000 % sq.m.’000 Number RMB’000 % sq.m.’000 Number RMB’000 % (Unaudited)

Residential properties 64,648 346 1,243,412 65.3 77,813 429 1,456,606 66.3 83,631 463 1,502,706 64.9 80,207 441 364,398 67.7 84,937 471 395,532 65.0

Non-residential properties 19,794 186 662,377 34.7 23,556 198 739,570 33.7 25,798 218 812,653 35.1 23,322 195 174,148 32.3 29,669 237 212,564 35.0

Commercial properties 15,872 153 587,251 30.8 14,989 146 634,482 28.9 19,324 175 686,572 29.7 16,497 148 141,681 26.3 20,400 191 176,741 29.1

Public properties 3,922 33 75,126 3.9 8,567 52 105,088 4.8 6,473 43 126,081 5.4 6,825 47 32,467 6.0 9,269 46 35,823 5.9

Total 84,442 532 1,905,789 100.0 101,369 627 2,196,176 100.0 109,429 681 2,315,359 100.0 103,529 636 538,546 100.0 114,606 708 608,096 100.0 SUMMARY –5–

During the Track Record Period, we generated a majority of our revenue from managing residential properties. Our total GFA under management for residential properties grew from approximately 64.6 million sq.m. as of December 31, 2018 to approximately 84.9 million sq.m. as of March 31, 2021.

We remained focused on property management for residential properties, while we also sought to diversify our portfolio of managed properties to include a wide range of non-residential properties. We have been contracted to manage commercial complexes, office buildings, transportation hubs, schools, hospitals, and other public facilities. The proportion of our revenue generated from non-residential projects to our total revenue generated from managing properties decreased from 34.7% in 2018 to 33.7% in 2019 and increased to 35.1% in 2020. In addition, the proportion of our revenue generated from non-residential projects to our total revenue generated from managing properties increased from 32.3% for the three months ended March 31, 2020 to 35.0% for the three months ended March 31, 2021. We believe that as we accumulate experience and recognition for the quality of our property management services to both residential and non-residential properties, we will be able to continue to diversify our portfolio of properties under management and further enlarge our customer base. The following table sets forth a breakdown of our total GFA under management by fee model as of the dates indicated and revenue THE THAT AND CHANGE THE TO ON “WARNING” SUBJECT HEADED SECTION AND THE INCOMPLETE WITH DOCUMENT. CONJUNCTION FORM, THIS IN OF DRAFT COVER READ BE IN MUST IS INFORMATION DOCUMENT THIS generated from property management services by fee model for the years or periods indicated:

As of or for the year ended December 31, As of or for the three months ended March 31, 2018 2019 2020 2020 2021 GFA Revenue GFA Revenue GFA Revenue GFA Revenue GFA Revenue sq.m. RMB % sq.m. RMB % sq.m. RMB % sq.m. RMB % sq.m. RMB % (in thousands, except for percentages) (Unaudited)

Lump sum basis 73,395 1,882,852 98.8 89,698 2,169,621 98.8 97,836 2,290,244 98.9 91,844 533,281 99.0 103,298 602,826 99.1 Commission basis 11,047 22,937 1.2 11,671 26,555 1.2 11,593 25,115 1.1 11,685 5,265 1.0 11,308 5,270 0.9

Total 84,442 1,905,789 100.0 101,369 2,196,176 100.0 109,429 2,315,359 100.0 103,529 538,546 100.0 114,606 608,096 100.0 SUMMARY The table below sets forth a breakdown of our total GFA under management as of the dates indicated, and total revenue generated –6– from property management services as well as their respective percentage of our total revenue generated from property management services for the periods indicated, by geographic region:

As of or for the year ended December 31, As of or for the three months ended March 31, 2018 2019 2020 2020 2021 GFA under GFA under GFA under GFA under GFA under management Revenue management Revenue management Revenue management Revenue management Revenue sq.m.’000 RMB’000 % sq.m.’000 RMB’000 % sq.m. ’000 RMB’000 % sq.m. ’000 RMB’000 % sq.m. ’000 RMB’000 % (Unaudited)

South China Region

(1) 17,747 191,962 10.0 19,604 246,716 11.3 21,250 279,170 12.0 19,976 74,055 13.8 24,356 93,721 15.4 North China Region (2) 17,577 521,565 27.4 19,434 566,289 25.8 19,464 575,774 24.9 19,186 131,638 24.4 19,159 143,436 23.6 East China Region (3) 15,839 361,269 19.0 22,161 444,140 20.2 22,165 504,261 21.8 21,664 111,116 20.6 21,649 126,468 20.8 Central China Region (4) 13,538 334,317 17.5 16,611 392,953 17.9 18,939 394,935 17.1 17,065 88,263 16.4 20,643 96,436 15.9 West China Region (5) 10,375 249,110 13.1 14,295 303,782 13.8 17,262 311,250 13.4 16,842 76,275 14.2 17,564 82,867 13.6 Bohai Region (6) 9,366 247,566 13.0 9,264 242,296 11.0 10,349 249,969 10.8 8,796 57,199 10.6 11,235 65,168 10.7

Total 84,442 1,905,789 100.0 101,369 2,196,176 100.0 109,429 2,315,359 100.0 103,529 538,546 100.0 114,606 608,096 100.0 THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. SUMMARY

Notes:

(1) Includes Guangdong Province, Guangxi Zhuang Autonomous Region, Fujian Province, Hunan Province, Hainan Province and Guizhou Province.

(2) Includes Beijing, Hebei Province and Ningxia Hui Autonomous Region.

(3) Includes Shanghai, Shandong Province, Anhui Province, Jiangsu Province and Zhejiang Province.

(4) Includes Hubei Province, Jiangxi Pronvince, Henan Province, Shanxi Province and Shaanxi Province.

(5) Includes Chongqing, Sichuan Province, Yunnan Province, Qinghai Province, Gansu Province, Inner Mongolia Autonomous Region, Xinjiang Uygur Autonomous Region and Tibet Autonomous Region.

(6) Includes Tianjin, Liaoning Province, Jilin Province and Heilongjiang Province.

OUR COMPETITIVE STRENGTHS

We believe that the following strengths contribute to our leading market position, ensure our success and distinguish us from our competitors: (i) the largest independent comprehensive property management service provider in China; (ii) strong expansion capabilities through effective marketing and multi-dimensional business development model; (iii) outstanding operational capabilities underpinned by deep connection with customers and effective management systems; (iv) high service quality and operational efficiency through implementation of technological solutions; (v) innovative property management industry alliance to foster the growth of a community property management ecosystem; and (vi) seasoned, visionary and stable management team supported by effective human resources and incentive systems. See “Business—Competitive Strengths” for more details.

OUR BUSINESS STRATEGIES

We intend to consolidate our market position and achieve further expansion by pursuing the following strategies: (i) reinforce our leadership position in property management business through expanding business scale; (ii) improve service quality and customer satisfaction through community activities and adoption of technological solutions; (iii) diversify our service offerings to meet customer needs; (iv) further develop technological and alliance platforms to empower our business and diversify our revenue sources; and (v) further optimize our human resource system to support our long term growth. See “Business—Business Strategies” for more details.

OUR CUSTOMERS AND SUPPLIERS

Our customer base primarily consists of property developers, property owners, residents, tenants, state-owned enterprises and government agencies. In 2018, 2019 and 2020 and the three months ended March 31, 2021, revenue from our five largest customers, which were all independent third-parties, amounted to RMB216.3 million, RMB183.4 million, RMB159.4 million and RMB31.9 million, respectively, accounting for 9.0%, 6.6%, 5.2% and 4.1% of our total revenue for the same periods, respectively. During the Track Record Period, we provided to our largest customer property management services. In 2018, 2019 and 2020 and the three months ended March 31, 2021, revenue generated from our services provided to our largest customer of the particular year amounted to RMB154.5 million, RMB141.4 million, RMB88.3 million and RMB10.3 million, respectively, accounting for 6.4%, 5.0%, 2.9% and 1.3% of our total revenue, respectively.

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Our suppliers are primarily suppliers and subcontractors located in China. All of our five largest suppliers during the Track Record Period were Independent Third Parties. In 2018, 2019 and 2020 and the three months ended March 31, 2021, purchases from our five largest suppliers amounted to RMB127.5 million, RMB164.3 million, RMB175.2 million and RMB42.7 million, respectively, accounting for 9.2%, 10.5%, 10.8% and 10.9% of our total purchases for the same periods, respectively.

Please see “Business—Customers” and “Business—Suppliers” for details.

CONTROLLING SHAREHOLDERS AND CONNECTED TRANSACTIONS

Immediately upon completion of the [REDACTED] without taking into account any Shares which may be issued pursuant to the exercise of the [REDACTED], our Ultimate Controlling Shareholders, namely Mr. Chen Yaozhong, Mr. Liang Zhijun, Mr. Lv Yuhua and Mr. Ma Xingwen, by virtue of the Acting in Concert Arrangement, will control in total approximately [REDACTED]% of the total share capital of our Company through the limited partnerships where they act as the general partners. Accordingly, Mr. Chen Yaozhong, Mr. Liang Zhijun, Mr. Lv Yuhua and Mr. Ma Xingwen, together with the Employee Stock Ownership Platforms controlled by them, will be a group of Controlling Shareholders upon the [REDACTED].

We have entered into a number of agreements with our connected persons which will constitute continuing connected transactions under Chapter 14A of the Listing Rules upon the [REDACTED]. See “Connected Transactions” for more details.

SUMMARY KEY FINANCIAL INFORMATION

The summary historical data of financial information set forth below have been derived from, and should be read in conjunction with, our consolidated audited financial statements, including the accompanying notes, set forth in the Accountant’s Report attached as Appendix I to this document, as well as the information set forth in “Financial Information”. Our financial information was prepared in accordance with HKFRS.

Summary of Consolidated Statements of Comprehensive Income

For the year ended For the three months December 31, ended March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Revenue 2,404,287 2,810,349 3,035,600 693,162 783,798 Cost of services (1,996,141) (2,295,646) (2,397,370) (556,081) (618,552)

Gross profit 408,146 514,703 638,230 137,081 165,246 Operating profit 122,816 176,067 284,871 63,224 79,695 Profit before income tax 110,409 185,721 287,350 66,295 76,826

Profit for the year/period 71,372 134,162 206,566 47,092 49,971

Profit attributable to: − Owners of the Company 69,245 135,344 210,012 49,920 53,268 − Non-controlling interests 2,127 (1,182) (3,446) (2,828) (3,297)

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Our revenue increased from RMB2,404.3 million in 2018 to RMB2,810.3 million in 2019 and further to RMB3,035.6 million in 2020. Our revenue increased from RMB693.2 million for the three months ended March 31, 2020 to RMB783.8 million for the same period in 2021. Our gross profit increased from RMB408.1 million in 2018 to RMB514.7 million in 2019 and further to RMB638.2 million in 2020. Our gross profit increased from RMB137.1 million for the three months ended March 31, 2020 to RMB165.2 million for the same period in 2021. The increases in our revenue and gross profit during the Track Record Period were primarily driven by our business expansion.

Summary of Consolidated Balance Sheets

For the three months ended For the year ended December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Non-current assets 566,536 628,709 656,883 649,129 Current assets 1,534,057 1,607,507 1,781,090 1,871,542 Current liabilities 2,054,565 2,126,305 1,631,385 1,782,814 Net current assets/(liabilities) (520,508) (518,798) 149,705 88,728 Non-current liabilities 116,514 93,356 74,642 65,196 Non-controlling interests 10,167 11,692 9,605 6,308 Total equity (70,486) 16,555 731,946 672,661

Our net current assets decreased by RMB61.0 million from RMB149.7 million as of as of December 31, 2020 to RMB88.7 million as of March 31, 2021, mainly attributable to (i) an increase in trade and other payables and (ii) a decrease in cash and cash equivalents; partially offset by (i) an increase in trade and other receivables and (ii) an increase in financial assets at fair value through profit or loss. Our net current assets increased by RMB668.5 million from net current liabilities of RMB518.8 million as of as of December 31, 2019 to net current assets of RMB149.7 million as of December 31, 2020, mainly attributable to (i) the expiration of the redemption option of the redeemable shares, (ii) an increase in financial assets at fair value through profit or loss, (iii) an increase in prepayments, and (iv) an increase in trade and other receivables, partially offset by an increase in borrowings. Our net current liabilities decreased by RMB1.7 million from RMB520.5 million as of as of December 31, 2018 to RMB518.8 million as of December 31, 2019, mainly attributable to (i) a decrease in financial assets at fair value through profit or loss, (ii) a decrease in prepayments, and (iii) a decrease in payments on behalf of residents, partially offset by an increase in assets held for sale. For more details, please refer to “Financial Information—Current Assets and Current Liabilities.”

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Summary of Consolidated Statements of Cash Flows

As of December 31, As of March 31, 2018 2019 2020 2020 2021 RMB’000 (Unaudited)

Operating cashflow before changes in working capital 197,990 288,782 362,370 88,303 103,206 Net cash inflow/(outflow) from operating activities 53,791 139,869 183,040 70,794 (127,605) Net cash outflow from investing activities (75,220) (38,479) (96,200) 65,683 (8,587) Net cash outflow from financing activities (96,810) (107,956) (96,360) (12,642) (11,658)

Net decrease in cash and cash equivalents (118,239) (6,566) (9,520) (149,119) (147,850) Cash and cash equivalents as of the beginning of year/period 648,538 530,299 523,733 523,733 514,213

Cash and cash equivalents as of the end of year/period 530,299 523,733 514,213 374,614 366,363

Our net cash from operating activities increased from RMB53.8 million in 2018 to RMB139.9 million in 2019 and further to RMB183.0 million, primarily due to the increase of cash generated from operations. See “Financial Information—Liquidity and Capital Resources—Cash Flow—Net Cash from Operating Activities.”

Summary of Key Financial Ratios

As of or for the three As of or for the year ended months ended December 31, March 31, 2018 2019 2020 2021

Return on equity (%) 14.3 23.2 28.2 30.1 Return on total assets (%) 3.4 6.0 8.5 8.0 Current ratios (times) 1.0 1.0 1.1 1.0 Gearing ratios (%) 52.5 41.1 31.8 33.4

See “Financial Information—Key Financial Ratios” for more details.

[REDACTED] STATISTICS

The statistics in the following table are based on the assumptions that: (i) the [REDACTED] is completed and [REDACTED] Shares are issued and sold in the [REDACTED]; (ii) the [REDACTED] is not exercised; and (iii) [REDACTED] Shares are issued and outstanding upon completion of the [REDACTED] and conversion of Domestic shares into H shares.

Based on an Based on an [REDACTED] of [REDACTED] of HK$[REDACTED] HK$[REDACTED] per [REDACTED] per [REDACTED]

Market capitalization of our Shares HK$[REDACTED] HK$[REDACTED] Unaudited pro forma adjusted consolidated net tangible assets per Share(1) HK$[REDACTED] HK$[REDACTED]

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Note:

(1) The unaudited pro forma adjusted consolidated net tangible assets per Share as at March 31, 2021 is calculated after making the adjustments referred to in “Appendix II—Unaudited Pro Forma Financial Information”. No adjustment has been made to reflect any trading result or other transactions of the Group entered into subsequent to March 31, 2021, including 5,668,834 shares issued to Xicheng Rui’an with a total cash consideration of approximately RMB44,104,000 and a dividend of approximately RMB102,745,000 declared by the Company in April 2021. Had this issuance of shares to Xicheng Rui’an and the payment of such dividend been taken into account, the unaudited pro forma adjusted consolidated net tangible assets attributable to owners of the Company would have decreased from HK$[REDACTED] per H Share to HK$[REDACTED] per H Share, and HK$[REDACTED] per H Share to HK$[REDACTED] per H Share, based on the indicative [REDACTED] of HK$[REDACTED] per H Share and HK$[REDACTED] per H share respectively.

DIVIDENDS AND DIVIDEND POLICY

In 2018, 2019 and 2020 and the three months ended March 31, 2021, we distributed dividends in the aggregate amount of RMB111.7 million, RMB46.7 million, RMB52.4 million and nil. In April 2021, we announced dividend in the amount of RMB102.7 million to be paid to our existing shareholders. As of the Latest Practicable Date, we had distributed such dividends in the amount of RMB65.9 million and expect to distribute the remaining RMB36.8 million by the end of July 2021. As of the Latest Practicable Date, except otherwise disclosed, we had not proposed payment of dividend for the months up to the [REDACTED] in the year ending December 31, 2021, nor formulated any plans as to whether such dividends would be paid to the pre-[REDACTED] shareholders.

The payment and the amount of any future dividends, if any, will be at the sole discretion of our Board of Directors and will also depend on various factors that our Board of Directors deem relevant. Any declaration and payment as well as the amount of dividends will be subject to our constitutional documents and the relevant laws. Our Board of Directors intends to recommend at the relevant shareholder meetings an annual dividend of no less than 30.0% of our profits available for distribution generated in each financial year beginning from the year ending December 31, 2021.

USE OF PROCEEDS

We estimate that we will receive net proceeds of approximately HK$ [REDACTED] from the [REDACTED], after deducting the [REDACTED] and other estimated expenses payable by us in connection with the [REDACTED], assuming that the [REDACTED] is not exercised and assuming an [REDACTED] of HK$[REDACTED] per H Share (being the mid-point of the indicative [REDACTED] set forth on the cover page of this document). We intend to use such net proceeds from the [REDACTED] for the purposes and in the amounts set forth below:

• approximately [REDACTED]%, or approximately HK$[REDACTED], will be used to further enhance our research and development capability and further develop and upgrade our digitalization platforms;

• approximately [REDACTED]%, or approximately HK$[REDACTED], will be used to improve our organizational skill and operational efficiency;

• approximately [REDACTED]%, or approximately HK$[REDACTED], will be used to enhance our sales and marketing capabilities; and

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• approximately [REDACTED]%, or approximately HK$[REDACTED], will be used for general business operations and working capital.

For more information, see “Future Plans and Use of Proceeds.”

RECENT DEVELOPMENTS AND NO MATERIAL ADVERSE CHANGE

Country Garden Services entered into a share transfer agreement with Shengmei Tongying, pursuant to which Country Garden Services agreed to acquire shares in our Company from Shengmei Tongying. See “History, Reorganization and Corporate Structure—Pre-[REDACTED] Investment” for details.

Since March 31, 2021 and up to the Latest Practicable Date, we had entered into 35 contracts to provide property management services with respect to 31 projects with aggregated contracted GFA of approximately 5.1 million sq.m.. During the same period, we had 26 projects newly delivered for our management with an aggregate GFA under management of approximately 2.4 million sq.m..

Since March 31, 2021 and up to the Latest Practicable Date, our business remained stable which was in line with the past trends and our expectations. To the best of our knowledge, since March 31, 2021 (being the date on which the latest audited combined financial information of our Group was prepared) and up to the date of this document, there is no change to the overall economic and market condition in China or in the PRC property management service market in which we operate that may have a material adverse effect on our business operations and financial position. Our Directors confirmed that, as of the date of this document, there has been no material adverse change in our financial or trading position, indebtedness, mortgage, contingent liabilities, guarantees or prospects as of March 31, 2021, the latest date of our financial statements.

Effects of the COVID-19 Outbreak

An outbreak of respiratory illness caused by a novel coronavirus, namely COVID-19, was reported in December 2019 and continues to expand globally. The outbreak of the COVID-19 pandemic is likely to have an adverse impact on the livelihood of people around the world and on the global economy. See “Business—Effects of the COVID-19 Outbreak.”

In response to the COVID-19 outbreak, we have implemented a contingency plan and adopted enhanced hygiene and precautionary measures across our managed properties, such as (i) measuring the body temperature of personnel entering properties under our management; (ii) regularly disinfecting and maintaining cleanliness of common areas of properties under our management; and (iii) assisting local government in supervising and providing delivery services to households under quarantine. In 2020, we incurred aggregate costs for implementing these enhanced measures of approximately RMB13.9 million. This mainly consists of the costs for purchasing medical or cleaning supplies such masks, disinfectants and infrared thermometers, as well as the staff cost to carry out these measures. Our Directors believe that the additional costs associated with the enhanced measures, after taking into account relevant regulatory policies such as deduction of social insurance contributions and subsidies from local governments, would have no significant impact on our Group’s financial position or results of operations in 2021.

According to CIA, the China’s real estate market has gradually recovered since April 2020, which is in line with the recovery of the national economy. According to CIA, the total GFA under management by property management service companies is expected to increase by 8.2% to 25.9 billion sq.m. as of December 31, 2020 as compared to December 31, 2019. On the basis of the above, it is expected that COVID-19 would not materially and adversely affect the property management industry in China.

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Despite the outbreak of COVID-19, we achieved steady growth in terms of business scale and financial performance. Our GFA under management increased by 7.9% from 101.4 million sq.m. as of December 31, 2019 to 109.4 million sq.m. as of December 31, 2020. Our contracted GFA increased by 14.8% from 133.4 million sq.m. as of December 31, 2019 to 153.1 million sq.m. as of December 31, 2020. Despite the increase in additional medical material costs, in 2020 our revenue increased steadily by 8.0% to RMB3,035.6 million from RMB2,810.3 million in 2019, primarily due to the continued increase in our GFA under management as a result of our business growth.

Currently, it is one of our business strategies to continue to expand our geographic presence and business. According to CIA, the outbreak of COVID-19 is expected to cause certain short-term economic slowdown across China but it will unlikely affect the regional macroeconomic development plan and talent recruitment plan in the long term in China, and it is expected that once the outbreak is effectively controlled, the outlook for demand of residential property management services in these cities will remain positive. We therefore believe that our expansion plan as discussed in “—Our Business Strategies” is feasible, and it is unlikely that we would change the use of the net proceeds from the [REDACTED] as disclosed in “Future Plans and Use of Proceeds” in this document as a result of the COVID-19 outbreak.

[REDACTED] EXPENSES

The total amount of [REDACTED] expenses that will be borne by us in connection with the [REDACTED], including [REDACTED], is estimated to be approximately HK$[REDACTED] (based on the mid-point of the indicative [REDACTED] before the exercise of the [REDACTED]), of which HK$[REDACTED] is expected to be accounted for as a deduction from equity upon completion of the [REDACTED]. The remaining fees and expenses include RMB[REDACTED] (HK$[REDACTED]) was charged to our profit or loss during the Track Record Period and HK$[REDACTED] are expected to be charged to our profit or loss subsequent to the end of the Track Record Period and upon completion of the [REDACTED]. The professional fees and/or other expenses related to the preparation of the [REDACTED] are currently in estimates for reference only and the actual amount to be recognized is subject to adjustment based on audit and the then changes in variables and assumptions. Our Directors do not expect that our [REDACTED] expenses will have a material adverse impact on our financial performance for the year ending December 31, 2021.

RISK FACTORS

Our operations involve certain risks, some of which are beyond our control. These risks can be broadly categorized into: (i) risks related to our business and industry; (ii) risks related to doing business in China; and (iii) risks related to the [REDACTED]. Some of the risks generally associated with our business and industry include (i) our future growth may not materialize as planned; (ii) we cannot assure you that we can secure new or renew our existing property management service agreements on favorable terms, or at all; (iii) our future acquisitions may not be successful and we may face difficulties in integrating acquired operations with our existing operation; (iv) we may face fluctuations in our labor and subcontracting costs, and the increase in labor and subcontracting costs could harm our business and reduce our profitability; and (v) we may fail to effectively anticipate or control our costs in providing our property management services, for which we generally charge our customers on a lump sum basis.

These risks are not the only significant risks that may affect the value of our Shares. You should carefully consider all of the information set forth in this document and, in particular, should evaluate the specific risks set forth in “Risk Factors” in deciding whether to invest in our Shares.

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In this document, unless the context otherwise requires, the following words and expressions shall have the meanings set out below. Certain technical terms are explained in the section headed “Glossary of technical terms” in this document.

“Acting in Concert the acting in concert arrangement under the acting in Arrangement” concert agreement dated March 15, 2021 and executed by our Ultimate Controlling Shareholders, details of which are set out in “Relationship with Controlling Shareholders—Acting in Concert Arrangement”

“Articles of Association” the articles of association of the Company adopted on May 10, 2021, which will become effective upon the [REDACTED], as amended, supplemented or otherwise modified from time to time, a summary of which is set out in Appendix VI to this document

“associate(s)” has the meaning ascribed to it under the Listing Rules

“Board” the Board of Directors

“business day” a day on which banks in Hong Kong are generally open for business to the public and which is not a Saturday, Sunday or public holiday in Hong Kong

“CCASS” the Central Clearing and Settlement System established and operated by HKSCC

“CCASS Clearing Participant” a person admitted to participate in CCASS as a direct clearing participant or general clearing participant

“CCASS Custodian Participant” a person admitted to participate in CCASS as a custodian participant

[REDACTED] [REDACTED]

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“CCASS Investor Participant” a person admitted to participate in CCASS as an investor participant who may be an individual or joint individuals or a corporation

“CCASS Operational the operational procedures of HKSCC in relation to Procedures” CCASS, containing the practices, procedures and administrative requirements relating to the operation and functions of CCASS as from time to time in force

“CCASS Participant” a CCASS Clearing Participant, a CCASS Custodian Participant or a CCASS Investor Participant

“Centralcon Capital” Shenzhen Centralcon Capital Co., Ltd.* (深圳市中洲資本有限公司) (formerly known as Shenzhen Changsheng Industrial Development Co., Ltd.* (深圳市長盛實業發展有限公司)), a company established in the PRC with limited liability on August 1, 1993 and owned as to 100% by Centralcon Holding, one of our substantial Shareholders

“Centralcon Holding” Shenzhen Centralcon Investment Holding Co., Ltd (深圳市中洲投資控股股份有限公司) (formerly known as Shenzhen Engineering Development Company* (深圳市工程開發公司), Shenzhen Great Wall Real Estate Development Co* (深圳市長城房地產發展公司), Shenzhen Great Wall Real Estate Co., Ltd* (深圳市長城地產股份有限公司), Shenzhen Great Wall Real Estate (Group) Co. Ltd* (深圳市長城地產（集團）股份有限公司), Shenzhen Great Wall Investment Holding Co. Ltd* (深圳市長城投資控股股份有限公司), a joint stock company with limited liability established in the PRC on September 17, 1984, and listed on the SZSE (stock code: 000042)

“Changcheng Elevator” Shenzhen Changcheng Elevator Engineering Co., Ltd.* (深圳市長城電梯工程有限公司), a company established in the PRC with limited liability on February 17, 1995 and a wholly-owned subsidiary of our Company

“Changcheng Louyu Shenzhen Changcheng Louyu Technology Co., Ltd.* (深 Technology” 圳市長城樓宇科技有限公司), a company established in the PRC with limited liability on May 18, 2004 and a wholly-owned subsidiary of our Company

“China” or “PRC” the People’s Republic of China, excluding, for the purpose of this document only, Hong Kong, Macau and Taiwan

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“CIA” China Index Academy, our industry consultant, and an Independent Third Party

“CIA Report” an independent market research report prepared by CIA, which was commissioned by our Company for the purpose of this document

“close associate(s)” has the meaning ascribed to it under the Listing Rules

“Companies Ordinance” the Companies Ordinance (Chapter 622 of the Laws of Hong Kong), as amended, supplemented or otherwise modified from time to time

“Companies (Winding Up and the Companies (Winding Up and Miscellaneous Miscellaneous Provisions) Provisions) Ordinance (Chapter 32 of the Laws of Ordinance” Hong Kong), as amended, supplemented or otherwise modified from time to time

“Company” Changcheng Property Group Co., Ltd.* (長城物業集團股份有限公司) (formerly known as Shenzhen Changcheng Property Management Company* (深圳市長城物業管理公司) and Shenzhen Changcheng Property Management Co., Ltd.* (深圳市長城物業管理股份有限公司)), established in the PRC on April 1, 1993, and subsequently formally registered as a limited liability company on December 30, 1996 and converted into a joint stock company with limited liability on June 5, 2003

“Controlling Shareholder(s)” has the meaning ascribed to it under the Listing Rules, and unless the context requires otherwise, refers to Mr. Chen Yaozhong (陳耀忠), Mr. Liang Zhijun (梁志軍), Mr. Lv Yuhua (呂雨華) and Mr. Ma Xingwen ( 馬興文) together with the Employee Stock Ownership Platforms controlled by them

“Conversion of Domestic Shares the conversion of [87,212,834] Domestic Shares in into H Shares” aggregate (representing all the Domestic Shares issued by the Company prior to the [REDACTED])on a one-for-one basis upon the completion of [REDACTED]

“Country Garden Services” Country Garden Life Services Holdings Group Co., Ltd.* (碧桂園生活服務集團股份有限公司), a joint stock company with limited liability established in the PRC on April 19, 2004, our Pre-[REDACTED] investor and one of our substantial Shareholders

“COVID-19” a viral respiratory disease caused by the severe acute respiratory syndrome coronavirus 2

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“CSDC” China Securities Depository and Clearing Corporation Limited

“CSDC (Hong Kong)” China Securities Depository and Clearing (Hong Kong) Company Limited

“CSRC” the China Securities Regulatory Commission (中國證券監督管理委員會), a regulatory body responsible for the supervision and regulation of the PRC national securities markets

“Deed of Non-Competition” the deed of non-competition dated [●] and executed by our Ultimate Controlling Shareholders in favor of our Company, details of which are set out in “Relationship with Controlling Shareholder—Deed of Non-competition” in this document

“Director(s)” the director(s) of our Company

“Domestic Share(s)” ordinary Share(s) in the share capital of the Company with a nominal value of RMB1.00 each, which are subscribed for and paid up in Renminbi

“Employee Stock Ownership Xicheng Ruijia, Xicheng Ruihe, Xicheng Ruifeng, Platforms” Xicheng Ruiying and Xicheng Rui’an, each as an “Employee Stock Ownership Platform”

“Extreme Condition(s)” extreme condition(s) including but not limited to serious disruption of public transport services, extensive flooding, major landslides and large-scale power outage caused by a super typhoon according to the revised “Code of Practice in Times of Typhoons and Rainstorms” issued by the Labour Department of the government of Hong Kong in June 2019, as announced by the government of Hong Kong

“Foshan Chengjiruishang” Foshan Shunde Chengjiruishang Commercial Operation Management Co., Ltd.* (佛山市順德區城基睿商商業運營管理有限公司), a company established in the PRC with limited liability on December 22, 2008 and a wholly-owned subsidiary of our Company

[REDACTED] [REDACTED]

–17– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. DEFINITIONS

“Group”, “we”, “our” or “us” our Company and our subsidiaries

“H Share(s)” the overseas [REDACTED] foreign share(s) in our ordinary share capital, with a nominal value of RMB1.00 each, to be subscribed for and to be traded in Hong Kong dollars and are to be [REDACTED] on the Stock Exchange

“H Share Registrar” [REDACTED]

“HKSCC” Hong Kong Securities Clearing Company Limited, a wholly-owned subsidiary of Hong Kong Exchanges and Clearing Limited

“HKSCC Nominees” HKSCC Nominees Limited, a wholly-owned subsidiary of HKSCC

“Hong Kong” the Hong Kong Special Administrative Region of the People’s Republic of China

“Hong Kong dollars” or “HK$” Hong Kong dollars, the lawful currency of Hong Kong

[REDACTED] [REDACTED]

–18– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. DEFINITIONS

[REDACTED] [REDACTED]

“Independent Third Party(ies)” an individual(s) or a company(ies) who or which is/are not connected with (within the meaning of the Listing Rules) any Directors, chief executive or substantial Shareholders of our Company or our subsidiaries, or any of their respective associates (within the meaning of the Listing Rules)

[REDACTED] [REDACTED]

“JLL” Jones Lang LaSalle Corporate Appraisal and Advisory Limited, our independent property valuer

[REDACTED] [REDACTED]

–19– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. DEFINITIONS

[REDACTED] [REDACTED]

“Joint Sponsors” Huatai Financial Holdings (Hong Kong) Limited and Ping An of China Capital (Hong Kong) Company Limited

“Latest Practicable Date” June 6, 2021, being the latest practicable date for the purpose of ascertaining certain information in this document prior to its publication

[REDACTED] [REDACTED]

“Listing Committee” the listing sub-committee of the board of directors of the Stock Exchange

[REDACTED] [REDACTED]

“Listing Rules” the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, as amended, supplemented or otherwise modified from time to time

“Mandatory Provisions” the Mandatory Provisions of the Articles of Association of Companies to be Listed Overseas (到境外上市公司章程必備條款), as promulgated by the Securities Commission of the State Council and the State Commission for Economic Restructuring on August 27, 1994 and becoming effective on the same date, as the same may be amended and supplemented or otherwise modified from time to time

[REDACTED] [REDACTED]

–20– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. DEFINITIONS

[REDACTED] [REDACTED]

“PBOC” the People’s Bank of China (中國人民銀行)

“PRC Company Law” Company Law of the PRC (中華人民共和國公司法)

“PRC Legal Advisor” Global Law Office, the legal advisor to our Company as to PRC laws

[REDACTED] [REDACTED]

“Regulation S” Regulation S under the U.S. Securities Act

“Renminbi” or “RMB” Renminbi yuan, the lawful currency of the PRC

“Reporting Accountant” PricewaterhouseCoopers, the reporting accountant of our Company

“SFC” the Securities and Futures Commission of Hong Kong

“Shareholder(s)” the holder(s) of the Shares

“Share(s)” ordinary share(s) in the share capital of our Company with a nominal value of RMB1.00 each

“Shenzhen Shenchangcheng” Shenzhen Shenchangcheng Property Group Co., Ltd.* (深圳市深長城物業集團有限公司), a company established in the PRC with limited liability on August 7, 2009 and a wholly-owned subsidiary of our Company

–21– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. DEFINITIONS

“Special Regulations” the Special Regulations of the State Council on the Overseas Offering and the Listing of Shares by Joint Stock Limited Companies (國務院關於股份有限公司境外募集股份及上市的特別規定), which was promulgated by the State Council on August 4, 1994, as amended, supplemented or otherwise modified from time to time

[REDACTED] [REDACTED]

“Stock Exchange” The Stock Exchange of Hong Kong Limited

“Supervisor(s)” the supervisor(s) of our Company

“SZSE” the Shenzhen Stock Exchange

“U.S. Securities Act” the U.S. Securities Act of 1933, as amended, supplemented or otherwise modified from time to time, and the rules and regulations promulgated thereunder

“Ultimate Controlling Mr. Chen Yaozhong (陳耀忠), Mr. Liang Zhijun (梁志 Shareholders” 軍), Mr. Lv Yuhua (呂雨華) and Mr. Ma Xingwen (馬興文)

[REDACTED] [REDACTED]

“United States” the United States of America, its territories and possessions, any State of the United States and the District of Columbia

“US dollars” United States dollars, the lawful currency of the United States

–22– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. DEFINITIONS

[REDACTED] [REDACTED]

“Xicheng Rui’an” Shenzhen Xicheng Rui’an Investment Consultation Partnership (Limited Partnership)* (深圳市熙城睿安投資咨詢合夥企業（有限合夥）), a limited liability partnership established in the PRC on April 20, 2021 with Mr. Chen Yaozhong as its general partner, one of our Controlling Shareholders

“Xicheng Ruifeng” Shenzhen Xicheng Ruifeng Investment Consultation Partnership (Limited Partnership)* (深圳市熙城睿豐投資諮詢合夥企業（有限合夥）), a limited liability partnership established in the PRC on February 2, 2016 with Mr. Liang Zhijun as its general partner, one of our Controlling Shareholders

“Xicheng Ruihe” Shenzhen Xicheng Ruihe Investment Consultation Partnership (Limited Partnership)* (深圳市熙城睿和投資諮詢合夥企業（有限合夥）), a limited liability partnership established in the PRC on February 2, 2016 with Mr. Chen Yaozhong as its general partner, one of our Controlling Shareholders

“Xicheng Ruijia” Shenzhen Xicheng Ruijia Investment Consultation Partnership (Limited Partnership)* (深圳市熙城睿家投資諮詢合夥企業（有限合夥）), a limited liability partnership established in the PRC on February 2, 2016 with Mr. Ma Xingwen as its general partner, one of our Controlling Shareholders

“Xicheng Ruiying” Shenzhen Xicheng Ruiying Investment Consultation Partnership (Limited Partnership)* (深圳市熙城睿盈投資諮詢合夥企業（有限合夥）), a limited liability partnership established in the PRC on February 2, 2016 with Mr. Lv Yuhua as its general partner, one of our Controlling Shareholders

“Yiying Community Technology Shenzhen Yiying Community Technology Group Co., Group” Ltd. (深圳一應社區科技集團有限公司)*, a company established in the PRC with limited liability on February 20, 2012 and a wholly-owned subsidiary of our Company

–23– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. DEFINITIONS

Certain amounts and percentage figures included in this document were subjected to rounding adjustments. Accordingly, figures shown as totals in certain tables may not be an arithmetic aggregation of the figures preceding them.

The English translation of PRC entities, enterprises, nationals, facilities and regulations in Chinese or another language in this document is for identification purposes only. To the extent that there is any inconsistency between the Chinese names of PRC entities, enterprises, nationals, facilities and regulations and their English translations, the Chinese names shall prevail.

* For identification purposes only

–24– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. GLOSSARY OF TECHNICAL TERMS

In this propectus, unless the context otherwise requires, explanation and definitions of certain technical terms used in this document in connection with us and our business shall have the meanings set out below. The terms and their meanings may not correspond to standard industry meanings or usage of such terms.

“average property management calculated as the revenue from property management fee(s)” or “APMF” services during a specific period divided by the total GFA under management at the end of the same period

“AIoT” artificial intelligence of things, the combination of artificial intelligence technologies with the Internet of Things (IoT) infrastructure to achieve more efficient IoT operations, improve human-machine interactions and enhance data management and analytics

“Bohai Region” includes Tianjin, Liaoning province, Jilin province and Heilongjiang province for the purpose of this document

“Central China Region” includes Hubei province, Jiangxi province, Henan province, Shaanxi province and Shanxi province for the purpose of this document

“commercial property(ies)” for purposes of this document, property(ies) designated for commercial use

“commission basis” a revenue-generating model whereby we collect a percentage of the total amount of property management fees that our customers pay on a monthly basis

“common area(s)” common areas in residential properties such as lobbies, hallways, stairways, car parks, elevators and gardens, among others

“contracted GFA” GFA managed or to be managed by our Group under our operating property management service contracts, including both GFA under management and undelivered GFA

“East China Region” includes Shanghai, Shandong province, Anhui province, Jiangsu province and Zhejiang province for the purpose of this document

–25– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. GLOSSARY OF TECHNICAL TERMS

“GFA” gross floor area

“GFA under management” GFA of properties that have been delivered, or are ready to be delivered by property developers, to property owners, for which we are already collecting property management fees in relation to contractual obligations to provide our services

“independent property property management company that derives management company” substantially all of its revenue from properties that are not developed by property developers affiliated with the company

“IoT” the network of physical objects embedded with sensors, software, and other technologies that enable connection and exchange of data with other devices and systems through Internet

“lump-sum basis” a revenue-generating model for our property management business line whereby we charge a pre-determined property management fee per sq.m. for all units (whether sold or unsold) on a monthly or annual basis which represents the “all-inclusive” fees for all of the property management services provided by our employees and sub-contractors. Under a lump sum basis, the property owners and residents and property developers will be responsible for paying our management fees for the sold and unsold units respectively on a periodic basis

“new tier-one cities” Chengdu, Chongqing, Hangzhou, Wuhan, Xian, Tianjin, Suzhou, Nanjing, Zhengzhou, Changsha, Dongguan, Shenyang, Qingdao, Hefei and Foshan

“North China Region” includes Beijing, Hebei province and Ningxia Hui Autonomous Region for the purpose of this document

“renewal rate” the number of property management service contracts successfully renewed during the period divided by the total number of property management service contracts expired during the same period

–26– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. GLOSSARY OF TECHNICAL TERMS

“residential property(ies)” properties which are purely residential or mixed-use properties containing residential units and ancillary facilities that are non-residential in nature such as commercial or office units but excluding pure commercial properties

“retention rate” the aggregate number of properties under management as of the end of the period divided by the aggregate number of properties under management as of the end of the period and properties we cease to manage during th same period

“SaaS” software as a service, a cloud-based software licensing and delivery model in which software are centrally hosted

“South China Region” includes Guangdong Province, Guangxi Zhuang Autonomous Region, Fujian province, Guizhou province, Hunan province and Hainan province for the purpose of this document

“sq.m.” the measurement unit of square meters

“tier-one cities” Beijing, Shanghai, Guangzhou and Shenzhen

“Top 100 Property an annual ranking of China-based property Management Companies” management companies by overall competitiveness published by CIA based on a number of key indicators, including management scale, operational performance, service quality, growth potential and social responsibility

“undelivered GFA” the total GFA of properties that are not ready to be delivered to property owners by property developers, for which we have not begun collecting property management fees in relation to contractual obligations to provide property management services

“West China Region” includes Chongqong, Sichuan province, Yunnan province, Tibet Autonomous Region, Xinjiang Uygur Autonomous Region, Qinghai province, Gansu province and Inner Mongolia Autonomous Region for the purpose of this document

–27– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. FORWARD-LOOKING STATEMENTS

This document contains certain forward-looking statements and information relating to our Company and its subsidiaries that are based on the beliefs of our management as well as assumptions made by and information currently available to our management. When used in this document, the words “aim”, “anticipate”, “believe”, “can”, “continue”, “could”, “forecast”, “expect”, “going forward”, “intend”, “ought to”, “may”, “might”, “plan”, “potential”, “predict”, “project”, “seek”, “should”, “will”, “would” and the negative of these words and other similar expressions, as they relate to our Group or our management, are intended to identify forward-looking statements. Such statements reflect the current views of our management with respect to future events, operations, liquidity and capital resources, some of which may not materialize or may change. These statements are subject to certain risks, uncertainties and assumptions, including the other risk factors as described in this document. You are strongly cautioned that reliance on any forward-looking statements involves known and unknown risks and uncertainties. The risks and uncertainties facing our Company which could affect the accuracy of forward-looking statements include, but are not limited to, the following:

• our operations and business prospects;

• future developments, trends and conditions in the industry and markets in which we operate;

• our strategies, plans, objectives and goals and our ability to successfully implement these strategies, plans, objectives and goals; our ability to identify and integrate suitable acquisition targets;

• general economic, political and business conditions in the markets in which we operate;

• the effects of the global financial markets and economic crisis;

• changes to the regulatory environment and general outlook in the industry and markets in which we operate;

• our ability to control or reduce costs;

• our dividend policy;

• the amount and nature of, and potential for, future development of our business;

• capital market developments;

• the actions and developments of our competitors;

• changes or volatility in interest rates, foreign exchange rates, equity prices or other rates or prices in the industry and markets in which we operate;

–28– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. FORWARD-LOOKING STATEMENTS

• certain statements in sections headed “Business” and “Financial Information” in this document with respect to trends in prices, volumes, operations, margins, overall market trends, risk management and exchange rates; and

• other statements in this document that are not historical facts.

This document also contains market data and projects that are based on a number of assumptions. The markets may not grow at the rates projected by the market data, or at all. The failure of the markets to grow at the projected rates may materially and adversely affect our business and the market price of our Shares. In addition, due to the rapidly changing nature of the PRC economy and the property management industry, projections or estimates relating to the growth prospects or future conditions of the markets are subject to significant uncertainties. If any of the assumptions underlying the market data prove to be incorrect, actual results may differ from the projections based on these assumptions.

We do not guarantee that the transactions and events described in the forward-looking statements in this document will happen as described, or at all. Actual outcomes may differ materially from the information contained in the forward-looking statements as a result of a number of factors, including, without limitation, the risks and uncertainties set forth in the section entitled “Risk Factors” in this document. You should read this document in its entirety and with the understanding that actual future results may be materially different from what we expect. The forward-looking statements made in this document relate only to events as of the date on which the statements are made or, if obtained from third-party studies or reports, the dates of the respective studies or reports. Since we operate in an evolving environment where new risks or uncertainties may emerge from time to time, you should not rely upon forward-looking statements as predictions of future events. We undertake no obligation, beyond what is required by law, to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made, even when our situation may have changed.

Subject to the requirements of applicable laws, rules and regulations, we do not have any and undertake no obligation to update or otherwise revise the forward-looking statements in this document, whether as a result of new information, future events or otherwise. As a result of these and other risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this document might not occur in the way we expect or at all. Accordingly, you should not place undue reliance on any forward-looking information. All forward-looking statements in this document are qualified by reference to the cautionary statements in this section.

–29– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS

Potential investors should carefully consider each of the risks described below and all of the other information contained in this document, including the Accountant’s Report included in Appendix I, before deciding to invest in the [REDACTED]. Our business, financial condition, results of operations or prospects may be materially and adversely affected by any of these risks. You should pay particular attention to the fact that we are a company incorporated in the PRC and that our principal operations are conducted in China and are governed by in a legal and regulatory environment that in some respects differ significantly from that of other countries. The trading price of the [REDACTED] could decline due to any of these risks, as well as additional risks and uncertainties not presently known to us, and you may lose all or part of your investment.

RISKS RELATING TO OUR BUSINESS AND INDUSTRY

Our future growth may not materialize as planned.

We have been seeking to expand our existing business through scaling and organic growth, strategic investment and acquisition, as well as exploring new segments in non-residential properties to expand our project portfolio and obtain larger market shares. As of December 31, 2018, 2019 and 2020 and March 31, 2021, we were contracted to manage projects of an aggregate GFA of 98.3 million sq.m., 133.4 million sq.m., 153.1 million sq.m. and 152.8 million sq.m., respectively. For further details, see “Business—Property Management Services—Overview” in this document. However, we base our expansion plans on our assessment of market prospects, thus we cannot assure you that our assessment will prove to be correct or that our business will grow as planned. Our expansion plans may be affected by a number of factors, most of which are beyond our control. Such factors include but are not limited to:

• changes in China’s economic and social conditions in general and the real estate market and property management industry in particular;

• changes in disposable personal income in the PRC;

• changes in government policies and regulations;

• changes in the supply of and demand for property management services, value-added services to property developers, community value-added services and professional services;

• our ability to generate sufficient liquidity internally and obtain external financing;

• our ability to recruit and train competent employees;

• our ability to select and work with suitable and reliable subcontractors and suppliers;

–30– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS

• our ability to understand the needs of property owners and residents in the properties where we provide property management services, value-added services to property developers, community value-added services and professional services;

• our ability to adapt to new markets where we have no prior experience and in particular, whether we can adapt to the administrative, regulatory, cultural and tax environments in such markets;

• our ability to manage any issues arising from unexpected natural disasters, epidemics, acts of terrorism or war;

• our ability to leverage our brand name and to compete successfully in new markets, particularly against the incumbent players in such markets who might have more resources and experience than us; and

• our ability to improve our administrative, technical, operational and financial infrastructure.

Subject to uncertainties and risks which are mostly beyond our control, we cannot assure you that our future growth will materialize or that we will be able to manage our future growth effectively. Our business, financial condition, results of operations and growth prospects could be materially and adversely affected if our future plans fail to achieve positive results.

We cannot assure you that we can secure new or renew our existing property management service agreements on favorable terms, or at all.

We believe that our ability to expand our portfolio of property management service agreements is key to the sustainable growth of our business. During the Track Record Period, we generally obtained new property management service agreements by participating in tenders. In 2018, 2019 and 2020 and the three months ended March 31, 2021, our renewal rate for property management service agreements was 95.2%, 92.5%, 93.3% and 88.2% respectively, while the retention rate for preliminary property management service agreements was 95.1%, 94.8%, 91.2% and 97.6%, respectively. The selection of a property management company depends on a number of factors, including but not limited to, service quality, industry reputation, pricing level and operational history of the property management company. We cannot assure you that we will be able to procure new property management service agreements on favorable terms, or at all. Our efforts may be hindered by factors beyond our control, which may include, among others, changes in general economic conditions, evolving government regulations as well as supply and demand dynamics within the property management industry.

–31– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS

During the Track Record Period, we entered into preliminary management service agreements with property developers during early stages of property development. Such agreements are transitional in nature and facilitate the transfer of legal and actual control of the properties from property developers to property owners. Preliminary property management service agreements typically expire when property owners’ associations are established and new property management service agreements are entered into. For more information, see “Business—Property Management Services—Property Management Service Agreements” in this document. To continue managing the property, we would have to enter into new property management service agreements with the property owners’ associations. There is no guarantee that property owners’ associations will enter into new property management service agreements with us instead of our competitors. We may therefore bear the risk of termination of rendering services of the existing projects as a result of the set-up of property owners’ associations. Our customers select us based on parameters such as quality and cost, and we cannot assure you that we will always be able to balance them on favorable terms for both sides.

Even where we succeed in entering into property management service agreements with property owners’ associations, we cannot guarantee that they will be renewed upon expiration. It is also possible that they may be terminated for cause. In such cases, we would no longer be able to provide community value-added services to residential communities who have terminated our engagements, in addition to our property management services. There is no guarantee that we would be able to find other business opportunities and enter into alternative property management service agreements on favorable terms, or at all. Moreover, as both termination and non-renewal may be detrimental to our reputation, we may experience material adverse effects to our brand value. We believe that our brand value is essential to our ability to procure new property management service agreements. Failure to cultivate our brand value may diminish our competitiveness within the industry and lead to an adverse effect on our growth prospects and results of operations.

Our future acquisitions may not be successful and we may face difficulties in integrating acquired operations with our existing operation.

We have, to a certain extent, expanded our business through acquisitions during the Track Record Period, and plan to continue to evaluate opportunities to acquire other property management companies and/or other businesses and integrate their operations into our business to further expand our business scale and service and geographical coverage. However, there can be no assurance that we will be able to identify suitable opportunities. Even if we manage to identify suitable opportunities, we may not be able to complete the acquisitions on terms favorable or acceptable to us, in a timely manner, or at all. The inability to identify suitable acquisition targets or complete acquisitions could materially and adversely affect our competitiveness and growth prospects.

–32– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS

In addition, acquisitions and integration of acquired operations with our existing operation involve uncertainties and risks, including, without limitation:

• potential ongoing financial obligations and unforeseen or hidden liabilities;

• inability to apply our business model or standardized operational processes on the acquisition targets;

• difficulties in integrating acquired operations with our existing business;

• failure to achieve the intended objectives, benefits or revenue-enhancing opportunities;

• failure to protect and maintain the acquired rights relating to brand names and/or other material intellectual property rights; and

• diversion of resources and management attention.

Approximately [REDACTED]%, or HK$[REDACTED], of the proceeds raised from the [REDACTED] will be used to pursue selective strategic investment and acquisition opportunities and further develop strategic partnerships. See “Future Plans and Use of Proceeds” in this document for more details. If we fail to identify suitable acquisition opportunities or our future acquisition transactions fail to consummate for other reasons which may be beyond our control, our proceeds from the [REDACTED] may not be effectively used.

We may face fluctuations in our labor and subcontracting costs, and the increase in labor and subcontracting costs could harm our business and reduce our profitability.

The property management industry in the PRC is labor intensive. In 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, our labor costs (recorded as employee benefits expenses) accounted for 33.2%, 34.5%, 35.5%, 36.5%, 38.9% of our total cost of services, respectively. We delegate certain services such as security, cleaning, greening and gardening services to third-party subcontractors. During the same periods, our subcontracting costs (primarily recorded as security, cleaning, greening and gardening services costs) represented 39.1%, 37.2%, 37.2%, 39.5%, 36.2% of our total cost of services, respectively. Since our labor and subcontracting costs together accounted for a significant portion of our cost of services, we believe that controlling and reducing our labor and subcontracting costs is crucial for us to maintain and improve our profit margins as well as other operating costs.

–33– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS

We face pressure from rising labor and subcontracting costs due to various factors, including but not limited to:

• increases in minimum wages. The minimum wage in the regions where we operate has generally increased in recent years, which has a direct impact on our labor costs as well as the fees we pay to our third-party subcontractors.

• increases in headcount. As we expand our operations, the headcount of our property management staff, sales and marketing staff and administrative staff may increase. We may also need to retain and continuously recruit qualified employees to meet our growing demand for talent, which might further increase our total headcount. Any increases in headcount would also increase our costs in relation to, among others, recruiting, salaries, employee benefits, training, social insurance and housing provident fund contributions.

• delay in implementing technological solutions, procedure standardization and operation automation as well as other measures to reduce our reliance on manual labor and cost of services. There is usually a lapse in time between our commencement of property management services for a particular property and any implementation of our technological solutions, management digitalization, service professionalization, procedure standardization and operation automation measures to that property to reduce our reliance on manual labor and cost of services. Before we carry out such measures and upgrades, our ability to mitigate the impact of labor cost increase is limited.

We cannot assure you that we will be able to control our costs or improve our efficiency. Any failure in effectively controlling our costs may have a material and adverse impact on our business, financial position and results of operations.

We may fail to effectively anticipate or control our costs in providing our property management services, for which we generally charge our customers on a lump sum basis.

During the Track Record Period, we primarily generated revenue from our property management services under the lump-sum fee model, which accounted for approximately 98.8%, 98.8%, 98.9%, 99.0%, 99.1% of our total revenue generated from property management services in 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, respectively. On a lump sum basis, we charge property management fees at a monthly or annually pre-determined fixed lump sum price per sq.m., representing “all-inclusive” fees for the property management services provided. These management fees do not necessarily correspond with the actual amount of property management costs we incur. The amount we recognize as revenue is the full amount of property management fees we charge to the property owners or property developers, and the amount we recognize as our cost of services is the actual costs we incur in connection with rendering our services. For more information on our fee model and relevant accounting policy, see “Business—Property Management Services—Property Management Fees—Property Management Fees Charged on a Lump Sum Basis” in this document.

–34– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS

In the event that we fail to accurately anticipate our actual costs prior to negotiating and entering into our property management service agreements, and our fees are insufficient to sustain our profit margins, we would not be entitled to collect additional amounts from our customers. We also cannot guarantee that we will be able to adequately control our costs in the course of providing our property management services. Any losses we incur may materially and adversely affect our results of operations.

In 2018, 2019 and 2020 and the three months ended March 31, 2021, we incurred losses of RMB25.7 million, RMB14.9 million, RMB11.8 million and RMB2.6 million, respectively, with respect to 36, 32, 29 and 19 properties under our management, respectively. Such losses were primarily because the amount of property management fees we received was insufficient to cover the service costs incurred to offer quality property management services.

If we are unable to raise property management fee rates and there is a shortfall of working capital after deducting the property management costs, we would cut costs to reduce the shortfall. However, our ability to mitigate against such losses through cost-saving initiatives, such as automation measures aimed at reducing labor costs and energy-saving measures aimed at reducing energy costs, may not be successful, and our cost-saving efforts may adversely affect the quality of our property management services, which in turn would further reduce the owners’ willingness to pay us higher property management fees. Such events could adversely impact our reputation, profitability, results of operations and financial position.

We may fail to recover payments on behalf of property owners of the properties managed on a commission basis.

For 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, revenue generated from our property management services on a commission basis accounted for 1.2%, 1.2%, 1.1%, 1.0%, 0.9%, respectively, of our total revenue from property management services. When we are contracted to manage properties on a commission basis, we essentially act as an agent of the property owners and residents. Since the management offices of these residential communities have no separate bank accounts, all transactions related to these management offices are settled through our treasury. As of the end of a reporting period, if the working capital of a management office accumulated in our treasury function is insufficient to cover the expenses the management office has incurred as of that reporting period and paid through our treasury function to arrange for property management services at the relevant resident community, the shortfall is recognized as trade and other receivables subject to impairment.

Estimates may need to be made on whether or not the management offices have the ability to settle payments on behalf of property owners and residents and whether there is any objective evidence of impairment, taking into account factors such as the likelihood of subsequent settlement and write-off amounts, if any. If a residential community consistently carries account payables that are higher than their account receivables, this indicates to us that the payments made on the behalf of those property owners and residents may have lower recoverability. Our management estimates and the assumptions on which they are based have been made with information currently available to us, and

–35– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS they may have to be adjusted if new information becomes known. There is also a limited amount of publicly available information to facilitate making these estimates and assumptions. In the event that actual recoverability is lower than initially expected, or that our allowance for bad debts becomes insufficient in light of new information, we may need to increase our allowances and thereby suffer material adverse effects on our business, financial position and results of operations.

We are exposed to risks associated with third-party subcontractors to perform certain services to our customers.

We delegate property management services, such as security, cleaning, greening and gardening services, to third-party subcontractors and the related costs amounted to approximately RMB780.5 million, RMB853.0 million, RMB891.6 million and RMB223.7 million in 2018, 2019, 2020 and the three months ended March 31, 2021, respectively, representing approximately 39.1%, 37.2%, 37.2% and 36.2% of our total cost of services for the same periods, respectively. We select our third-party subcontractors based on factors such as their service quality, industry reputation, license qualification, price, past performance and cooperativeness. We also impose internal quality control measures on our subcontractors such as routine internal examination, independent third-party assessment and customer feedback assessment. See “Business—Suppliers—Selection and Management of Our Subcontractors” and “Business—Quality Control—Quality Control of Subcontractors” in this document for further details. However, we cannot assure you that they will always perform in accordance with our expectations. They may act in ways contrary to our or our customers’ instructions, their contractual obligations and our quality standards and operational procedures. We may also fail to monitor their performance as directly and effectively as with our own employees. As a result, we are subject to risks associated with being responsible for any sub-standard performance by our third-party subcontractors, including but not limited to litigation, reputational damage, disruptions to our business, termination or non-renewal of our service agreements and monetary claims from our customers. We may also incur extra costs in order to monitor or replace third-party subcontractors which do not perform in accordance with our expectations, or mitigate or compensate damages incurred by such third-party subcontractors.

In addition, we may be unable to renew our existing subcontracting contracts upon expiration, or fail to seek suitable replacement in a timely manner, or on favorable terms, or at all. We also do not have control over our subcontractors to maintain qualified, experienced and sizable teams, or renew their qualifications. In any event that our subcontractors fail to perform their contractual obligations properly and in a timely manner, our work process could be interrupted which could potentially result in a breach of contract between our customers and us. Any of such events could materially and adversely affect our service quality, reputation and performance, as well as our business, financial condition and results of operations.

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We are exposed to risks associated with failing to detect and prevent fraud, negligence or other misconduct (accidental or otherwise) committed by our employees, subcontractors or third parties.

We have established risk management and internal control systems consisting of policies and procedures that we believe will contribute to the continued success of our business. See “Business—Internal Control and Risk Management” for more details. However, we cannot guarantee that they will always enable us to detect, prevent and take remedial measures in relation to fraud, negligence or other misconduct (accidental or otherwise) committed by our employees, subcontractors or third parties in a timely and effective manner. Examples of such behavior include crimes such as theft, vandalism and bribery during tenders.

Although we have limited control over the behavior of any of these parties, we may be viewed as at least partially responsible for their conduct on contractual or tortious grounds. We may become, or be joined as, a defendant in litigation or other administrative or investigative proceedings and be held accountable for injuries or damages sustained by our customers or third parties. To the extent that we cannot recover related costs from the employees, subcontractors or third parties involved, we may experience material adverse effects on our business, financial position and results of operations. We may also attract negative publicity and incur damages to our reputation and brand value.

We may not be able to collect property management fees from property owners, residents and/or property developers which could incur impairment losses on our trade receivables.

We may encounter difficulties in collecting property management fees from property owners, especially in communities with relatively high vacancy rate. We cannot assure you that our collection measures will be effective or enable us to accurately predict our future collection rate. In 2018, 2019, 2020 and the three months ended March 31, 2021, our collection rate of property management fees, calculated by dividing the property management fees we actually received during a period by the total property management fees payable to us accumulated during the same period, was 76.1%, 78.6%, 81.1%, 40.0%, respectively. Even though we seek to collect overdue property management fees through a number of collection measures, we cannot assure you that such measures will be effective or enable us to accurately predict our future collection rates.

As of December 31, 2018, 2019 and 2020 and March 31, 2021, our allowance for impairment of trade receivables amounted to RMB122.3 million, RMB180.5 million, RMB192.8 million and RMB206.1 million, respectively. Although our management’s estimates and the related assumptions have been made in accordance with information available to us, such estimates or assumptions are subject to further adjustment if new information becomes known. See the section entitled “Financial Information—Description of Selected Items of Consolidated Balance Sheets—Trade and Other Receivables” in this document for further details. In the event that the actual recoverability is lower than expected, or that our past allowance for impairment of trade receivables becomes insufficient in light of any new information, we may need to provide for an additional allowance for impairment of trade receivables, which may adversely affect our cash flow

–37– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS position and our ability to meet our working capital requirements, and therefore materially and adversely affect our business, financial position and results of operations.

The collection of our trade receivables is subject to seasonal fluctuations.

We experienced seasonal fluctuations in the collection of our trade receivables during the Track Record Period and expect to continue experiencing such seasonal fluctuations going forward. Property owners, tenants and residents tend to settle outstanding property management fee balances toward the second half of the year, especially near the end of the year. In general, our trade receivable amounts increase throughout the year and decrease toward the end of the year when property owners, tenants, and residents clear their outstanding property management fee balances. Seasonal fluctuations in our collection rates and trade receivables require that we manage our liquidity carefully so as to provide our business with adequate cash for operations. Any inability to ensure adequate liquidity may hamper our ability to expand and grow our operations, which could in turn adversely affect our business, financial position and results of operations.

We recorded net current liabilities as of December 31, 2018 and 2019, which could expose us to liquidity risks.

We recorded net current liabilities of RMB520.5 million and RMB518.8 million as of December 31, 2018 and 2019, respectively. We had net current liabilities as of each of these dates primarily due to our trade and other payables of RMB983.1 million and RMB1,022.5 million, respectively, and redeemable shares of RMB569.4 million and RMB562.3 million, respectively. Our net current liabilities expose us to liquidity risk. Our future liquidity, the payment of trade and other payables, our capital expenditure plans and the repayment of our outstanding borrowings as and when they become due will primarily depend on our ability to maintain adequate cash generated from operating activities and adequate external financing. We may have net current liabilities and negative equity in the future, which may limit our working capital for the purpose of operations or capital for our expansion plans and materially and adversely affect our business, financial condition and results of operations. See “Financial Information—Current Assets and Current Liabilities” for further details.

Our strategic plan to diversify our services may not succeed as planned, and therefore our overall growth strategy may not work as expected.

We have diversified our services by providing various value-added services to meet the evolving needs of our customers, whether they are property owners or non-property owners. For more information, please see the section entitled “Business—Business Strategies” in this document. In particular, we aim to further expand our business coverage under our three main business lines, namely, property management services, value-added services to property developers and community value-added services, including but not limited to enhancing our existing services and exploring opportunities

–38– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS to offer new community value-added services, such as space management services, community shopping services, home-living services and car parks management services, to increase accessibility and improve user experience and plan to attract further use by residents of the properties we manage as well as local vendors. See “Business—Business Strategies—Diversify Our Service Offerings to Meet Customer Needs” for more information.

However, our value-added services are still expanding and evolving depending on the circumstances of the project and our accumulated experiences in the relevant local market. With a relatively limited operating history and experience in certain regions, we may face unknown risks, rising expenses and fierce competition in the market. We cannot assure you that we will be able to grow our business as planned. The potential growth of our value-added services depends on our ability to continue to attract new users as well as to increase the spending and repeat purchase rate of existing users. We may fail to cater for various consumer preferences, or anticipate service trends that will appeal to existing potential customers. We may also be unfamiliar with the new business operations in new markets, and fail to effectively promote our new services to new markets. New services, or entrance into new markets, may also require substantial time, resources and capital, and profitability targets. We also may not have the same level of familiarity with the practices for provision of new services or relationships with our strategic partners, third-party subcontractors and other suppliers as we do in the property management industries. We may not be able to recruit sufficient qualified personnel to support the growth of our value-added services. In addition, we may have limited ability to leverage on our brand name in the relevant industries in the way that we have done so in the property management industry, which could put us in a less competitive position in the new market.

Furthermore, we cannot assure you that our investment in our value-added business can be recovered in a timely manner, or at all, or our results of operations would be more competitive than that of other comparable companies. Our development of and investment in our diversified service platform may be subject to PRC laws and regulations governing license approval and renewal. See “Regulatory Overview—Laws and Regulations Relating to Property Management Services and Other Related Services—Qualification of Property Management Enterprises” in this document for further details. We cannot assure you that we can obtain or renew our license on time, if at all. We cannot guarantee that our future strategic development plan, which is based upon our forward-looking assessment of market prospect and customer preference, will always turn out to be successful. A number of factors beyond our control may also affect our plan for the diversified services, which include changes in the PRC’s economic conditions in general, government policies and regulations on relevant industries and changes in supply and demand for our services. Any of the foregoing could adversely affect our reputation, business, cash flows, financial position and results of operations.

–39– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS

Risks relating to natural disasters, epidemics, acts of terrorism or war in the PRC and globally may materially and adversely affect our business.

Natural disasters, epidemics, acts of terrorism or war or other factors that are beyond our control may materially and adversely affect the economy, infrastructure and livelihood of people in the areas where we have or plan to have business operations. In particular, due to their geographic regions, some of these areas are susceptible to the threat of floods, earthquakes, sandstorms, snowstorms, fires or droughts, power shortages or failures, as well as potential wars, terrorist attacks or epidemics such as Ebola, SARS, H1N1, H5N1, H7N9 or, most recently, the novel coronavirus named COVID-19 by the World Health Organization. Any of such events could result in tremendous proprietary damages and losses, personnel injuries and live losses, as well as disruption or destruction of our business operations.

In particular, the COVID-19 virus has spread across the PRC and the world in early 2020. In response to the COVID-19 pandemic, governments across the world have imposed travel restrictions and/or lockdown to contain its transmission. While most of the lockdown measures and related restrictions imposed by the PRC government had been lifted by the end of April 2020, various restrictions still remain in place in the PRC and the world to continue to contain the spread of the COVID-19. COVID-19 had spread around the world, with death toll and number of infected cases continuing to rise. Our business operations in China, including the properties under our management, have been affected due to such travel and other related restrictions. For details, please refer to “Business—Effects of the COVID-19 Outbreak” in this document. We are subject to risks associated with, among others, the potential infection to the residents, tenants or our staff on the properties we managed in the PRC, the shortage of the products and raw materials to support our daily operation and the disruption on the labor recourse available to our group, subcontractors and vendors.

Therefore, any of these and other factors that are beyond our control may create uncertainties within the overall economic environment, thereby causing our business to suffer in ways that we cannot predict, which could materially and adversely affect our business, financial condition and results of operations.

We are susceptible to changes in regulatory landscapes of the PRC property management and PRC real estate industries.

The PRC property management industry and our operations are substantially affected by the relevant regulatory environment and measures. In particular, the fees that property management companies may charge in connection with property management services are strictly regulated and supervised by relevant PRC authorities. We seek to comply with the regulatory regime of the property management service in conducting our business operations. In December 2014, the NDRC issued the Circular of NDRC on the Opinion on Liberalizing Price Controls in Certain Services《國家發展改革委員會關於放開 ( 部分服務價格意見的通知》)(發改價格[2014]2755號), which requires the relevant provincial authorities to relax the price control policies in relation to the property management services for non-affordable housing. Property management fees for affordable housing, housing-reform properties and properties in older residential areas and management fees

–40– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS under preliminary property management service agreements remain subject to price guidance imposed by provincial level price administration departments and the administrative departments of housing and urban-rural development. The PRC Government may also promulgate new laws and regulations in relation to property management fees from time to time. For further information, please refer to the section entitled “Regulatory Overview—Laws and Regulations Relating to Property Management Services and Other Related Services—Fees Charged by Property Management Companies” in this document.

We expect that price controls on residential properties will be relaxed over time. For now, our property management fees are subject to the existing local regulations passed by the relevant authorities to implement the above-mentioned circular issued by NDRC on the Opinion on Liberalizing Price controls in Certain Services. The government-imposed limits on fees, coupled with rising labor and other operating costs, could have a negative impact on our profit. If a property is managed on a lump sum basis, we may experience a decrease in profit margin. If a property is managed on a commission basis, in the event that the collected fees after deducting the commission are insufficient to cover property management expenses, the property owners are legally responsible for making up for such shortage. We cannot assure you that the PRC Government may not reverse its policy and re-impose limits on property management fees. In such event, our profit margins may reduce as our labor, subcontracting and other associated costs increase. We also cannot assure you that we would be able to respond to such changes in a timely manner and effectively by implementing our cost-saving measures, nor that we would be able to pass the additional costs to our customers. The PRC Government may also unexpectedly promulgate new laws and regulations that have potential adverse impact on our business. This could increase our compliance and operational costs, thereby materially and adversely affect our business, financial condition and results of operations.

In addition, a majority of our revenue is generated from our property management services. Therefore, our results of operations depend largely on the total GFA and number of communities we manage. As such, the growth potential of our property management services will be indirectly affected by the PRC real estate industry. The PRC Government has implemented a series of measures with a view to controlling the growth of the economy in relation to real estate in recent years. In particular, the PRC Government has continued to introduce various restrictive measures to discourage speculation in the real estate market. The PRC Government exerts considerable direct and indirect influence on the development of the PRC real estate industry by imposing industry policies and other economic measures, such as control over the supply of land for property development, control of foreign exchange, property financing, taxation and foreign investment. As a result, the PRC Government may restrict or reduce property development activities, place limitations on the ability of commercial banks to make loans to property purchasers, impose additional taxes and levies on property sales and affect the delivery schedule and occupancy rates of the properties we service. The PRC Government may also, from time to time, promulgate new laws and regulations in relation to the PRC real estate industry based on macroeconomic considerations. Therefore, the overall demand for properties may decrease and in turn decelerate the overall growth of property management services and value-added services, which could in turn affect our growth potential and our business expansion.

–41– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS

We face intense competition in the property management market and if we fail to compete successfully against existing and new competitors, our business, financial position, results of operations and prospects may be materially and adversely affected.

According to CIA, the PRC property management industry is intensely competitive and highly fragmented. See “Industry Overview—The Property Management Industry in the PRC” for more details on the competitive landscape. Our major competitors include sizeable property management companies that may have stronger professional knowledge, financial strength and background or affiliation with property developers than we do. We believe that we compete with our competitors on a number of factors, primarily including business scale, brand recognition, financial resources, price and service quality. Such competitors may be able to devote more resources to the development, promotion, sale, and support of their services, and therefore they may be better positioned than we are to compete for customers, financing, skilled management and labor resources. In addition to competition from established companies, emerging companies may enter our existing or new markets. Property developers may also develop their own in-house property management business or engage their affiliated service providers, which could reduce the availability of business opportunities. If we fail to improve and evolve ourselves among the competitors, we may not be able to continue to compete effectively or maintain or improve our market position, and such failure could have a material adverse effect on our business, financial position and results of operations.

We believe our current success can be partially attributed to our standardization of operations in providing our property management services. We plan to refine our service standardization practice to enhance the quality and consistency of our services, improve our on-site service teams’ efficiency and reduce our costs. Our competitors may emulate our business model, and we may lose a competitive advantage that has distinguished ourselves from our competitors. If we do not distinguish ourselves and fail to compete successfully against existing and new competitors, our business, financial position, results of operations and prospects may be materially and adversely affected.

Our rights to use our leased properties could be challenged by third parties, or we may be forced to relocate due to title defects, or we may be liable for failure to register our lease agreements, which may result in a disruption of our operations and subject us to penalties.

As of the Latest Practicable Date, we leased 67 properties in various locations with an aggregated GFA of approximately 18,273 sq.m. for use as offices, staff accommodation and canteens. As of the Latest Practicable Date, we had not registered 66 lease agreements of our leased properties, which are used as office, staff accommodation and canteens with a total GFA of approximately 13,537 sq.m., with the local housing administration authority as required under PRC law, primarily due to the lack of cooperation from the landlord in providing title certificate and proof of ownership and registering the lease agreement, which were beyond our control. Any dispute or claim in relation to the titles of the properties that we occupy, including any litigation involving allegations of illegal or unauthorized use of these properties, could require us to relocate our offices and staff quarters occupying these properties. If any of our leases are terminated or voided as a result of challenges from third parties or the government, we would need to seek

–42– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS alternative premises and incur relocation costs. Any relocation could disrupt our operations and adversely affect our business, financial condition, results of operations and growth prospects. Based on information currently available to us, we believe that there are alternative properties at comparable rental rates readily available on the market and the estimated total relocation cost and time will not be material. In addition, there can be no assurance that the PRC Government will not amend or revise existing property laws, rules or regulations to require additional approvals, licenses or permits, or impose stricter requirements on us to obtain or maintain relevant title certificates for the properties that we use.

We are exposed to liabilities from disputes involving losses or damages incurred by products and services marketed through our community value-added services as well as other incidents in our business that may expose us to liability and reputational risk.

We may encounter different incidents during the course of our business which may materially and adversely affect our business operation. Our community value-added services, including but not limited to space management services, community shopping services, home-living services, and car parks management services. Claims may arise due to employees’ or third-party subcontractors’ negligence or recklessness when performing repair and maintenance services. In addition, product liability may arise from reselling or advertising the products or services through our community value-added services and/or value-added services to property developers under the Laws on the Protection and Rights and Interests of Consumers of the PRC《中華人民共和國消費者權益保護法》 ( ), the Civil Code of the PRC《中華人民共和國民法典》 ( ) and other relevant PRC laws and regulations. For instance, claims may be brought against us by purchasers, regulatory authorities or other third parties alleging, among others, that: (i) the quality of the products sold or services provided by or through us fail to conform to required product or service quality; (ii) advertisements made at service centers we established for the communities we serve with respect to such products or services are false, deceptive, misleading, libelous, injurious to the public welfare otherwise offensive; (iii) such products or services are defective or injurious and may be harmful to others; and (iv) such marketing, communication or advertising infringe on the proprietary rights of other third parties. These occurrences could result in damage to, or destruction of, properties of the communities, personal injury or death and legal liability. Violation of product quality and safety requirements by third-party vendors may subject us to confiscation of related earnings, penalties or an order to cease sales of the defective products. If the offense is determined to be serious, our business license to sell these products could be suspended or revoked and we could be ordered to cease operations pending rectification.

We may be held liable for the personal injuries or property losses of our customers due to the foregoing incidents that may occur during the course of our business. We may be required to recall our products and may face product liability claims due to a material design, manufacturing or quality failure in the products or services offered or advertised by us. Customers may not use the products offered or advertised by or through us in accordance with product usage instructions, possibly resulting in customer injury and our responsibility towards such injuries. Any of these events could materially harm our brand and reputation and marketability of such products or services, which materially and adversely affect our business, results of operation and financial position.

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We may not be able to maintain our historical growth rate and our results of operations during the Track Record Period may not be indicative of our future prospects and results of operations.

Although we experienced revenue and profit growth during the Track Record Period, we cannot assure you that we can sustain such growth in the future. Our profitability depends partially on our ability to control costs and operating expenses, which may increase as we expand our business. In addition, we may continue to devote significant resources to develop our value-added services, which require substantial capital, personnel and technological support. This initiative could negatively impact our short-term profitability and cash flows. If our business expansion prove ineffective, and we fail to increase revenue, or if our cost and operating expense grow faster than our revenue, our business, financial position and results of operations may be negatively affected.

There are uncertainties about the recoverability of our deferred income tax assets, which could adversely affect our results of operations.

As of December 31, 2018, 2019 and 2020 and March 31, 2021, our deferred income tax assets amounted to RMB39.0 million, RMB55.4 million, RMB62.0 million and RMB69.7 million, respectively, which mainly represent temporary differences arising from allowance on doubtful debt, accrued liabilities and provisions. For details on the movements of our deferred income tax assets during the Track Record Period, see “Financial Information—Description of Selected Items of Consolidated Balance Sheets—Deferred Income Tax Assets” and Note 20 to the Accountant’s Report in Appendix I to this document.

Deferred income tax assets are recognized to the extent that it is probably that future taxable profit will be available against which the deductible temporary differences can be utilized. This requires significant judgment on the tax treatments of certain transactions and also assessment on the probability that adequate future taxable profits will be available for the deferred income tax assets to be recovered. We cannot guarantee the recoverability or predict the movement of our deferred income tax assets. If we fail to recover our deferred income tax assets, this may adversely affect our financial position in the future.

Negative publicity, including adverse information on the Internet, about us, our Shareholders and affiliates, our brand, management, vendors as well as products and services provided by us may have a material adverse effect on our business, reputation and the trading price of our Shares.

There could be from time to time negative publicity about us, our Shareholders and affiliates, our brand, management, vendors as well as products and services provided by us. Negative reviews on the properties managed by us, products and services provided by us, our business operations and management may appear in the form of Internet postings and other media sources from time to time and we cannot assure you that other types of negative publicity will not arise in the future. For example, if our services fail to satisfy our customers, our customers may disseminate negative opinions about our services through popular social platforms. Partner vendors for our service may also be subject to

–44– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS negative publicity for quality of their products and services or other public relation incidents with respect to such vendors, which may adversely affect the sales of their products or services on us and indirectly affect our reputation. Any such negative publicity, regardless of veracity, could materially and adversely affect our business, our reputation and the trading price of our Shares.

Damage to the common areas of our managed properties may adversely affect our business, financial position and results of operations.

The common areas of the properties we manage may suffer damage as a result of events beyond our control, including but not limited to natural disasters, accidents or intentional damage. Although PRC laws and regulations mandate that each residential community establishes a special fund to pay the repair and maintenance costs of common areas, there is no guarantee that there will be sufficient sums in those special funds. Where the damage is caused by natural disasters such as earthquakes, floods or typhoons, or accidents or intentional harm such as fires, the damage caused may be extensive. At times additional resources may have to be allocated to assist police and other governmental authorities in investigating criminal actions that may have been involved.

As the property management service provider, we may be viewed as responsible for restoring the common areas and assisting any investigative efforts. In the event that there is any shortfall in the special funds necessary to cover all the costs involved, we may have to compensate for the difference with our own resources first. We would need to collect the amount of the shortfall from the property owners later. To the extent that our attempts are unsuccessful, we may experience material adverse effects on our business, financial position and results of operations. As we intend to continue growing our business, the likelihood of such occurrences may rise in proportion to any increases in the number of our managed properties.

We are exposed to interruptions and security risks in relation to third-party online payment platforms, including but not limited to, security breaches and identity theft, which may result in disruption of our operations and customer complaints, and may expose us to the risk of litigation which could materially and adversely affect our business, financial position, results of operations and our reputation.

We accept payments via various payment methods, including but not limited to online payment or third-party payment platforms. These online payments involve the transmission of confidential information such as credit card numbers, personal information and billing addresses over public networks. A secured transmission of confidential information would be essential to maintain consumer confidence. As the prevalence of using online payment methods increases, associated online crimes will likely increase as well. We have no control over the security measures taken by third-party platforms. In the event that the security and integrity of these third-party platforms are compromised, we may experience material adverse effects on our ability to process our revenue derived from our property management services, community value-added services and other value-added services provided through our service platforms. In addition, increasing and enhancing our security measures and efforts as well as legal compliance during the use of the third-party payment platforms may impose additional costs and expenses but still not guarantee complete safety and compliance. We are

–45– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS exposed to litigation and possible liability in relation to security breaches of the online payment platforms for failing to secure confidential user information. Even if a security breach did not occur on the online payment platforms that we use, if an Internet or mobile network security breach were to occur, the perceived security of online payment platforms in general may be adversely affected and cause users to be reluctant to further use our services. Any leak of confidential information or data, breach of network security, personal data security, or other misappropriation or misuse of personal information, including users’ personal information without prior and proper consent, could cause interruptions in the operations of our business and subject us to increased costs, litigation and other liabilities, which could materially and adversely affect our business, financial position, results of operations and our reputation.

We are exposed to interruptions and security risks in relation to our information technology systems, which may result in disruption of our operations.

We rely on our information technology systems to manage key operational functions. For example, we rely on information technology systems to, among others, maintain quality control, which involves the collection and management of customer inquiries, requests and feedbacks, and organizing and tracking of our responses, follow-ups and conducting and recording internal assessments on service issues. See “Business—Quality Control” for more information. We operate under a comprehensive internal management system, where information related to human resources and financials is processed automatically. However, we cannot guarantee that damages or interruptions caused by power outages, computer viruses, hardware and software failures, telecommunication failures, fires, natural disasters, security breaches and other similar occurrences relating to our information technology systems will not occur in the future. If we fail to detect any system error or malfunction, continue to upgrade our information technology systems and network infrastructure, or take other measures to improve the efficiency of our information technology systems, system interruptions or delays could occur, which could adversely affect our operating results. In addition, occasional system interruptions and delays may occur to our information technology systems or any other customer service systems that make our services unavailable or difficult to access, and prevent us from promptly responding or providing services to our customers, which could reduce the attractiveness of our services and even incur losses to our customers who may bring legal proceedings against us. Moreover, we may incur significant costs in restoring any damaged information technology systems or to comply with any relevant data protection requirements under the relevant PRC laws and regulations. Failures in or disruptions to our information technology systems and loss or leakage of confidential information could cause transaction errors, processing inefficiencies and the loss of customers and sales. We may thus experience material adverse effects on our business and results of operations.

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Our success depends on the continued services of our Directors, senior management and other qualified employees.

Our continued success is highly dependent upon the efforts of our Directors, senior management and other qualified employees who are experienced in property management and related industries. We believe their professional skills and high status in the industry will make us more competent and outstanding. If a material number of our qualified employees leaves and we are unable to promptly hire and integrate a suitable replacement, our business, financial position and results of operations may be materially and adversely affected. In addition, the future growth of our business will depend, in part, on our ability to attract and retain qualified personnel in all aspects of our business, including corporate management and property management personnel. If we are unable to attract and retain these qualified personnel, our growth may be limited and our business, financial position and operating results could be materially and adversely affected. See “Directors, Supervisors and Senior Management—Board of Directors” for more information.

Our failure to protect our intellectual property rights could have a negative impact on our business and competitive position.

Our intellectual properties are our crucial business assets, which are key to our customer loyalty and essential to our future growth. The success of our business depends substantially upon our continued ability to use our trade names and trademarks to increase brand recognition and to develop our business brands. Please refer to the section entitled “Business—Intellectual Property” in this document for further information. Unauthorized reproduction or infringement of our trade names or trademarks could diminish the value of our brands as well as our market reputation and competitive advantages. The unauthorized third party may use our intellectual property in ways that damage our reputation and brand names, such as providing services that are at lower standards or handling customer relationship in bad manner.

We rely on a combination of trademarks, confidentiality procedures and contractual provisions as well as legal registration to protect our intellectual property rights. Nevertheless, we cannot guarantee that such measures provide full protection. Policing unauthorized use of proprietary information can be difficult and expensive. In addition, the intellectual property laws and regulations in the PRC are still immature as compared with most developed countries, and therefore the enforceability, scope and validity of laws governing intellectual property rights in the PRC are uncertain and still evolving, which could involve substantial risks to us. If we fail to detect unauthorized use of, or take appropriate steps to enforce, our intellectual property rights, it could have a material adverse effect on our business, results of operations and financial position.

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We may fail to obtain or renew required permits, licenses, certificates or other relevant PRC governmental approvals necessary for our business operations.

We are required to obtain certain governmental approvals in the form of permits, licenses and certificates or other approvals in order to provide our services, and the material permits, licenses and/or certificates include Food Business License (食品經營許可證), Car Parks Permit/Registration (停車場許可╱備案), Special Equipment Production License (特種設備生產許可) and Filing for Company’s Self-Recruiting Security Guards (自行招用保安員單位備案). Generally, they are only issued or renewed after certain conditions have been satisfied. We cannot assure you that we will not encounter obstacles toward fulfilling such conditions that delay us in obtaining or renewing, or result in our failure to obtain or renew, the required governmental approvals. Moreover, we anticipate that the PRC Government and relevant authorities will promulgate new policies in relation to the conditions for issuance or renewal from time to time.

We cannot guarantee that such new policies will not present unexpected obstacles toward our ability to obtain or renew the required permits, licenses and certificates or that we will be able to overcome these obstacles in a timely manner, or at all. Loss of or failure to obtain or renew our permits, licenses and certificates may stall our business operations, possibly leading to material adverse effects on our business and results of operations.

Our insurance may not sufficiently cover, or may not cover at all, losses and liabilities we may encounter during the ordinary course of operation.

We purchase and maintain insurance policies that we believe to be aligned with the standard commercial practice in our industry and as required under relevant laws and regulations. See “Business—Insurance” in this document for further information. However, we cannot assure that our insurance coverage will be sufficient or available to cover damage, liabilities or losses we may incur in the ordinary course of our business. We do not carry any business interruption insurance or litigation insurance as aligned with the customary market practice in the PRC. In additional, there are certain losses for which insurance is not available in the PRC on commercially practicable terms, such as losses suffered due to business interruptions, earthquakes, typhoons, flooding, war or civil disorder. If we are held responsible for any such damages, liabilities or losses and there is an insufficiency or unavailability of insurance, we could suffer significant costs and diversion of our resources, and thereby materially and adversely affect our business, financial condition and results of operation.

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Accidents in our business may expose us to liability and reputational risks.

Accidents, such as work injuries, may occur during the course of our business. For example, repair and maintenance services performed by our employees may involve the handling of tools and machinery that carry the inherent occupational risk of accidents. As a result, we are exposed to risks in relation to work safety, including but not limited to claims for injuries, fatal or otherwise, sustained by our employees. To the extent that we incur additional costs, we may suffer material adverse effects to our business, financial position, results of operations and brand value. In addition, we are exposed to claims that may arise due to employees’ negligence or recklessness when performing repair and maintenance services. We may be held liable for the injuries or deaths of employees, residents or others. Our insurance may not fully cover the claims or costs arising from such accidents. We may also experience interruptions to our business and may be required to change the manner in which we operate as a result of governmental investigations or the implementation of safety measures upon occurrence of accidents. Moreover, such occurrences may also damage our reputation and brand in the property management industry. Any of the foregoing could adversely affect our reputation, brand, business, financial position and results of operations.

We may be involved in legal and other disputes and claims from time to time during the ordinary course of operation.

We may, from time to time, be involved in disputes with and subject to claims by property developers, property owners and residents, to whom we provide property management services. Disputes may also arise if they are dissatisfied with our services. In addition, property owners may take legal action against us if they perceive that our services are inconsistent with our contractual service standards. Furthermore, we may from time to time be involved in disputes with and subject to claims by other parties involved in our business, including our third-party subcontractors, suppliers and employees, or other third parties who sustain injuries or damages while visiting properties under our management. See “Business—Legal Proceedings and Compliance—Ongoing Litigation” for more details on the ongoing litigation matter. All of these disputes and claims may lead to legal or other proceedings or cause negative publicity against us, thereby resulting in damage to our reputation, substantial costs and diversion of resources and management’s attention from our business activities. Any such dispute, claim or proceeding may have a material adverse effect on our business, financial position and results of operations.

Any claims by third parties alleging possible infringement of their intellectual property rights would have a material adverse effect on our business, brand value and reputation.

We may become subject to claims from competitors or third parties alleging intellectual property infringement in our ordinary course of business from time to time. Any claims or legal proceedings brought against us in relation to such issues, with or without merit, could result in substantial costs and divert capital resources and management attention. In the event of an adverse determination, we may be compelled to pay substantial damages or to seek licenses from third parties and pay ongoing royalties on unfavorable terms. Moreover, regardless of whether we prevail, intellectual property disputes may damage our brand value and reputation in the eyes of current and potential customers and within our industry.

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We may be subject to fines for any inability to comply with national environmental, health and safety standards.

We are subject to extensive and increasingly stringent environmental protection, health and labor safety laws, regulations and decrees that impose fines for violation of such laws, regulations or decrees. In addition, there is a growing awareness of environmental, health and labor safety issues, and we may sometimes be expected to meet a standard which is higher than the compulsory requirements. We cannot guarantee that more stringent environmental protection, health and labor safety requirements or standards will not be imposed in the future. We cannot assure you that our procedures and training will be completely effective in satisfying all relevant environmental and safety requirements. If we are unable to comply with existing or future environmental, health and labor safety laws and regulations or are unable to meet public expectations in relation to relevant matters, our reputation may be damaged or we may be required to pay penalties or fines or take remedial actions and our operations may be suspended, any of which may materially and adversely impact our business, financial position, results of operations and growth prospects.

The preferential income tax treatment that we enjoy in the PRC may be altered or terminated.

We cannot assure you that the PRC policies on preferential tax treatment will not change or that any preferential tax treatment we enjoy or will be entitled to enjoy will not be terminated. According to the applicable PRC tax regulations, the statutory enterprise income tax rate in the PRC is 25%. Our certain subsidiaries in the PRC are qualified as small scale taxpayers and are subject to a preferential income tax rate of 20% in certain years. We cannot assure you that we will continue to enjoy the aforementioned preferential income tax treatment. If the applicable PRC tax regulations change, if we fail to renew any preferential tax treatment qualification in time or at all, or if any change or termination of preferential tax treatment occurs, the increase in our tax change or any other related tax liabilities could materially and adversely affect our results of operations and financial condition.

Some of our property management service agreements were obtained without going through the required tender and bidding process.

As of the Latest Practicable Date, for two property management projects, we had been engaged without going through the required tender and bidding process under applicable PRC laws and regulations. Such properties had an aggregate GFA under management of approximately 90,000 sq.m. as of the Latest Practicable Date. Our revenue from property management services for such properties amounted to approximately RMB1.2 million, RMB2.2 million, RMB3.4 million and RMB0.8 million, respectively, in 2018, 2019 and 2020 and the three months ended March 31, 2021, accounting for approximately 0.1%, 0.1%, 0.1% and 0.1%, respectively, of our total revenue for the same periods.

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Under the Property Management Regulations, a residential property developer shall hire property management service providers by going through a tender and bidding process. According to the Property Management Regulations, a residential property developer may be required to take rectification measures within a prescribed period and pay fines up to RMB100,000 if it fails to comply with such tender and bidding requirement.

The lack of a tender and bidding process for the selection of property management service providers for the abovementioned property management projects was not caused by us but by the relevant property developers. As advised by our PRC Legal Advisor, current PRC laws and regulations are silent on whether a property management service provider shall be subject to any administrative penalty if it was contracted without a required tender and bidding process. However, such property management contracts may be determined to be invalid by the administrative authorities or the local judicial authorities. If this occurs, we may lose a portion of our revenue accrued under such property management contracts. In addition, the relevant property developer may need to organize a tender and bidding process to select a property management service provider for their developed projects. In the case that we do not win the tender and bidding, we may not continue our property management services for the relevant projects and, as a result our revenue and business may be negatively impacted.

If we are unable to perform our contracts with customers, our results of operations and financial condition may be adversely affected.

As of December 31, 2018, 2019 and 2020 and March 31, 2021, our contract liabilities amounted to RMB162.5 million, RMB209.7 million, RMB205.1 million and RMB157.9 million, respectively. Our contract liabilities primarily arise from the advance payments received from customers of our property management services while the underlying services are yet to be provided by us. If we fail to fulfill our obligations under our contracts with customers, we may not be able to convert such contract liabilities into revenue, and our customers may also require us to refund the property management fees we have received, which may adversely affect our cash flow and liquidity condition and our ability to meet our working capital requirements and in turn, our results of operations and financial condition. In addition, if we fail to fulfill our obligations under our contracts with customers, it may also adversely affect our relationship with such customers, which may in turn affect our reputation and results of operations in the future.

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The fair value measurement of our financial assets at fair value through profit or loss are subject to significant uncertainties and risk and the fair value change of such assets may materially and adversely affect our results of operations.

During the Track Record Period, we have recorded certain financial assets at fair value through profit or loss, which mainly included wealth management products. For further details, see the Note 22 to the Accountant’s Report included in Appendix I to this document. We are required to reassess the fair value of our financial assets at fair value through profit or loss on every balance sheet date for which we issue consolidated financial statements. The fair value of our financial assets was and will be determined by various applicable valuation techniques, including discounted cash flow approach, which involves multiple assumptions and estimates. The assumptions and estimates include unobservable inputs and require significant management judgment or estimation and are inherently uncertain as they may fluctuate over time. In accordance with HKFRSs, we must recognize changes to the fair value of our financial assets as a gain or loss (as applicable) in our income statements. The recognition of any such gain or loss reflects unrealized capital gains or losses on our financial assets on the relevant balance sheet dates and does not generate any actual cash inflow or outflow. During the Track Record Period, we did not record significant fair value gains or loss on financial assets at fair value through profit or loss. The amount of evaluation adjustments have been, and may continue to be, significantly affected by the prevailing market conditions and subject to fluctuations and our determinations of fair value may differ materially from the values that would have been used if a ready market for these financial assets or investment properties existed. We cannot assure you that our determinations turn out to be accurate or the fair value of our financial assets and our investment properties will not fluctuate in the future and any decrease in the fair value of our financial assets or our investment properties could have an adverse effect on our results of operations and financial condition.

Our reputation may be adversely affected by customer complaints even if they may be frivolous or vexatious.

Our customers may file complaints or claims against us regarding our services. Our customers are largely individual property owners and residents and our business is to provide property management and other services to them, which includes addressing the everyday needs of their homes and their families. These property owners and residents, even though living in the same property under our management, come from all walks of life and may have different expectations on how their properties and neighborhoods should be managed. As a result, during our ordinary course of business, we need to strike a balance among these varying expectations among different groups of property owners and residents.

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Although we have established procedures to monitor the quality of our services and maintained communication channels through which customers may provide feedbacks and complaints, there is no assurance that all property owners’ and residents’ expectations and demands can be addressed in a timely and effective manner. There is no guarantee that certain individual property owners and residents and/or groups of property owners and residents of a property under our management will not have specific demands or expectations which are beyond what we can provide within our normal course of operations. Furthermore, there is no guarantee that, in order to compel us to meet these demands, such property owners and residents will not attempt to exert pressure on us by means beyond our control, such as by way of lodging or making frivolous or vexatious complaints directly to us or through various media sources. Any of such events or any negative publicity thereof, regardless of veracity, may distract our management’s attention and may have an adverse effect on our business, our reputation and the price of our Shares.

During the Track Record Period and up to the Latest Practicable Date, we did not receive any complaints from our customers that may have a material adverse impact on our operations and financial position. Nevertheless, our Directors cannot assure you that we will not receive customer complaints which may affect our reputation even if the complaints are frivolous or vexatious.

We may be subject to fines for our failure to register for and/or contribute to social insurance fund and housing provident fund on behalf of some of our employees.

During the Track Record Period, our Company and some of our PRC subsidiaries did not register for and/or fully contribute to certain social insurance and housing provident funds for their employees. As such, we may be subject to late fees and fines for our insufficient contributions to the social insurance plans and housing provident fund as well as non-registration of an account for housing provident fund. As of the Latest Practicable Date, we had not received any notice from the local government authorities regarding any claim for inadequate contribution of our current and former employees. We made provisions in the amounts of RMB0.9 million, RMB2.0 million, RMB2.3 million, and RMB0.7 million, in 2018, 2019 and 2020 and the three months ended March 31, 2021, respectively.

According to the relevant PRC laws and regulations, (i) for outstanding social insurance fund contributions that we did not fully pay within the prescribed deadlines, the relevant PRC authorities may demand that we pay the outstanding social insurance contribution within a stipulated deadline and we may be liable for a late payment fee equal to 0.05% of the outstanding contribution amount of each day of delay; if we fail to make such payments within a stipulated deadline, we may be liable to a fine of one to three times of the outstanding contribution amount; and (ii) for the housing provident fund registration that we fail to complete before the prescribed deadline, the relevant government authorities may demand that we complete the housing provident fund registration by a stipulated deadline. If we fail to rectify by that deadline, we may be subject to a fine ranging from RMB10,000 to RMB50,000 for each non-compliant subsidiaries or branches and, for outstanding housing provident fund contributions that we did not fully pay within the prescribed period, the relevant government authorities

–53– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS may demand that we pay the outstanding housing provident fund contributions by a stipulated deadline. If we fail to rectify by that deadline, we may be subject to an order from the relevant People’s court for compulsory enforcement. We cannot assure you that the relevant local government authorities will not require us to pay the outstanding amount within a specific time limit or impose late or additional fees or fines on us, which may materially and adversely affect our financial condition and results of operation.

RISKS RELATING TO CONDUCTING BUSINESS IN THE PRC

The PRC economic, political and social conditions as well as government policies could affect our business, results of operation, financial position and prospects.

Our business, assets and operations are located in the PRC. Therefore, our business, results of operation, financial position and prospects are, subject to the economic, political, social and legal conditions in the PRC. The economy of the PRC differs from the economies of most developed countries in many respects, including, among other things, structure, level of government involvement, level of development, growth rate, control of foreign exchange and allocation of resources.

The PRC has transformed from a planned economy to a market oriented economy since 1978. While the PRC economy has grown significantly in the past four decades, growth has been uneven, both geographically and among the various sectors of the economy. The PRC Government has implemented various measures to encourage economic growth and guide the allocation of resources. Some of these measures benefit the overall PRC economy, but may also negatively affect our operations. For example, our financial position and results of operations may be adversely affected by the PRC Government’s control over capital investment, price controls or any changes in tax regulations or foreign exchange controls that are applicable to us. In addition, many of the reform measures are unprecedented or experimental and are expected to be modified from time to time. Other political, economic and social factors may lead to further adjustment. Going forward, our business may, from time to time, be subject to the transforming economic situations and legal environment in the PRC. In particular, demand for our services and our business, financial position and results of operations may be adversely affected by:

• political instability or changes in social conditions in the PRC;

• changes in laws, regulations or policies or the interpretation of laws, regulations or policies;

• measures which may be introduced to control inflation or deflation;

• changes in interest rates or market disruptions experienced in overseas markets that directly or indirectly affect the capital markets of the PRC;

• changes in the rate or method of taxation; and

• imposition of additional restrictions on currency conversion and remittances abroad.

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Furthermore, there is no assurance that the substantial growth in the PRC economy in the previous decades will continue or continue at the same pace. In May 2017, Moody’s Investors Service downgraded China’s sovereign credit rating for the first time since 1989 and changed its outlook from stable to negative, citing concerns on the country’s rising levels of debt and expectations of slower economic growth. In recent years, the trade war between the U.S. and China further slows down the growth of the PRC economy and gives rise to uncertainties on the global economy. Should the trade war materially impact the PRC economy, the purchasing power and needs of our customers could be negatively affected. The full impact of relevant events remains to be seen, but the perceived weaknesses in China’s economic development model, if proven and left unchecked, would have profoundly adverse implications.

Holders of our H Shares who are foreign individuals are subject to PRC income tax, and there are uncertainties as to the PRC tax obligations of holders of our H Shares who are foreign enterprises.

Under applicable PRC tax laws, regulations and rules, non-PRC resident individuals and non-PRC resident enterprises who are holders of our H Shares are subject to different tax obligations. Under the Individual Income Tax Law of the PRC《中華人民 ( 共和國個人所得稅法》) and its implementation regulations, non-PRC resident individuals are required to pay PRC individual income tax at a 20% rate for dividends received from us and the gains realized upon the sale or other disposition of the H Shares held by them. We are required to withhold such tax from dividend payments, unless applicable tax treaties between China and the jurisdictions in which the foreign individuals reside, reduce or provide an exemption for the relevant tax obligations. Generally, a tax rate of 10% shall apply to the dividends paid by companies listed in Hong Kong to non-PRC resident individuals, pursuant to Circular of the State Administration of Taxation on Individual Income Tax Collection Issues upon Abolishment of Document Guoshuifa [1993] No. 045《國家稅務總局關於國稅發 ( [1993]045號文件廢止後有關個人所得稅徵管問題的通知》). Where the 10% tax rate is not applicable, the withholding company shall: (i) return the excessive tax amount pursuant to the relevant procedures if the applicable tax rate is below 10%; (ii) withhold such income tax payable by the foreign individual at the applicable tax rate if the applicable tax rate is between 10% and 20%; and (iii) withhold such foreign individual income tax at a rate of 20% if no double tax treaty is applicable.

In addition, although under the Individual Income Tax Law of the PRC and its implementation regulations, non-PRC resident individuals are subject to individual income tax at a rate of 20% on gains realized upon sale or other disposition of H Shares, pursuant to the Circular Declaring That Individual Income Tax Continues to Be Exempted over Income of Individuals from Transfer of Shares《關於個人轉讓股票所得繼續暫免徵收 ( 個人所得稅的通知》) issued by the MOF and the SAT, income of individuals derived from the transfer of shares in listed companies continued to be temporarily exempt from individual income tax. There is no assurance that such tax exemption will continue in the future. If such tax is collected in the future, the value of non-PRC resident individuals’ investments in our H Shares may be materially and adversely affected. For non-PRC resident enterprises that do not have establishments or premises in China, or have establishments or premises in China but their income is not related to such establishments or premises, under the EIT Law, dividends paid by us and the gains realized by such

–55– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS non-PRC resident enterprises from the sales or other disposition of H Shares are subject to PRC enterprise income tax at a rate of 20%. In accordance with the EIT Law Implementation Rules and the Notice on the Issues Concerning Withholding the Enterprise Income Tax on the Dividends Paid by Chinese Resident Enterprise to Shareholders Which are Overseas Non-resident Enterprises《關於中國居民企業向境外 ( H股非居民企業股東派發股息代扣代繳企業所得稅有關問題的通知》) issued by the SAT, such tax rate has been reduced to 10%, which is subject to a further reduction under an applicable treaty or a special arrangement between China and the jurisdiction of the residence of the relevant non-PRC resident enterprise. According to the Arrangements between Mainland China and the Hong Kong Special Administrative Region for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Incomes《內地和 ( 香港特別行政區關於對所得避免雙重徵稅和防止偷漏稅的安排》) which was promulgated on August 21, 2006 and became effective on December 8, 2006, any non-resident enterprise registered in Hong Kong that holds directly at least 25% of the shares of our Company shall pay enterprise income tax for the dividends declared and paid by us at a tax rate of 5% subject to the satisfaction of certain conditions such as approval by the relevant PRC tax authority. According to Announcement of the State Administration of Taxation on Issues Related to “Beneficial Owners” in Tax Agreements《國家稅務總局關於稅收協定中 ( 「受益所有人」有關問題的公告》, which was promulgated on February 3, 2018 and became effective on April 1, 2018, the principle of substance over form and analysis of beneficial ownership shall be used to decide whether to grant preferential tax policies.

There are significant uncertainties as to the interpretation and enforcement of the relevant PRC tax laws, regulations and rules, including whether the reductions, exemptions and other beneficial tax treatments mentioned above will be revoked in the future such that all non-PRC resident individual holders of our H Shares will be subject to PRC individual income tax at a flat rate of 20%. There are also significant uncertainties as to how the PRC tax authorities interpret the relevant PRC tax laws, regulations and rules, such as the taxation of capital gains by non-PRC resident enterprises, individual income tax on dividends paid to non-PRC resident individual holders of our H Shares and on gains realized on sale or other disposition of our H Shares. PRC’s tax laws, rules and regulations may also change. Any ambiguities relating to, or any change to, applicable PRC tax laws, regulations and rules as well as their interpretations and enforcement could materially and adversely affect the value of your investment in our H Shares.

Governmental control of currency conversion may limit our ability to use capital effectively.

The PRC Government imposes controls on the convertibility of Renminbi into foreign currencies and, in certain cases, the remittance of currency out of China. Please see “Taxation and Foreign Exchange—Laws and Regulations Relating to Foreign Exchange Control” in Appendix IV to this document. We receive all our revenue in Renminbi. The foreign exchange control system may prevent us from obtaining sufficient foreign currency to satisfy our currency demands. Shortages in the availability of foreign currency may restrict our ability to remit sufficient foreign currency to pay dividends or other payments to our shareholders, or otherwise satisfy our foreign currency denominated obligations, if any.

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The PRC Government may also at its discretion restrict access in the future to foreign currencies for current account transactions. Under existing PRC foreign exchange regulations, payments of certain current account items can be made in foreign currencies without prior approval from the local branch of SAFE by complying with certain procedural requirements. However, approval from appropriate government authorities is required where Renminbi is to be converted into foreign currency and remitted out of China to pay capital expenses such as the repayment of indebtedness denominated in foreign currencies. The restrictions on foreign exchange transactions under capital accounts could also affect our ability to obtain foreign exchange through debt or equity financing, including by means of loans or capital contribution from us.

Payment of dividends is subject to restrictions under PRC law.

Under PRC law, dividends can only be paid out of distributable profit of a PRC company. Distributable profit is our profit as determined under PRC GAAP, whichever is lower, less any recovery of accumulated losses and appropriations to statutory and other statutory funds we are required to make. As a result, we may not have sufficient or any distributable profit that allows us to make dividend distributions to our Shareholders, especially during the periods for which our financial statements indicate that our operations have been unprofitable. Any distributable profit not distributed in a given year is retained and available for distribution in subsequent years.

Fluctuation in the value of the Renminbi may have a material adverse effect on our business.

Our business is conducted in Renminbi. However, following the [REDACTED],we may also maintain a significant portion of the proceeds in Hong Kong dollars before they are used in our PRC operations. The value of the Renminbi against the US dollar, Hong Kong dollar and other currencies may be affected by changes in the PRC’s policies and international economic and political developments. As a result of these and any future changes in currency policy, the exchange rate may become volatile, the Renminbi may be revalued further against the US dollar or other currencies or the Renminbi may be permitted to enter into a full or limited free float, which may result in an appreciation or depreciation in the value of the Renminbi against the US dollar or other currencies. Fluctuations in exchange rates may adversely affect the value, translated or converted into US dollars or Hong Kong dollars, which are pegged to the US dollar, of our cash flows, revenues, earnings and financial position, and the value of, and any dividends payable to us by our PRC subsidiaries. An appreciation of the Renminbi against the US dollar or the Hong Kong dollar would make any new Renminbi-denominated investments or expenditures more costly to us, to the extent that we need to convert US dollars or Hong Kong dollars into Renminbi for such purposes.

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Inflation in China could negatively affect our profitability and growth.

Economic growth in China has, in the past, been accompanied by periods of high inflation. In response, the PRC Government has implemented policies from time to time to control inflation, such as restricting the availability of credit by imposing tighter bank lending policies or higher interest rates. The PRC Government may take similar measures in response to future inflationary pressures. Rampant inflation without the PRC Government’s mitigation policies would likely increase our costs, thereby materially reducing our profitability. There is no assurance that we will be able to pass any additional costs to our customers. On the other hand, such control measures may also lead to slower economic activity and we may see reduced demand for our properties management service.

Uncertainty with respect to the PRC legal system could adversely affect our business and may limit the legal protection available to you.

As our businesses are conducted and our assets are almost all located in the PRC, we are governed principally by the PRC laws and regulations. The PRC legal system is based on written statutes, and prior court decisions can only be cited as reference. Although the PRC Government has promulgated laws and regulations in relation to economic matters such as foreign investment, corporate organization and governance, commerce, taxation, finance, foreign exchange and trade, with a view to developing a comprehensive system of commercial law since 1978, China has not developed a fully integrated legal system. The recent laws and regulations may not sufficiently cover all aspects of economic activities in China, or may be unclear or inconsistent. In particular, since the property management industry is in its early developmental stage in the PRC, the laws and regulations relating to this industry are evolving and may not be comprehensive. Because of the limited volume of published decisions and their non-binding nature, the interpretation and enforcement of PRC laws and regulations involve uncertainties and can be inconsistent. Even where adequate laws exist in China, the enforcement of existing laws or contracts may be uncertain or sporadic, and it may be difficult to obtain swift and equitable enforcement of a judgment by a PRC court. Furthermore, the PRC legal system is based in part on government policies and internal rules, some of which are not published on a timely basis, or at all, that may have a retroactive effect. As a result, we may not be aware of our violation of these policies and rules in a timely manner. Finally, any litigation in China may be protracted and result in substantial costs and the diversion of resources and management’s attention. The materialization of all or any of these uncertainties could have a material adverse effect on our financial position and results of operations.

–58– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS

It may be difficult to effect service of process on our Directors or executive officers who reside in the PRC or to enforce against us or them in the PRC any foreign judgments.

We are incorporated in the PRC. A majority of our senior management members reside in the PRC. Therefore, it may be difficult for investors to effect service of process upon those persons inside the PRC or to enforce against us or them in the PRC any foreign judgments. China does not have treaties providing for the reciprocal recognition and enforcement of judgments of courts with the United States, the United Kingdom, Japan and many other developed countries. Therefore, recognition and enforcement in China of judgments of a court in any of these jurisdictions may be difficult or even impossible. On July 14, 2006, the Supreme People’s Court of China and the Government of Hong Kong entered into the Arrangement on Reciprocal Recognition and Enforcement of Judgments in Civil and Commercial Matters《關於內地與香港特別行政區法院相互認可和執行當事人 ( 協議管轄的民商事案件判決的安排》). Pursuant to the Arrangement, a party with a final court judgment rendered by a Hong Kong court requiring payment of money in a civil and commercial case pursuant to a choice of court agreement in writing may apply for recognition and enforcement of the judgment in the PRC. Similarly, a party with a final judgment rendered by a PRC court requiring payment of money in a civil and commercial case pursuant to a choice of court agreement in writing may apply for recognition and enforcement of such judgment in Hong Kong. A choice of court agreement in writing is defined as any agreement in writing entered into between the parties after the effective date of the arrangement in which a Hong Kong or PRC court is expressly designated as the court having sole jurisdiction for the dispute. Therefore, it may not be possible to enforce a judgment rendered by a Hong Kong court in the PRC if the parties in dispute do not agree to enter into a choice of court agreement in writing. It may be also difficult or impossible for investors to enforce a Hong Kong court judgment against our assets or our Directors or senior management in the PRC.

RISKS RELATING TO THE [REDACTED]

Purchasers of our [REDACTED] in the [REDACTED] will experience immediate dilution and may experience further dilution if we issue additional Shares in the future.

The [REDACTED] of our [REDACTED] is higher than the consolidated net tangible assets per Share immediately prior to the [REDACTED]. Therefore, if we distribute our net tangible assets to our Shareholders immediately following the [REDACTED], purchasers of our [REDACTED] in the [REDACTED] will experience an immediate dilution in unaudited pro forma adjusted consolidated net tangible assets and will receive less than the amount they paid for their Shares.

In order to expand our business, we may consider offering and issuing additional Shares in the future. We may also raise additional funds to finance future acquisitions or expansions of our business operations by issuing new Shares or other securities of our Company in the future. As a result, purchasers of our [REDACTED] may experience dilution in the net tangible assets value per Share of their investments in the [REDACTED] and such newly issued Shares or other securities may confer rights and privileges that have priority over those of the then Shareholders.

–59– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS

There has been no prior public market for our Shares and the liquidity and market price of our H Shares may be volatile.

Prior to completion of the [REDACTED], there has been no public market for our [REDACTED]. The initial [REDACTED] for our [REDACTED] was the result of negotiations among us and the [REDACTED] and the [REDACTED] may differ significantly from the market price for our H Shares following the [REDACTED]. There is no assurance that an active, liquid public trading market for our Shares will develop and be sustained following the completion of the [REDACTED]. The market price of our Shares may drop below the [REDACTED] at any time after completion of the [REDACTED] if an active public market for our Shares does not develop following the completion of [REDACTED].

The liquidity and market price of our H Shares may be volatile, which may result in substantial losses for investors subscribing for or purchasing our [REDACTED] pursuant to the [REDACTED].

The price and trading volume of our H Shares may be volatile as a result of the following factors, as well as others, which are discussed in this “Risk Factors” section or elsewhere in this document, some of which are beyond our control:

• variations in our financial position and/or results of operations;

• unexpected business interruptions resulting from, among others, natural disasters or power shortage;

• our inability to compete effectively in the market;

• major changes in our key personnel or senior management;

• loss of visibility in the markets due to lack of regular coverage of our business;

• strategic alliances or acquisitions;

• changes in laws and regulations in China;

• changings in securities analysts’ estimates of our financial condition and/or results of operations, regardless of the accuracy of information on which their estimates are based;

• changings in investors’ perception of us and the investment environment generally;

• fluctuations in stock market price and volume;

• announcement made by us or our competitors;

• changes in pricing adopted by our competitors;

• political, economic, financial and social developments in China and Hong Kong and in the global economy; and

• involvement in material litigation.

–60– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS

The securities markets have from time to time experienced significant price and volume fluctuations that are not related or disproportionate to the operating performance of particular companies. These developments include a general global economic downturn, substantial volatility in equity securities markets, and volatility and tightening of liquidity in credit markets. While it is difficult to predict how long these conditions will last, they could continue to present risks for an extended period of time, in interest expenses on our bank borrowings, or reduction of the amount of banking facilities currently available to us. If we experience such fluctuations, results of operations and financial position could be materially and adversely affected. Moreover, market fluctuations may also materially and adversely affect the market price of our H Shares.

Future issues, offers or sales or the expectation of such issues, offers or sales of our Shares in the public market may adversely affect the price of our Shares.

Although our Controlling Shareholders are subject to restrictions on their sales of Shares within one year from the [REDACTED] as described in “[REDACTED]” in this document, future sales of a significant number of our Shares by our Controlling Shareholders or other existing shareholders in the public market after the [REDACTED], or the perception that these sales could occur, could cause the market price of our Shares to decline and could materially impair our future ability to raise capital through offerings of our Shares. We cannot assure you that our Controlling Shareholders, or other existing shareholders will not dispose of Shares held by them upon the expiration of restriction set out above or that we will not issue additional Shares. We are currently applying for all of the Company’s Domestic Shares to circulate on the Stock Exchange after the completion of the [REDACTED]. According to the PRC Company Law, all the Domestic Shares issued by the Company prior to the [REDACTED] (being 87,212,834 Domestic Shares in aggregate) are restricted from trading within one year from the [REDACTED]. Such restriction from trading will limit the number of H Shares to be circulated on the market, which will in turn adversely affect the liquidity of the H Shares during such restriction period. If our application for the circulation of our relevant Domestic Shares on the Stock Exchange after the completion of the [REDACTED] is successful, any future sales (after the expiration of the restrictions set out above) of Domestic Shares by relevant Shareholders in the public market may affect the market price of the Shares. Moreover, if we convert our Domestic Shares into H shares to be [REDACTED] and traded in the future at the Stock Exchange of Hong Kong, it may further increase the supply of the H shares in the market, which may affect the market price of the H shares. We cannot predict the effect, if any, that any future sales of Shares by our Controlling Shareholders or other existing Shareholders, or the Shares available for sale by our Controlling Shareholders or other existing Shareholders, or the issuance of Shares by the Company may have on the market price of the Shares. Sale or issuance of a substantial amount of Shares by our Controlling Shareholders or us, or the market perception that such sale or issuance may occur, could materially and adversely affect the prevailing market price of the Shares.

–61– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS

The market price of our [REDACTED] when trading begins could be lower than the [REDACTED] as a result of, among other things, adverse market conditions or other adverse developments that could occur between the time of sale and the time trading begins.

The final [REDACTED] will be determined on the [REDACTED]. However, the [REDACTED] will not commence trading on the Stock Exchange until they are delivered, which is expected to be several business days after the pricing date. As a result, investors may not be able to sell or otherwise [REDACTED] the [REDACTED] during that period. Factors such as variations in our revenue, net profit and cash flows and announcements of new investments and acquisitions, fluctuations in market prices for our services could cause the market price of our H Shares to change substantially. We cannot assure you that these developments will not occur in future. Accordingly, holders of the [REDACTED] are subject to the risk that the price of the [REDACTED] when trading begins could be lower than the [REDACTED] as a result of adverse market conditions or other adverse developments that may occur between the time of sale and the time trading begins.

We may not declare dividends on our [REDACTED] in the future.

Any declaration of dividends will be proposed and determined by our Board of Directors, and the amount of any dividends will depend on various factors, including but not limited to, our results of operations, cash flows and financial position, financial performance, profitability, business development, prospects, capital requirements, distributable profits as determined under PRC GAAP or HKFRS (whichever is lower), our Articles of Association and other constitutional documents, the PRC Company Law and any other applicable PRC laws and regulations, economic outlook and other factors that our Directors deem relevant. We cannot guarantee that dividends of any amount will be declared or distributed in any year. For further information, please refer to the section entitled “Financial Information—Dividends and Dividend Policy” in this document.

Our Controlling Shareholders has substantial control over our Company and its interests may not be aligned with the interests of the other Shareholders.

Prior to and immediately following the completion of the [REDACTED], our Controlling Shareholders will remain having substantial control over its interests in the issued share capital of our Company. Subject to the Articles of Association, the Companies Ordinance, the PRC Company Law, the Listing Rules and other applicable laws and regulations, our Controlling Shareholders by virtue of their controlling beneficial ownership of the share capital of our Company, will be able to exercise significant control and exert significant influence over our business or otherwise on matters of significance to us and other Shareholders by voting at the general meeting of our Shareholders and at Board meetings. Therefore, our Controlling Shareholders will have significant influence on the outcome of any corporate transaction or other matters submitted to our Shareholders for approval, including mergers, consolidations, sales of all or substantially all of our assets, election of Directors and other significant corporate actions. The interests of our Controlling Shareholders may differ from the interests of other Shareholders and our Shareholders are free to exercise their votes according to their interests. To the extent that the interests of our Controlling Shareholders conflict with the interests of other Shareholders, the interests of other Shareholders can be disadvantaged and harmed.

–62– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS

Our management has significant discretion as to how to use the net proceeds of the [REDACTED], and you may not necessarily agree with how we use them.

Our management may use the net proceeds from the [REDACTED] in ways that you may not agree with or that do not yield a favorable return to our Shareholders. By investing in our Shares, you are entrusting your funds to our management, upon whose judgment you must depend, for the specific uses we will make of the net proceeds from this [REDACTED]. For more information, see “Future Plans and Use of Proceeds” in this document.

Investors may experience difficulties in enforcing their Shareholder rights because we are incorporated in the PRC, and the protection afforded to minority Shareholders under the PRC law may be different from that under the laws of Hong Kong or other jurisdictions.

Our Company is incorporated in the PRC and its affairs are governed by our Articles of Association, the PRC Company Law, the Special Regulations and the Mandatory Provisions. The laws of the PRC may differ from those of Hong Kong or those of other jurisdictions where investors may be located. As a result, minority Shareholders may not enjoy the same rights as those afforded under the laws of Hong Kong or in other jurisdictions. See “Summary of Principal PRC and Hong Kong Legal and Regulatory Provisions—Summary of Material Differences Between Hong Kong and PRC Company Law—Protection of Minorities” in Appendix V to this document for a summary of the PRC Company Law on protection of minority shareholders.

The accuracy of certain facts and other statistics with respect to China, the PRC economy and our relevant industries in this document which are derived from various official government sources and third-party sources cannot be guaranteed.

Certain facts and other statistics in this document relating to China, the PRC economy and the industries relevant to us have been derived from various official government publications, from CIA and publicly available sources. However, we cannot guarantee the quality or reliability of these sources. They have not been prepared or independently verified by us or any of our affiliates or advisors and, therefore, we make no representation as to the accuracy of such facts and statistics. Due to possibly flawed or ineffective collection methods or discrepancies between published information and market practice and other problems, the facts and statistics herein may be inaccurate or may not be comparable to facts and statistics produced for other economies. As a result, prospective investors should consider carefully how much weight or importance they should attach to or place on such facts or statistics.

–63– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. RISK FACTORS

Investors should read the entire document carefully and should not consider any particular statements in published media reports without carefully considering the risks and other information contained in this document.

There may be coverage in the media regarding us, the [REDACTED] and our operations. There had been, prior to the publication of this document, and there may be, subsequent to the date of this document but prior to the completion of the [REDACTED], press and media coverage regarding us and the [REDACTED], which contained, among other matters, certain financial information, projections, valuations and other forward-looking information about us and the [REDACTED]. We do not accept any responsibility for the accuracy or completeness of the information and make no representation as to the appropriateness, accuracy, completeness or reliability of any information disseminated in the media. To the extent that any of the information in the media is inconsistent or conflicts with the information contained in this document, we disclaim it. Accordingly, prospective investors should read the entire document carefully and should not rely on any of the information in press articles or other media coverage. Prospective investors should only rely on the information contained in this document to make investment decisions about us.

Forward-looking information in this document is subject to risks and uncertainties.

This document contains forward-looking statements and information relating to us and our operations and prospects that are based on our current beliefs and assumptions as well as information currently available to us. When used in this document, the words “anticipate,” “believe,” “estimate,” “expect,” “plans,” “prospects,” “going forward,” “intend”, “aim”, “will”, “may”, “consider”, “should”, “could”, “would”, “continue” and similar expressions, as they relate to us or our business, are intended to identify forward-looking statements. Such statements reflect our current views withrespect to future events and are subject to risks, uncertainties and various assumptions, including the risk factors described in this document. Should one or more of these risks or uncertainties materialize, or if any of the underlying assumptions prove incorrect, actual results may diverge significantly from the forward-looking statements in this document. Whether actual results will conform with our expectations and predictions is subject to a number of risks and uncertainties, many of which are beyond our control, and reflect future business decisions that are subject to change. In light of these and other uncertainties, the inclusion of forward-looking statements in this document should not be regarded as representations that our plans or objectives will be achieved, and investors should not place undue reliance on such forward-looking statements. All forward- looking statements contained in this document are qualified by reference to the cautionary statements set out in this section. We do not intend to update these forward-looking statements in addition to our on-going disclosure obligations pursuant to the Listing Rules or other requirements of the Stock Exchange.

–64– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. WAIVERS FROM STRICT COMPLIANCE WITH THE REQUIREMENTS UNDER THE LISTING RULES

In preparation for the [REDACTED], we have sought the following waivers and exemption from strict compliance with the relevant provisions of the Listing Rules:

MANAGEMENT PRESENCE IN HONG KONG

According to Rule 8.12 and Rule 19A.15 of the Listing Rules, an issuer must have a sufficient management presence in Hong Kong and in normal circumstances, at least two of the issuer’s executive directors must be ordinarily resident in Hong Kong. Currently, all of our executive Directors reside in the PRC.

Since our headquarters and substantially core business are based and conducted in the PRC, it would be practically difficult and commercially unnecessary for us to relocate two of our executive Directors to Hong Kong. We have applied to the Stock Exchange for and the Stock Exchange [has granted] a waiver from strict compliance with Rule 8.12 and Rule 19A.15 of the Listing Rules. The following measures have been adopted by us:

(1) we have appointed two authorized representatives pursuant to Rule 3.05 of the Listing Rules, who will act as our principal channel of communication with the Stock Exchange and ensure that our Group complies with the Listing Rules at all times. The two authorized representatives appointed are Mr. Lv Yuhua (呂雨華) (an executive Director and deputy general manager of our Company) and Ms. Chan Yin Wah (陳燕華) (the joint company secretary of our Company). Ms. Chan Yin Wah is ordinarily resident in Hong Kong. Each of the authorized representatives will be available to meet with the Stock Exchange in Hong Kong within a reasonable time frame upon the request of the Stock Exchange and will be readily contactable by telephone, facsimile and email. Each of the authorized representatives is authorized to communicate on our behalf with the Stock Exchange;

(2) both of our authorized representatives have means to contact all of our Directors (including the independent non-executive Directors) promptly at all times as and when the Stock Exchange wishes to contact the Directors for any matters. Directors who are not ordinarily resident in Hong Kong possess or can apply for valid travel documents to visit Hong Kong and will be able to meet with the Stock Exchange within a reasonable period of time, when required. To enhance communication among the Stock Exchange, the authorized representatives and our Directors, our Company will implement a policy that (a) each of the Directors has provided their respective mobile phone number, office phone number, fax number and email address to the authorized representatives; (b) in the event that a Director expects to travel or is otherwise out of office, he/she will provide the phone number of the place of his/her accommodation to the authorized representatives or maintain an open line of communication via his/her mobile phone; and (c) each of our Directors and the authorized representatives has provided their respective mobile phone numbers, office phone numbers, fax numbers and email addresses to the Stock Exchange;

–65– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. WAIVERS FROM STRICT COMPLIANCE WITH THE REQUIREMENTS UNDER THE LISTING RULES

(3) in compliance with Rules 3A.19 and 19A.05 of the Listing Rules, we have appointed Maxa Capital Limited as our compliance advisor (the “Compliance Advisor”), which has access at all times to our authorized representatives, Directors, Supervisors, senior management and other officers of our Company, and will act as an additional channel of communication with the Stock Exchange. Our Company will keep the Stock Exchange up to date in respect of any change to such details. The authorized representatives, Directors, Supervisors, senior management and other officers of our Company will provide promptly such information and assistance as the Compliance Advisor may reasonably require in connection with the performance of the Compliance Advisor’s duties as set forth in Chapter 3A and Rule 19A.06 of the Listing Rules. There will be adequate and efficient means of communication between our Company, the authorized representatives, the Directors and other officers and the Compliance Advisor, and to the extent reasonably practicable and legally permissible, our Company will keep the Compliance Advisor informed of all communications and dealings between our Company and the Stock Exchange; and

(4) meetings between the Stock Exchange and our Directors could be arranged through our authorized representatives or the Compliance Advisor, or directly with our Directors within a reasonable time frame. We will inform the Stock Exchange as soon as practicable in respect of any change of our authorized representatives and/or the Compliance Advisor.

JOINT COMPANY SECRETARIES

According to Rules 3.28 and 8.17 of the Listing Rules and the Guidance on experience and qualification requirements of a company secretary (HKEX-GL108-20), the secretary of an issuer must be a person who has the requisite knowledge and experience to discharge the functions of the company secretary and is either (i) a member of the Hong Kong Institute of Chartered Secretaries, a solicitor or barrister as defined in the Legal Practitioners Ordinance or a certified public accountant as defined in the Professional Accountants Ordinance, or (ii) an individual who, by virtue of his academic or professional qualifications or relevant experience, is, in the opinion of the Stock Exchange, capable of discharging the functions of a company secretary. According to the Guidance Letter HKEX-GL108-20, the waiver under Rules 3.28 of the Listing Rules will be granted for a fixed period of time, but in any case, will not exceed three years from the [REDACTED] (the “Waiver Period”) and on the conditions that (i) the company secretary in question must be assisted by a person who possesses the qualifications or experience as required under Rule 3.28 and is appointed as a joint company secretary throughout the Waiver Period; and (ii) the waiver can be revoked if there are material breaches of the Listing Rules by the Company.

–66– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. WAIVERS FROM STRICT COMPLIANCE WITH THE REQUIREMENTS UNDER THE LISTING RULES

We have appointed Mr. Fan Zhiwei (范治威) and Ms. Chan Yin Wah (陳燕華)asour joint company secretaries. Mr. Fan joined our Company in March 2002 and currently serves as a deputy general manager and the chief financial officer of our Company. He is primarily responsible for financial management, financing management and implementation of matters related to Board and shareholders’ meetings of our Company. Given Mr. Fan has over 19 years of accounting and finance experience and currently serves as the secretary of our Board, our Directors are of the view that, with Mr. Fan’s thorough understanding of the overall operations and corporate governance matters of our Group, he is considered as a suitable person to act as a company secretary of our Company. In addition, as our core business and operations are substantially based and conducted in the PRC, our Directors believe that it is necessary to appoint Mr. Fan as a company secretary whose presence in the headquarter of our Group enables him to attend to the day-to-day corporate secretarial matters concerning our Group. However, given Mr. Fan does not possess a qualification stipulated in Rule 3.28 of the Listing Rules, he is not able to solely fulfill the requirements as a company secretary of a listed issuer stipulated under Rules 3.28 and 8.17 of the Listing Rules.

Accordingly, we have applied to the Stock Exchange for, and the Stock Exchange [has granted], a waiver from strict compliance with the requirements under Rules 3.28 and 8.17 of the Listing Rules in relation to the appointment of Mr. Fan Zhiwei on the condition that Mr. Fan will be assisted by Ms. Chan Yin Wah who possesses the qualifications or experience as required under Rule 3.28 throughout the Waiver Period. In order to provide support to Mr. Fan, we have appointed Ms. Chan Yin Wah, a fellow member of The Hong Kong Institute of Chartered Secretaries and The Chartered Governance Institute in the United Kingdom, who possessed the qualifications and experience as required under Rule 3.28 and 8.17 of the Listing Rules, as a joint company secretary to provide assistance to Mr. Fan, for the Waiver Period so as to enable Mr. Fan to acquire the relevant experience (as required under Rule 3.28(2) of the Listing Rules) to duly discharge his duties.

Such waiver will be revoked immediately if and when Ms. Chan Yin Wah ceases to provide such assistance or if there are material breaches of the Listing Rules by our Company. We will liaise with the Stock Exchange before the end of the three-year period to enable it to assess whether Mr. Fan Zhiwei, having had the benefit of Ms. Chan’s assistance for three years, will have acquired relevant experience within the meaning of Rule 3.28 of the Listing Rules so that a further waiver will not be necessary.

See “Directors, Supervisors and Senior Management” for the biographical information of Mr. Fan Zhiwei and Ms. Chan Yin Wah.

–67– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. INFORMATION ABOUT THIS DOCUMENT AND THE [REDACTED]

[REDACTED]

–68– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. INFORMATION ABOUT THIS DOCUMENT AND THE [REDACTED]

[REDACTED]

–69– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. INFORMATION ABOUT THIS DOCUMENT AND THE [REDACTED]

[REDACTED]

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[REDACTED]

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[REDACTED]

–72– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. INFORMATION ABOUT THIS DOCUMENT AND THE [REDACTED]

[REDACTED]

–73– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. INFORMATION ABOUT THIS DOCUMENT AND THE [REDACTED]

[REDACTED]

–74– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE [REDACTED]

DIRECTORS

Name Residential Address Nationality

Executive Directors

Mr. Chen Yaozhong Room I, 20/F Chinese (陳耀忠) Ziyu Garden Fuzhong Road, Futian District Shenzhen, Guangdong PRC

Mr. Liang Zhijun Room F, 21/F, Tower 3 (Phase 1) Chinese (梁志軍) Zhenye Luanshangu 81 Baohe Avenue, Longhua District Shenzhen, Guangdong PRC

Mr. Lv Yuhua Room 203, Tower 2 Chinese (呂雨華) Fuli Garden Central Shennan Road, Futian District Shenzhen, Guangdong PRC

Mr. Yin Shanfeng Room 805, Tower 1 Chinese (尹善峰) Champs-Elysees Garden Futian District Shenzhen, Guangdong PRC

Non-executive Directors

Mr. Ma Xingwen Room 48A, Tower 1 Chinese (馬興文) No. 9 Courtyard, Xiangmihu Futian District, Shenzhen, Guangdong PRC

Mr. Ning Zhu No. 302 Chinese (寧柱) Lane 418 Jinxiu East Road Pudong New Area Shanghai, PRC

–75– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE [REDACTED]

Name Residential Address Nationality

Independent non-executive Directors

Mr. Cao Yang Room 0102, Tower 17 Chinese (曹陽) Xinyuan Phase II Minzhi Avenue, Longhua District Shenzhen, Guangdong PRC

Mr. Wu Yajun Room 1-602, Tower 13 Chinese (武亞軍) Area 3, Xiaojiahe Faculty Residence Peking University Haidian District Beijing, PRC

Ms. Xin Zhu (辛珠) Flat A, 15/F, Tower 2 Chinese The Harbourside 1 Austin Rd, West Kowloon Hong Kong

SUPERVISORS

Name Residential Address Nationality

Mr. Zhang Zhi Room 32A1,Block A Chinese (張志) Tower 7, Jinxiu Yuyuan Garden (Phase 3), Longhua District Shenzhen, Guangdong PRC

Mr. Liang Xiaobin Room 1302, Block 2 Chinese (梁曉斌) Tower 1, Jindi Yijing Fenggang Town Dongguan, Guangdong PRC

Mr. Wang Junling 10L Sangdayayuan Chinese (王俊嶺) North Huafa Road Futian District Shenzhen, Guangdong PRC

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Name Residential Address Nationality

Mr. Xin Zhiqiang Room 1201, Block B Chinese (辛智強) Tower 1, MGM Mansion Luneng Diaoyutai Fengtai District Beijing, PRC

Mr. Yu Songdong Room 1607, Block A Chinese (余頌東) Tower 4, Changcheng Building Futian District Shenzhen, Guangdong PRC

For further information regarding our Directors and Supervisors, please see “Directors, Supervisors and Senior Management” of this document.

OTHER PARTIES INVOLVED IN THE [REDACTED]

Joint Sponsors Huatai Financial Holdings (Hong Kong) Limited 62/F The Center 99 Queen’s Road Central Hong Kong

Ping An of China Capital (Hong Kong) Company Limited Units 3601, 07 & 11-13, 36/F The Center 99 Queen’s Road Central Hong Kong

[REDACTED] [REDACTED]

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[REDACTED] [REDACTED]

Legal advisors to our Company as to Hong Kong law: Sidley Austin 39/F, Two International Finance Centre 8 Finance Street Central Hong Kong

as to PRC laws: Global Law Office 27/F Tower B China Resources Land Building No.9668 Shennan Avenue Nanshan District Shenzhen PRC

Legal advisors to as to Hong Kong law: the Joint Sponsors and Norton Rose Fulbright Hong Kong [REDACTED] 38/F Jardine House 1 Connaught Place Central Hong Kong

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as to PRC laws: Zhong Lun Law Firm 8-10/F, Tower A Rongchao Tower 6003 Yitian Road Futian District Shenzhen, Guangdong PRC

Auditor and reporting PricewaterhouseCoopers accountant Certified Public Accountants Registered Public Interest Enitity Auditor 22/F, Prince’s Building Central Hong Kong

Independent Property Valuer Jones Lang LaSalle Corporate Appraisal and Advisory Limited 7th Floor, One Taikoo Place 979 King’s Road Hong Kong

Compliance advisor Maxa Capital Limited Unit 1908 Harbour Center 25 Harbour Road Wanchai Hong Kong

Industry consultant China Index Academy 20th Floor B MOI Time Square Hyde Road Culture Center Nanshan District Shenzhen PRC

[REDACTED] [REDACTED]

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Headquarters in the PRC 9/F and 10/F, Tower C2 Bantian International Center 5 Huancheng South Road Bantian Street Longgang District Shenzhen, Guangdong PRC

Registered office in the PRC 9/F and 10/F Tower C2 Bantian International Center 5 Huancheng South Road Bantian Street Longgang District Shenzhen, Guangdong PRC

Principal place of business in 40th Floor Hong Kong Dah Sing Financial Centre 248 Queen’s Road East Wanchai, Hong Kong

Company’s website address http://www.cc-pg.cn (This website and the information contained on this website does not form part of this document)

Joint company secretaries Mr. Fan Zhiwei (范治威) Room H, 32/F Huboge, Lakeview Garden Honghu Road Luohu District Shenzhen, Guangdong PRC

Ms. Chan Yin Wah (陳燕華) (A fellow member of the Hong Kong Institute of Chartered Secretaries) 40th Floor Dah Sing Financial Centre 248 Queen’s Road East Wanchai, Hong Kong

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Authorized representatives Mr. Lv Yuhua (呂雨華) 203 Tower 2 Fuli Garden Zhenhua West Road Futian District Shenzhen, Guangdong PRC

Ms. Chan Yin Wah (陳燕華) 40th Floor Dah Sing Financial Centre 248 Queen’s Road East Wanchai, Hong Kong

Audit committee Ms. Xin Zhu (辛珠) (chairman) Mr. Wu Yajun (武亞軍) Mr. Ma Xingwen (馬興文)

Remuneration committee Mr. Cao Yang (曹陽) (chairman) Mr. Chen Yaozhong (陳耀忠) Mr. Wu Yajun (武亞軍)

Nomination committee Mr. Chen Yaozhong (陳耀忠) (chairman) Mr. Cao Yang (曹陽) Mr. Wu Yajun (武亞軍)

H Share Registrar [REDACTED]

Principal banks China Merchants Bank Co., Ltd. Shenzhen Branch China Merchants Bank Shenzhen Branch Tower 2016 Shennan Road Central Futian District, Shenzhen Guangdong, PRC

Industrial and Commercial Bank of China Limited Shenzhen Municipal Branch 1 Jintang Street, Shennan East Road Luohu District, Shenzhen Guangdong, PRC

Bank of China Limited Shenzhen Branch International Finance Building 2022 Jianshe Road Luohu District, Shenzhen Guangdong, PRC

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The information in this section is derived from an independent report prepared by CIA. The industry report prepared by CIA is based on information from its database, publicly available sources, industry reports, data obtained from interviews and other sources. We believe that the sources of the information in this section are appropriate sources for such information and have taken reasonable care in extracting and reproducing such information. We have no reason to believe that such information is false or misleading or that any part has been omitted that would render such information false or misleading. The information has not been independently verified by us, the Joint Sponsors, the [REDACTED], the [REDACTED],the[REDACTED], the [REDACTED], any of its directors, officers, affiliates, advisors or representatives, or any other party (other than CIA) involved in the [REDACTED]. We, the Joint Sponsors, the [REDACTED], the [REDACTED], any of its directors, officers, affiliates, advisors or representatives, and any other party (other than CIA) involved in the [REDACTED] make no representation as to the completeness, accuracy or fairness of such information and accordingly such information should not be unduly relied upon.

CIA AND ITS METHODOLOGIES

We purchased the right to use and quote various data from publications of CIA at a total cost of RMB800,000. CIA is an independent research institute who has extensive experiences researching and tracking the PRC property management industry, and has conducted research on the top 100 property management companies in the PRC, or Top 100 Property Management Companies since 2008. In conducting its research, CIA primarily evaluates property management companies that have managed at least ten properties or have an aggregate GFA of 500,000 sq.m. or more in the previous three years. CIA uses research parameters and assumptions and gathers data from multiple primary and secondary sources, including (i) published statistics, websites and marketing materials of property management companies; (ii) surveys and data from the China Real Estate Index System and the China Real Estate Statistics Yearbooks; (iii) public data from governmental authorities; and (iv) data gathered previously for the property management companies. In addition, since 2008, CIA has published the ranking of China’s Top 100 Property Management Companies in terms of overall strength, primarily by evaluating data from the previous year in relation to management scale, operational performance, service quality, growth potential and social responsibility of the property management companies under consideration. In determining such rankings, CIA may assign the same ranking to multiple companies with the same or very close scores, and therefore it is possible that more than 100 companies may be classified as being among the Top 100 Property Management Companies in the industry. CIA may, upon specific request, prepare further rankings within the Top 100 Property Management Companies for certain indices. CIA also assesses the growth potential of property management companies primarily in terms of growth rate of revenue, growth rate of total GFA under management, contracted but undelivered GFA, the total number of employees and employee composition. Data analysis in this section includes data and information on the Top 100 Property Management Companies as ranked by CIA. We requested CIA to assess us for the Top 100 Property Management Companies based on compound annual growth rates (“CAGRs,” or each a “CGAR”) for GFA under management, number of properties under management and revenue from 2015 to 2020 for the purpose of the [REDACTED].

In preparing the CIA Report, CIA assumed that: (i) the social, economic and political conditions in China and the world will remain stable during the forecast period; (ii) government policies on the property management industry in China will remain unchanged during the forecast period; (iii) all published data by the relevant statistics bureaus are accurate; and (iv) all collected information relating to residential sales transactions from the relevant local housing administrative bureaus are accurate.

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THE PROPERTY MANAGEMENT INDUSTRY IN THE PRC

Overview

The PRC property management industry is intensely competitive and highly fragmented. The history of the PRC property management industry could be traced back to the early 1980s with the establishment of the first property management company in Shenzhen, Guangdong province. Since then, the PRC Government has sought to construct and update a regulatory framework for the PRC property management industry in parallel with its growth. The PRC Government promulgated an increasing number of regulations over the years, with the aim to establish an open market system for the property management industry that served to promote its rapid growth and standardized operation. PRC property management companies now provide services in relation to a wide range of properties including residential properties, commercial properties, office buildings, public properties, industrial parks, schools and hospitals, among others.

With the adoption of advance technologies, such as cloud application, e-commerce, Internet of Things, big data and artificial intelligence, the property management companies are gradually replacing labor with smart management systems in business operations. The PRC Government has also promulgated a series of favorable policies supporting the development and modernization of property management industry. In addition, property management companies have gained wider access to the capital market for equity and/or debt financing in recent years, following the listings of property management companies. Driven by the technology development, governmental support and capital market activities, the property management industry is expected to maintain rapid growth.

Major Revenue Models in the PRC Property Management Industry

In the PRC, property management companies generate revenue from property management services. In addition, property management companies may also generate revenue from other value-added services, including, among others, consultancy services, engineering services and community value-added services such as common area operation, housekeeping and cleaning, property agency, elderly care and nursing services.

In the PRC, property management fees may be charged either on a lump sum basis or a commission basis. The lump-sum fee model for property management fees is the dominant fee model in the property management industry in China, especially for residential properties. The lump-sum fee model can bring efficiency by dispensing certain collective decision-making procedures for large expenditures by property owners and residents and incentivizing property management service providers to optimize their operations to enhance profitability. In contrast, the commission model is increasingly adopted for non-residential properties, allowing property owners to become more involved in their property management and service providers to be more closely supervised.

Overview of the Development of Property Management Industry in the PRC

In recent years, following rapid urbanization and continuous growth in per capita disposable income, the GFA and number of properties managed by the Top 100 Property Management Companies have increased rapidly. The average total GFA under management by the Top 100 Property Management Companies increased from approximately 23.6 million sq.m. in 2015 to approximately 48.8 million sq.m. in 2020, representing a CAGR of approximately 15.6%. The average number of properties managed by the Top 100 Property Management Companies increased from 154 as of December 31,

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2015 to 244 as of December 31, 2020, representing a CAGR of approximately 9.6%. The following chart sets forth the rise in average total GFA under management and average number of properties for the Top 100 Property Management Companies in the years indicated:

Average Total GFA under Management and Average Number of Properties for the Top 100 Property Management Companies, 2015-2020

48.8 50.0 50.0% 45.0 42.8 49.7% 37.2 40.0 43.6% 40.0% 35.0 31.6 38.9% 27.3 30.0 32.4% 244 30.0% 23.6 29.4% 25.0 28.4% 212 178 192 20.0 154 166 20.0% 15.0 10.0 10.0% 5.0 0.0 0.0% 2015 2016 2017 2018 2019 2020

Average total GFA under management Average number of properties Market share Unit: million sq.m

Source: CIA

As a result of the growth in GFA and number of properties under management, the average revenue of the Top 100 Property Management Companies increased from approximately RMB540.8 million in 2015 to approximately RMB1,173.4 million in 2020, representing a CAGR of approximately 16.8%. According to CIA, the Top 100 Property Management Companies have expanded their presence in the PRC — the average number of cities in which the Top 100 Property Management Companies had operations increased from 27 as of December 31, 2015 to 34 as of December 31, 2020. The following chart sets forth the rise in total revenue of the Top 100 Property Management Companies in the years indicated.

Total Revenue of the Top 100 Property Management Companies, 2015-2020

7,000 Unit in RMB100 million 60% 6,232.0 5,687.0 6,000 49.7% 50% 4,912.8 5,000 4,529.9 44.6% 4,249.3 3,983.2 39.7% 40% 4,000 32.8% 3,097.8 28.5% 29.6% 30% 3,000 2,538.0 1,949.6 20% 2,000 1,484.2 1,135.6 1,255.7 1,000 10%

0 0% 2015 2016 2017 2018 2019 2020

Revenue of Property Management Industry Total revenue of Top 100 Property Management Companies Market share of Top 100 Property Management Companies

Source: CIA

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Industry Growth Drivers

The growth of China’s property management industry depends on various key drivers.

Favorable Policies for the Property Management Industry

In June 2003, the PRC Government promulgated the Regulations on Property Management《物業管理條例》 ( ), establishing a regulatory framework for the property management industry in China. Since then, a number of laws and rules have come into effect regulating various aspects of the property management industry and numerous policies enacted to promote its development. These include, but are not limited to, the Circular of the NDRC on the Opinions of Relaxing Price Controls in Certain Services《國家發展和改革委關於放開部分服務價格意見的通知》 ( ), the Guidance on Accelerating the Development of the Resident Service Industry to Promote the Upgrading of Consumption Structure《關於加快發展生活性服務業促進消費結構升級的指導意見》 ( ) and the Announcement on Preferential Taxation for the Elderly Care, Child Care, Housekeeping and Other Community Living Services《關於養老、托育、家政等社區家庭 ( 服務業稅費優惠政策的公告》). Furthermore, various provincial and municipal governments have issued their own laws and rules to construct the regulatory frameworks for the local property management industries. We expect that the PRC property management industry will continue to grow on a national scale through government encouragement under the various regulatory frameworks.

The favorable policies also encourage the development of smart communities. In May 2014, the Ministry of Housing and Urban-rural Development issued Guidance on Smart Community Construction (Trial)《智慧社區建設指南 ( （試行）》), which recommended the modernization of community management by integrating modern technologies, public resources and commercial services into the management process. We believe that such policies will jointly create a supportive and orderly environment for the development of the property management industry and property management companies. Please see “Regulatory Overview” for more information on laws and regulations related to the property management industry.

On January 5, 2021, relevant national departments and ministries including the Ministry of Housing and Urban-Rural Development jointly issued the “Notice on Strengthening and Improving Residential Property Management”《關於加強和改進住宅 ( 物業管理工作的通知》) with an aim to improve the quality and efficiency of residential property management from six aspects, which comprise integrating into the grassroots social governance system, improving the governance structure of the property owner’s association, improving the property management services quality, promoting the development of the living service business, standardizing the use and management of the maintenance funds and strengthening the supervision and management of property services.

The PRC Government have formulated and implemented a number of policies intended to further support and promote the growth of the property management industry. The policies have set forth a regulatory framework under which the property management companies are encouraged to, among others, expand their services to keep up with the evolving needs of customers by staying technologically innovative through investment and development in Internet of Things platforms and technology-related services, and continue to broaden the business scope of traditional property management services to improve the living standards of customers. In response to the policies, property management companies are strategically expanding and diversifying the value-added services to non-property developers and community.

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Growth in Demand

China’s economy has experienced steady growth from 2015 to 2020, demonstrated by the increase of nominal GDP from RMB68,888 billion in 2015 to RMB101,599 billion in 2020, representing a CAGR of 8.1% in nominal term. During the same period, per capita disposable income of urban residents in China increased from RMB31,195 in 2015 to RMB43,834 in 2020, representing a CAGR of 7.0%, which indicates a significant increase of purchasing power of urban residents in China that has, in turn, led to a growing demand for property upgrades. China’s urbanization rate continue to rise with support of favorable policies such as the New National Urbanization Plan (2014-2020)《國家新型城 ( 鎮化規劃(2014-2020)》).

In line with steady growth of macro-economy and per capita disposable income of urban residents, the PRC real estate industry maintained stable growth. The overall investment in real estate industry increased from RMB9,597.9 billion in 2015 to RMB14,144.3 billion in 2020, representing a CAGR of 8.1%. The total properties sold increased from RMB8,728.1 billion in 2015 to RMB17,361.3 billion in 2020, representing a CAGR of 14.7%.

Further, the urbanization rate (being the projected average rate of the size of the urban population over the given period of time) in China increased to 60.6% as of December 31, 2019. The growing urbanization rate produces a high demand for property management service and the PRC property management industry is expected to continue to grow in tandem with a rising level of urbanization of the country. We expect that, backed with increasing per capita disposable income, consumers will be increasingly sophisticated and willing to pay premiums for quality services and have more discretion on spending in goods and services beyond basic necessity.

According to CIA, China’s significant growth in urbanization and per capita disposable income has been the principal driver for the growth of the property management industry. Chinese consumers increasingly demand better living conditions and quality property management services, which is another underlying reason for the growth of the PRC property management industry. In addition, we believe the emerging middle-to high-income class in the PRC and their growing spending power will have a significant influence on the development of mid-to high-end property management services in the PRC through their demand for more quality products and services.

Driven by customer demand and intense competition, property management companies have invested to improve their service quality and paid more attention to their customers’ demands. The Top 100 Property Management Companies have responded to this trend by, among other steps, optimizing their traditional property management services and upgrading the quality of their services by applying technological solutions. According to CIA, property management companies with enhanced service quality can charge higher service fees.

Growth in Supply

Following rapid urbanization and continuous growth in per capita disposable income, the supply of commodity properties also surged. The total GFA of commodity properties sold increased from approximately 1,284.9 million sq.m. in 2015 to approximately 1,760.9 million sq.m. in 2020, representing a CAGR of 6.5%.

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Further Development of Capital Markets

The development of capital markets continues to intensify. A number of property management companies participate in capital markets to expand their financing channels. According to CIA, as of March 31, 2021, there were 40 property management companies listed on the Stock Exchange, one property management company listed on the Shanghai Stock Exchange (上海證券交易所上市), three property management companies listed on the SZSE (深圳證券交易所上市); further, as of December 31, 2020, 35 property management companies listed on the National Equities Exchange and Quotations (全國中小企業股份轉讓系統). By doing so, such listed property management companies are able to increase investment in technology innovation, build up intelligent platforms, strengthen the cooperation with other property management companies, improve service quality and increase operational efficiency. In addition, diversified capital sources enable the property management companies to accelerate selective and strategic mergers and acquisitions, and to further expand the scale of business.

TRENDS IN THE PRC PROPERTY MANAGEMENT INDUSTRY

Increased Market Concentration

After decades of development, some of the Top 100 Property Management Companies have accelerated their service innovation and business expansion. In addition, the market continues to become more concentrated, and the players in the PRC property management industry are facing increasingly intense market competition. In the competitive PRC property management industry, large-scale property management companies actively improve their strategic layout and accelerate their expansion in order to increase their respective market shares and achieve better results of operations. Their organic growth, as well as mergers and acquisitions, may expose property management companies to challenges arising from the difficulties in integrating acquired operations with existing businesses. The total GFA under management by the Top 100 Property Management Companies increased from approximately 5.0 billion sq.m. in 2015 to approximately 12.9 billion sq.m. in 2020, representing a CAGR of approximately 21.0%. The aggregate market share of the Top 100 Property Management Companies increased from 28.4% in 2015 to 49.7% in 2020. The aggregate market share of the Top 10 Property Management Companies increased from 7.6% in 2015 to 10.6% in 2020. The chart below sets forth the total GFA under management by property management companies in China, the total GFA managed by the Top 100 Property Management Companies and the aggregate market share of the Top 100 Property Management Companies and the total GFA under management in the years indicated:

Total GFA under Management and Market Share of the Top 100 Property Management Companies, Total GFA under Management, 2015-2020

49.7% 300.0 50.0% 43.6% 259.1 45.0% 38.9% 250.0 239.4 40.0% 32.4% 210.6 35.0% 200.0 28.4% 29.4% 195.2 30.0% 185.1 150.0 174.5 128.8 25.0% 104.4 20.0% 100.0 81.8 63.3 15.0% 49.6 54.5 50.0 10.0% 5.0% 0.0 0.0% 2015 2016 2017 2018 2019 2020

Total GFA managed by the Top 100 Property Management Companies (in hundred million sq.m.) Total GFA under management (in hundred million sq.m.) Market share of Top 100 Property Management Companies

Source: CIA

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Increasing Adoption of Information Technology in Business and Diversified Services

Many property management companies have developed diversified business, reduced labor costs and enhanced profitability by leveraging information technologies such as cloud applications, e-commerce, Internet of Things, big data and artificial intelligence. For example, artificial intelligence technologies such as smart entrance pass, smart building management, smart energy management, patrol robots, delivery robots and consultancy robots largely reduced the labor costs of property management companies. In addition, by adopting new technologies and using e-service platforms, property management companies could effectively integrate and allocate resources to provide more diversified community value-added services and further expand their services to common space management, community finance, property agency and housekeeping. As a result, the revenue generated from value-added services increasingly becomes an important source of revenue for property management companies. Moreover, to better control costs and maintain competitiveness, property management companies need to standardize and automate their operations to improve capacity and service quality and to meet diversified customer demands.

Increasing Demand for and Shortage of Professional Staff

With the rapid technology developments, the property management companies need to recruit and retain more qualified professional talents with management and technological skills. Property management companies also increasingly outsource labor-intensive aspects of their operations such as cleaning, landscaping and security to subcontractors while placing greater emphasis on recruiting and training professional and skilled employees to facilitate the implementation of smart management and information technologies, promote innovations to maintain their leading market positions and improve the level of property owner’s satisfaction.

The property management industry also faces challenges such as difficulty with recruiting competent professional staff, while at the same time property management industry lacks well trained staff to provide quality services and expand business development. Should the property management companies fail to recruit competent professional staff, the business development of property management companies may be adversely affected.

Increasing Standardization of Services

Standardization allows property management companies to improve their service quality, and is the foundation for the sustainable expansion of business operations across regions. The PRC Government has issued Guidelines for Accelerating the Development of Consumer Services and Promoting the Upgrading of Consumption Structure (關於加快發展生活性服務業促進消費結構升級的指導意見). According to CIA, such policy is to introduce the idea of standardizing the quality of property management services. Many of the Top 100 Property Management Companies in China have established internal standardized operating procedures to guide their provision of services. Information technology has played an increasingly important role in property management services in recent years. Property management companies use information technology to implement technological solutions for automating key business operations. Technological solutions minimize human error and allow property management companies to consistently apply their standardized procedures and quality standards. In turn, this reduces their reliance on manual labor and therefore the costs involved in hiring employees and subcontractors as well. Furthermore, centralized information technology enables property management companies to monitor the administrative and financial business operations of their branches, subsidiaries and offices, as well as ensure that they are consistently applying their policies, procedures and quality standards.

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Increasing Cooperation with Independent Property Developers

Traditionally, property management companies are better able to expand their business and market coverage through undertaking contracts for properties developed by large property developers if they are affiliated with such property developers. In recent years, as the market competition in the property management industry intensifies and the fees charged by the property management companies increase in accordance with trends prevailing in the relevant markets, property management companies need to compete for projects developed by independent property developers.

Increasing Transparency and Openness

With the promulgation of various government policies at central and local levels, the property management industry is becoming increasingly transparent. As a result, a growing number of properties are adopting the commission basis for property management fees due to the transparency and openness of management accounts under such a fee model.

HISTORICAL PRICE TRENDS OF LABOR AND SUBCONTRACTING COSTS

Property management companies constantly balance ever-rising labor costs with the necessity of providing quality services. A property management business relies on the availability of cheap and abundant manual labor. However, according to CIA, inflation has led to increased wages and other related labor costs (training costs) in recent years. Such change places additional pressure on property management companies seeking to expand their workforce to support business operations and their profit growth.

According to CIA, property management companies may reduce their overall cost of sales by adopting technological solutions and selectively increasing the proportion of services performed by subcontractors. Property management companies are able to reduce the reliance on the manual labor and improve work efficiency by performing intelligent transformation of equipment, such as intelligent access control systems and parking management systems. In recent years, the Top 100 Property Management Companies have actively experimented with and employed technological solutions to automate their business operations. By doing so, the Top 100 Property Management Companies are able to increase operational efficiency and raise service quality. According to CIA, subcontracting allows property management companies to reduce overall labor costs as well as leveraging the expertise of subcontractors in their respective fields to enhance service quality.

According to CIA, both the labor and subcontracting costs of Top 100 Property Management Companies increased in both absolute amount and percentage of cost of sales from 2017 to 2020. The average cost of sales of Top 100 Property Management Companies is approximately RMB576.5 million, RMB677.4 million, RMB790.3 million and RMB885.7 million in 2017, 2018, 2019 and 2020, respectively. The average labor cost to cost of sales ratio of Top 100 Property Management Companies is 55.8%, 57.8%, 59.1% and 58.3% in 2017, 2018, 2019 and 2020, respectively. The number of outsourced positions of Top 100 Property Management Companies in China has increased from approximately 0.47 million in 2017 to approximately 0.59 million in 2020, representing a CAGR of approximately 7.9%.

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COMPETITION

Competitive Landscape

According to CIA, the PRC property management industry is fragmented and competitive, with approximately 200,000 property management service providers operating in the industry in 2020. The property management market in China is becoming increasingly concentrated. Our property management services compete against both national and regional property management companies. According to CIA, the market share of the Top 100 Property Management Companies in the PRC was approximately 49.7% in terms of GFA under management in 2020.

Major property management companies in China experienced stable growth in GFA under management in the past years. Large-scale property management companies gained more advantages in the recent years as they experience fast growth in GFA under management. Major property management companies in China have also experienced steady improvement in profitability due to the increase in GFA under management and effective cost control measures.

Our Competitive Position

In the PRC

According to CIA, we had been ranked as one of the top ten among the Top 100 Property Management Companies in terms of overall strength from 2008 to 2019 and in 2021. We did not participate in the ranking of Top 100 Property Management Companies in 2020.

GFA under management

According to CIA, we ranked twelfth among the 2021 Top 100 Property Management Companies in China in terms of GFA under management. We also ranked first in terms of GFA under management among all independent property management companies in China, according to CIA.

Property management Ranking service provider GFA under management

1 Company A approximately 463.0 million sq.m. 2 Company B approximately 380.0 million sq.m. 3 Company C approximately 374.0 million sq.m. 4 Company D approximately 361.0 million sq.m. 5 Company E approximately 300.0 million sq.m...... 12 Our Group approximately 109.4 million sq.m.

Source: CIA

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Entry Barriers

According to CIA, there are a few barriers to enter into the property management industry, including:

• Brand: The Top 100 Property Management Companies, including ourselves, have built up their brand reputation through decades of services and operations. In contrast, new participants, without any established brand or cultivated business relationship with industry participants, face increasing difficulty in penetrating the market.

• Capital requirement: Capital investment is required as the property management companies adopt automation and information technologies to improve their management efficiency through equipment purchase, smart community management and information technology system. Capital availability possesses high barriers to new participants with limited financing ability.

• Quality of management: According to CIA, the expertise and experience of management teams may significantly contribute to the competitiveness of property management companies. Property management companies now have to seamlessly implement technological solutions, management systems, service quality standards and internal policies and procedures across networks of subsidiaries, branches and offices.

• Availability of talent and technical expertise: Property management depends on manual labor, not only for the performance of property management services but also for implementing and innovating technological solutions. It is increasingly difficult for property management companies to recruit and retain talented individuals who are up to date with the technological advances in the industry. New market entrants may find it difficult to compete against larger property management companies with better brand value and recognition for talent.

DIRECTORS’ CONFIRMATION

As of the Latest Practicable Date, after taking reasonable care, our Directors confirm that there was no adverse change in the market information since the respective dates of the various data contained herein, which may qualify, contradict or have an adverse impact on the accuracy and completenes of information in this section in material aspects.

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LAWS AND REGULATIONS RELATING TO PROPERTY MANAGEMENT SERVICES AND OTHER RELATED SERVICES

Foreign Invested Property Management Enterprises

On January 1, 2020, the Measures on Reporting of Foreign Investment Information《外商 ( 投資信息報告辦法》) which was jointly issued by MOFCOM and SAMR came into effect and replaced the Provisional Measures for the Filing Administration of Establishment and Changes of Foreign-Invested Enterprises (2018 Revision)《外商投資企業設立及變更備案管理暫行辦法 ( （2018年修正）》). It sets out the prescribed procedures for the establishment and modifications of foreign-invested enterprises to be registered or filed with delegated commerce authorities through enterprise registration system and specifies the procedures and requirements for online submission in detail.

According to the Regulations on Foreign Investment Guidelines《指導外商投資方向 ( 規定》) (Order No. 346 of the State Council), which was promulgated by the State Council on February 11, 2002 and came into effect on April 1, 2002, foreign investment projects shall be classified into four categories, namely “encouraged”, “permitted”, “restricted” and “prohibited”. Encouraged, restricted and prohibited foreign investment projects shall be listed in the Guideline Catalog of Foreign Investment Industries, while foreign investment projects that do not fall within the encouraged, restricted and prohibited categories shall be classified as belonging to the category of permitted foreign investment projects.

According to the Catalog of Industries for Encouraging Foreign Investment (Edition 2020)《鼓勵外商投資產業目錄 ( （2020年版）》) and the Special Management Measures (Negative List) for the Access of Foreign Investment (Edition 2020)《外商投資准入特別管 ( 理措施（負面清單）（2020年版）》),which was promulgated by the MOFCOM and NDRC on December 27,2020 and on June 23,2020, and came into effect on January 27,2021 and July 23,2020 respectively, property management industry is an industry that allows foreign investors to make investments.

On March 15, 2019, the National People’s Congress (the “NPC”) adopted the Foreign Investment Law of the PRC《中華人民共和國外商投資法》 ( ) (the “Foreign Investment Law”) which became effective on January 1, 2020, the Foreign Investment Law replaced the Law on Sino-Foreign Equity Joint Ventures《中外合資經營企業法》 ( ), the Law on Sino-Foreign Contractual Joint Ventures《中外合作經營企業法》 ( ) and the Law on Wholly Foreign-owned Enterprises《外資企業法》 ( ) to become the legal foundation for foreign investment in the PRC.

Under the Foreign Investment Law, the PRC Government shall implement the administration system of pre-entry national treatment and a negative list for foreign investments, and shall give national treatment to foreign investments which do not fall into Negative List.

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Qualification of Property Management Enterprises

According to the Regulation on Property Management《物業管理條例》 ( ) (Order No. 379 of the State Council), which was promulgated on June 8, 2003, came into effect since September 1, 2003, and was amended on August 26, 2007, February 6, 2016 and March 19, 2018, the construction administration authority of the State Council shall, jointly with the relevant authorities, establish a joint honesty incentives and joint dishonesty punishment mechanism, and strengthen industry credit worthiness administration.

According to the Measures for the Administration on Qualifications of Property Management Enterprises《物業管理企業資質管理辦法》 ( ) (Order No. 125 of the Ministry of Construction), which was promulgated by the Ministry of Construction on March 17, 2004, came into effect on May 1, 2004, was amended on November 26, 2007 and was abolished on March 8, 2018, a system of qualification administration was once adopted and the qualifications of a property management enterprise was classified into first, second and third grades based on specific conditions.

According to Decision of the State Council on Canceling the Third Batch of Administrative Licensing Items Designated by the Central Government for Implementation by Local Governments《國務院關於第三批取消中央指定地方實施行政許 ( 可事項的決定》) (Guo Fa [2017] No. 7), which was promulgated by the State Council on January 12, 2017, the examination and approval of second grade or below qualifications of property management enterprises were canceled. According to the Decision of the State Council on Canceling a Group of Administrative Licensing Items《國務院關於取消一批行 ( 政許可事項的決定》) (Guo Fa [2017] No. 46), which was promulgated by the State Council on September 22, 2017, the examination and approval of first-grade qualification of property management enterprises were canceled.

According to the Notice of the General Office of Ministry of Housing and Urban-Rural Development on Effectively Implementing the Work of Canceling the Qualification Accreditation for Property Management Enterprises《住房城鄉建設部辦公 ( 廳關於做好取消物業服務企業資質核定相關工作的通知》) (Jianbanfang [2017] No. 75), which was promulgated by the General Office of the Ministry of Housing and Urban-Rural Development (the “MOHURD”) on December 15, 2017, application for, change, renewal or re-application of the qualifications of property management enterprises shall not be accepted, and the qualifications obtained already shall not be a requirement for property management enterprises to undertake new property management projects. The real estate administration department at and above the county level shall instruct and supervise the property management work, and the integrity management system of the property management industry will be established, and the supervision of property management enterprises will be based on credit appraisal. The Decision of Ministry of Housing and Urban-Rural Development on Abolishing Measures for the Administration on Qualification of Property Management Enterprise《住房和城鄉建設部關於廢止 ( 〈物業服務企業資質管理辦法〉的決定》) (Order No. 39 of MOHURD) which was promulgated and came into effect on March 8, 2018, abolished Measures for the Administration on Qualifications of Property Management Enterprises and canceled the accreditation of qualifications of property management enterprises.

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The Decision of the State Council on Revising and Repealing Certain Administrative Regulations (2018)《國務院關於修改和廢止部分行政法規的決定 ( (2018年)》) (Order No. 698 of the State Council) which was promulgated and came into effect on March 19, 2018, deleted the requirements on qualifications of property management enterprises in the Regulation on Property Management.

Appointment of Property Service Enterprises

In accordance with the Civil Code of the PRC《中華人民共和國民法典》 ( , the Civil Code) issued by the NPC on May 28, 2020 and came into effect on January 1, 2021, to appoint or dismiss a property management companies should be codetermined by property owners in a property management area. Property owners can either manage the buildings and ancillary facilities by themselves, or engage a property management companies or other management personnel to manage the buildings and ancillary facilities. Property owners are entitled to change property management companies or other management managers appointed by the property developer.

In accordance with the Regulations on Property Management《物業管理條例》 ( ), a general meeting of the property owners of a community can engage or dismiss the property management companies with affirmative votes of owners who own exclusive area accounting for more than half of the total GFA of the community and who account for more than half of the total number of the property owners. Property owners’ committee, on behalf of the property owners, can sign property management contract with property management companies engaged at the general meeting. Where a developer selects and engages any property management companies before it is selected by owners and their general meeting, such developer shall conclude a written preliminary property management contract with the property management companies.

The preliminary property management contract may stipulate the contract duration. If the property management contract signed by the property owners’ committee and the property management companies comes into force within the expiration of the term of the preliminary property management contract, the preliminary property management contract automatically terminates.

In accordance with the Regulations on Property Management and the Interim Measures on Administration of Bid-Invitation and Bidding for Preliminary Property Management《前期物業管理招標投標管理暫行辦法》 ( ) (issued by the Ministry of Construction (revoked) on June 26, 2003 and taking effect on September 1, 2003), developer of residential buildings and non-residential buildings in the same property management area shall engage property management companies by bid-invitation and bidding. In case where there are less than three bidders or for small-scale properties, the developer can hire property management companies by agreement with the approval of the real estate administrative department of the local government of the place where the property is located. Where the developer fails to hire the property management companies through a bid-invitation and bidding process or hire the property management companies by agreement without the approval of relevant government authority, the competent real estate administrative department of the local government at the county level or above shall order it to rectify the situation within a prescribed time limit, issue a warning and impose a penalty of no more than RMB100,000.

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Bid assessment shall be the responsibility of the bid assessment committee established by the developer in accordance with relevant laws and regulations. The bid assessment committee shall be composed of the representatives of the developer and experts in the property management fields. The number of members shall be an odd number at or above five, of which the expert members other than the representatives of the developer shall represent at least two-thirds of the total member. Expert members in the bid assessment committee shall be determined by random select from the panel of experts established by the competent real estate administrative department. A person having an interest with a bidder may not join the bid assessment committee of the related project.

Fees Charged by Property Management Companies

According to the Administrative Measures for Property Service Charges《物業服務 ( 收費管理辦法》) (Fa Gai Jia Ge [2003] No. 1864), which was jointly promulgated by the NDRC and the Ministry of Construction on November 13, 2003 and came into effect on January 1, 2004, property management enterprises are permitted to charge property service fees from property owners for repairing, maintaining and managing houses as well as their accompanying facilities and equipment and relevant sites, and ensuring the sanitation and order of relevant areas according to relevant property management contracts.

Property service charges shall be reasonable, transparent, and suitable for the level of services offered, and shall take into account the unique nature and characteristics of the different property and be priced under the government’s guidance and market regulation respectively. In what way the charges are priced shall be determined by competent price departments under the people’s governments of all provinces, autonomous regions and municipalities directly under the Central Government, in concert with the competent departments of real estate.

As agreed between the property owners and property management enterprises, the fees for the property management services can be charged either on a lump-sum basis or a commission basis. Fees on a lump-sum basis means the property owners pay the property management enterprise a fixed amount of property management fees, and the property management enterprise enjoys the profits and assumes the losses at its own risk. Fees on a commission basis means an agreed percentage or amount of the property management fees collected by the property management enterprise in advance is a commission paid to the property management enterprise, while the rest of such fees is exclusively used for expenses agreed in the property management contract, and the property owners enjoy the surplus or assume the shortage.

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According to the Regulation on Property Management Service Fee with Clear Price Tag《物業服務收費明碼標價規定》 ( ) (Fa Gai Jia Jian [2004] No. 1428), which was jointly promulgated by the NDRC and the Ministry of Construction on July 19, 2004 and came into effect on October 1, 2004, property management enterprises, during their provision of services to the property owners (inclusive of the property service as stipulated in the property management contract as well as other services entrusted by property owners), shall charge service fees at expressly marked prices, and display their service items, standards and other related contents. In case there’s any change to the pricing standard, the property management enterprise shall adjust the related contents displayed and indicate the execution date of new standards one month prior to the implementation of the new standards.

According to the Price Control Liberalization Circular《國家發展和改革委員會關於 ( 放開部分服務價格意見的通知》) (Fa Gai Jia Ge [2014] No. 2755), which was promulgated by the NDRC and became effective on December 17, 2014, price control on property services of non-affordable housing and parking services in residential community was liberalized, including fees charged by a property service enterprise from property owners for the maintenance, conservation and management of non-affordable housing, the supporting facilities and equipment, and the relevant sites thereof, activities of maintaining the environment, sanitation, and relevant order within the property management regions, and other actions completed in accordance with the agreement of the property service contract, upon commission of the property owners. The provincial price authorities shall, jointly with the housing and urban-rural development administrative authorities, decide to implement government guidance prices for charges of property management for affordable housing, housing-reform properties and properties in older residential areas and preliminary property management service in light of the actual situation. In decontrolling the charges of property services for affordable housing and implementing market-regulated prices, the affordability of the supported subjects shall be considered and a subsidy mechanism shall be established.

According to the Circular of the NDRC and the Ministry of Construction on Issuing the Measures for the Supervision and Examination of Pricing Costs of Property Services (Trial) ((國家發展改革委、建設部關於印發《物業服務定價成本監審辦法（試行）》的通知) (Fa Gai Jia Ge [2007] No. 2285) which was jointly issued by the NDRC and the Ministry of Construction on September 10, 2007 and came into effect on October 1, 2007, competent pricing department of people’s government shall formulate or regulate property management charging standards and implements pricing cost supervision and examination on relevant property management enterprises. Property management pricing cost is determined according to the social average cost of property management services verified by the competent pricing department of the people’s government. With the assistance of a competent real estate administrative department, competent pricing department is responsible for organizing the implementation of the property management pricing cost supervision and examination work. Property management service pricing cost shall include staff costs, expenses for daily operation and maintenance on public facilities and equipment, green conservation costs, sanitation fee, order maintenance cost, public facilities and equipment as well as public liability insurance costs, office expenses, shared administration fee, fixed assets depreciation and other fees approved by property owners.

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According to the Measures on Government Pricing Cost Supervision and Examination《政府制定價格成本監審辦法》 ( ) (Order No. 8 of the NDRC) which was issued by the NDRC on October 30, 2017 and taking effect on January 1, 2018, if the pricing authority implements cost supervision and examination, the relevant business operators shall be informed in writing. The operator shall be obliged to provide the information required for the relevant goods or services cost supervision and examination after receiving the notice, and shall be responsible for the authenticity, legitimacy and completeness of the relevant information.

Property Management Service Outsourcing

According to the Regulations on Property Management, a property management enterprise may outsource a specific service within the property management area to a specialized service enterprise, but it shall not outsource all the property management business within such area to third parties. Where a property management enterprise outsource all the property management business within such area to third parties, the competent real estate administrative department of the local government at the county level or above shall order it to rectify the situation within a prescribed time limit, and impose on it a fine ranging from 30% to 50% of the price of the outsourcing contract.

According to the Civil Code of the PRC, where a property management enterprise delegates some specialized services in the property management service area to a specialized service organization or any other third party, the property management enterprise shall be responsible to owners for the specialized services. A property management enterprise shall not delegate to a third party all the property management services it should provide, or delegate all property management services as divided to third parties respectively.

Fire Protection

Pursuant to the Fire Protection Law of the PRC《中華人民共和國消防法》 ( ), which was promulgated by the Standing Committee of the National People’s Congress (the “SCNPC”) on April 29, 1998, and was amended on October 28, 2008, April 23, 2019 and April 29, 2021, property management enterprises of residential community shall carry out maintenance and administration of common firefighting facilities within the area under their management, and provide fire safety prevention services.

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REGULATION ON OUR OTHER BUSINESSES

Supervision on Internet Information Services

According to the Administrative Measures on Internet Information Services《互聯 ( 網信息服務管理辦法》) which was issued by the State Council on September 25, 2000, came into effect on the same day and amended on January 8, 2011, Internet information service refers to the provision of information through Internet to web users, and includes two categories: commercial and non-commercial. Commercial Internet information service refers to the provision with charge of payment of information through the Internet to web users or of web page designing, etc. Non-commercial Internet information service refers to the provision free of charge of public, commonly-shared information through the Internet to web users.

Entities engaged in providing commercial Internet information service shall apply for a license for value-added telecommunication services of Internet information services. As for the operation of non-commercial Internet information services, only a filing is required.

Internet information service provider shall provide services within the scope of their licenses or filing. Non-commercial Internet information service providers shall not provide services with charge of payment. In case an Internet information service provider changes its services, website address, etc., it shall apply for approval 30 days in advance at the relevant government department. In accordance with the abovementioned regulations, where an entity provides commercial Internet information service without a license or provides service beyond the scope of the license, provincial telecommunication administrative department shall order it to make correction within a prescribed time limit. Where there are illegal gains, such gains shall be confiscated; and a fine more than three times and less than five times of such gains shall be imposed. Where there is no illegal gain or the gain is less than RMB50,000, a fine of RMB100,000 to RMB1 million shall be imposed. Where the circumstance is serious, the website shall be ordered to shut down. Where an entity provides non-commercial Internet information service without a filing, provincial telecommunication administrative department shall order it to make corrections within a prescribed time limit and to shut down the website if it refused to make corrections.

In accordance with the Provisions on Administration of Mobile Internet Application Information Services《移動互聯網應用程序信息服務管理規定》 ( ) which was issued by the Cyberspace Administration of China on June 28, 2016 and came into effect on August 1, 2016, entities providing information services through mobile Internet applications shall obtain relevant qualifications in accordance with law. Mobile Internet application provider shall not use mobile Internet application program to carry out activities prohibited by laws and regulations, such as endangering national security, disturbing public orders, and infringing other’s legal rights and interests, or use mobile internet applications to produce, copy, publish and spread illegal information prohibited by laws and regulations.

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The Cyberspace Administration of China shall be responsible for the supervision and administration of information on mobile Internet applications nationwide. The local cyberspace administrations shall be responsible for the supervision and administration of information on mobile Internet application program within the administrative regions.

Information Security and Privacy Protection

According to the Cyber Security Law of the PRC《中華人民共和國網絡安全法》 ( ), which was promulgated by the SCNPC on November 7, 2016 and came into effect on June 1, 2017, network operators shall comply with laws and regulations and fulfill their obligations to ensure the security of the network when conducting business and providing services. Those who provide services through networks shall take technical measures and other necessary measures in accordance with laws, regulations and compulsory national requirements to safeguard the safe and stable operation of the networks, respond to network security incidents effectively, prevent illegal and criminal activities committed on the network, and maintain the integrity, confidentiality, and availability of network data. In addition, the network operators shall neither collect the personal information irrelevant to the services provided by them nor collect or use the personal information in violation of the provisions of any laws or administrative regulation or the agreement between both parties.

On December 28, 2012, the SCNPC promulgated the Decision on Strengthening Information Protection on Networks《全國人民代表大會常務委員會關於加強網絡信息保護 ( 的決定》) to enhance the protection of information security and privacy on the Internet. On July 16, 2013, the Ministry of Industry and Information Technology (the “MIIT”) promulgated the Provisions on Protection of Personal Information of Telecommunication and the Internet Users《電信和互聯網用戶個人信息保護規定》 ( ), which became effective on September 1, 2013, to regulate the collection and use of personal information of users in the provision of telecommunication service and the Internet information service.

According to the Several Provisions on Regulating the Market Order of the Internet Information Services《規範互聯網信息服務市場秩序若干規定》 ( ), which was promulgated by the MIIT on December 29, 2011, and came into effect on March 15, 2012, without the consent of users, the Internet information service providers shall neither collect information which is relevant to users and can serve to identify users solely or in combination with other information (the “personal information of users”) nor shall they provide personal information of users to others, unless otherwise provided by laws and administrative regulations. The Provisions on Regulating the Market Order of the Internet Information Services also require that the Internet information service providers shall properly preserve the personal information of users.

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On May 8, 2017, the Supreme People’s Court and the Supreme People’s Procuratorate released the Interpretations of the Supreme People’s Court and the Supreme People’s Procuratorate on Several Issues Concerning the Application of Law in the Handling of Criminal Cases Involving Infringement of Citizens’ Personal Information《最高人民法院、最高人民檢察 ( 院關於辦理侵犯公民個人信息刑事案件適用法律若干問題的解釋》) (the “Interpretations”), effective from June 1, 2017. The Interpretations clarify several concepts regarding the crime of “infringement of citizens’ personal information” stipulated by Article 253A of the Criminal Law of the PRC《中華人民共和國刑法》 ( ), including “citizens’ personal information”, “provision of citizens’ personal information” and “illegally obtaining any citizen’s personal information by other methods”. In addition, the Interpretations specify the standards for determining “serious circumstances” and “particularly serious circumstances” of this crime.

Regulations on Catering Services

According to the Food Safety Law of the PRC (Amended in 2018)《中華人民共和國 ( 食品安全法（2018修正）》) which was issued by the SCNPC on February 28, 2009, taking effect on June 1, 2009, and amended on April 24, 2015 and December 29, 2018 and the Administrative Measures for Food Operation Licensing (Amended in 2017)《食品經營許 ( 可管理辦法(2017修正)》) which was issued by the China Food and Drug Administration on August 31, 2015, taking effect on October 1, 2015 and most recently amended on November 17, 2017, food sales and catering business in the PRC are subject to obtaining the food operation license in accordance with the laws. The principle of one license for one place shall apply to the licensing for food operation, that is, a food business operator shall obtain a food operation license for each operation site at which it carries out the food business. The food business operators shall meet food safety standards, establish and improve food safety management systems, provide employees with trainings on food safety knowledge, strengthen food inspections, establish and implement employees health management systems and raw materials control requirements, and be responsible for the safety of the food they sell.

Supervision and Control over Advertising Business

In accordance with the Advertising Law of the PRC《中華人民共和國廣告法》 ( ) which was issued by the SCNPC on October 27, 1994, came into effect on February 1, 1995 and amended on April 24, 2015 and October 26, 2018, advertisement shall be expressed in a true, legal, healthy manners, in line with requirements of construction of socialist spiritual civilization and development of Chinese national fine cultural tradition, and shall not contain false or misleading content and defraud or mislead consumers. Advertisers, advertising agents and advertisement publishers shall abide by the laws, regulations and the principles of justice, honesty and fair competition in carrying out advertising activities. Local administrative departments for industry and commerce at and above the county level shall take charge of the supervision and administration on advertising within their respective administrative jurisdictions. Other relevant departments of the local people’s governments at and above the county level shall take charge of the advertising management-related work within their respective scope of duties.

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LAWS AND REGULATIONS RELATING TO INTELLECTUAL PROPERTY

Trademark Law

According to the Trademark Law of the PRC《中華人民共和國商標法》 ( ) (Order No. 10 of SCNPC), which was promulgated on August 23, 1982, and amended on February 22, 1993, October 27, 2001, August 30, 2013, April 23, 2019 and taking effect on November 1, 2019, and the Implementation Regulations on the Trademark Law of the PRC《中華人民共 ( 和國商標法實施條例》) (Order No. 358 of the State Council) which was promulgated by the State Council on August 3, 2002 and amended on April 29, 2014 and taking effect on May 1, 2014, trademarks approved for registration by the Trademark Office of the Administrative Department of Industry and Commerce of the State Council are registered trademarks. Trademark registrants shall be entitled to the exclusive use of their trademarks and shall be protected by law. The trademark registrant may, by concluding a trademark licensing contract, authorize others to use the registered trademark. The licensor shall supervise the quality of the goods on which the licensee uses the licensor’s registered trademark, and the licensee shall guarantee the quality of the goods on which the registered trademark is used. For licensed use of a registered trademark, the licensor shall file record of the licensing of the said trademark with the Trademark Office and the latter shall make corresponding publication, while non-filing of the licensing of a trademark shall not be contested against a good faith third party.

Patent

According to the Patent Law of the PRC《中華人民共和國專利法》 ( ) (No. 11 Order of the President of the PRC), which was issued by the SCNPC on March 12, 1984, taking effect on April 1, 1985, and amended on September 4, 1992, August 25, 2000, December 27, 2008 and 17 October, 2020 and will become effective on June 1, 2021, the inventions, utility models and designs can be protected by the patent right. The patent administrative department under the State Council is responsible for the administration of patent-related work nationwide. It accepts and examines patent applications in a uniform way and grants patent rights in accordance with the law. Any entity or individual other than the patentee who wants to implement another person’s patent must obtain permission from the patentee unless otherwise provided by law. Any entity or individual that seeks to exploit a patent owned by another party shall enter into a patent license contract with the patent owner concerned and pay patent royalties to the patent owner. The licensee does not have the right to allow any entity or individual not specified in the contract to exploit such patent.

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The Copyright Law of the PRC《中華人民共和國著作權法》 ( ) (No. 31 Order of the President of the PRC), which was issued by the SCNPC on September 7, 1990, came into effect on June 1, 1991 and was amended on October 27, 2001 and February 26, 2010 and was amended on November 11, 2020 and will become effective on June 1, 2021, specifies that works of Chinese citizens, legal persons or other organizations, whether published or not, all own the copyright. Copyright holder can exercise multiple rights, including but not limited to the right of publication, the right of authorship and the right of reproduction. Unless otherwise stipulated by law, anyone who uses others’ works shall enter into a licensing contract with the copyright holder.

The Measures for the Registration of Computer Software Copyright《計算機軟件著 ( 作權登記辦法》) (No. 1 Order of the National Copyright Administration), which was issued by the National Copyright Administration on February 20, 2002, and came into effect on the same day, regulates the registration of software copyright, the exclusive licensing contract and transfer contracts of software copyright. The National Copyright Administration is mainly responsible for the registration and management of national software copyright and recognizes the China Copyright Protection Center as the software registration organization. The China Copyright Protection Center will grant certificates of registration to computer software copyright applicants in compliance with the regulations of the Measures for the Registration of Computer Software Copyright and the Regulations on Protection of Computers Software《計算機軟件保護條例》 ( ) (No. 339 Order of the State Council) issued by the State Council on December 20, 2001, came into effect on January 1, 2002 and revised on January 8, 2011 and January 30, 2013.

Domain Name

According to the Administrative Measures for Internet Domain Names《互聯網域名 ( 管理辦法》) (No. 43 Order of the Ministry of Industry and Information Technology), which was issued by the Ministry of Industry and Information Technology on August 24, 2017 and came into effect on November 1, 2017, the Ministry of Industry and Information Technology is responsible for managing Internet network domain names of China. The “.CN” and the “.zhongguo (in Chinese character)” shall be China’s national top-level domains. The principle of “first-to-file” is adopted for domain name services. The applicant of domain name registration shall provide the agency of domain name registration with the true, accurate and complete information about the domain name holder’s identity for the registration purpose. Any organization or individual who believes that the domain name registered or used by others infringes its legitimate rights and interests may apply to the domain name dispute resolution institution for arbitration or file a lawsuit with a people’s court in accordance with the law.

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LABOR LAWS AND REGULATIONS

Pursuant to the PRC Labor Law《中華人民共和國勞動法》 ( ) (the “Labor Law”), which was promulgated by the SCNPC on July 5, 1994 and became effective on January 1, 1995 and subsequently amended on August 27, 2009 and December 29, 2018, the PRC Labor Contract Law《中華人民共和國勞動合同法》 ( ), which was promulgated by the SCNPC on June 29, 2007 and came into effect on January 1, 2008, and subsequently amended on December 28, 2012 and came into effect on July 1, 2013, and the Implementing Regulations of the Labor Contract Law of the PRC《中華人民共和國勞動合同法實施條例》 ( ), which was promulgated by the State Council and became effective on September 18, 2008, employers shall establish an employment relationship with employees on the date that they start employing the employees. To establish employment, a employment contract in written form shall be executed between employers and employees. Wages of the employees cannot be lower than local minimum wage. The employer must establish a system for labor safety and sanitation, strictly abide by State rules and standards, provide education regarding labor safety and sanitation to its employees, provide employees with labor safety and sanitation conditions and necessary protection materials in compliance with State rules, and carry out regular health examination for employees engaged in work involving occupational hazards.

Pursuant to the Interim Provisions on Labor Dispatching《勞務派遣暫行規定》 ( ) issued by the Ministry of Human Resources and Social Security on January 24, 2014 and effective as of March 1, 2014, employers may only use dispatched workers for temporary, ancillary or substitute positions, and the number of dispatched workers shall not exceed 10% of the employers’ total employees.

As required under the Social Insurance Law of the PRC《中華人民共和國社會保險 ( 法》) (the “PRC Social Insurance Law”), the Decisions on the Establishment of a Unified Program for Basic Old-Aged Pension Insurance for Employees of Corporations of the State Council《國務院關於建立統一的企業職工基本養老保險制度的決定》 ( ), the Decisions on the Establishment of the Medical Insurance Program for Urban Workers of the State Council《國務院關於建立城鎮職工基本醫療保險制度的決定》 ( ), the Regulation of Insurance for Work-Related Injury《工傷保險條例》 ( ), the Regulations on Unemployment Insurance《失業保險條例》 ( ), the Provisional Measures on Insurance for Maternity of Employee《企業職工生育保險試行辦法》 ( ), the Interim Regulation on the Collection and Payment of Social Insurance Premiums《社會保險費徵繳暫行條例》 ( ), the Administrative Regulation on Housing Provident Fund《住房公積金管理條例》 ( ) and other related regulations, rules and provisions issued by the relevant governmental authorities from time to time, enterprises in China are obliged to provide employees with welfare schemes covering pension insurance, unemployment insurance, maternity insurance, injury insurance, medical insurance and housing provident fund.

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According to the Regulations on the Administration of Housing Provident Fund《住房公 ( 積金管理條例》)(Order No. 262 of the State Council) issued by the State Council on April 3, 1999 and became effective on the same day, and amended on March 24, 2002 and March 24, 2019, the housing provident fund contributions by his or her employer shall be owned by the individual employee. Employers shall timely pay the housing provident fund in full and overdue or insufficient payment shall be prohibited. Employers shall process the housing fund payment and deposit registration in the housing provident fund administrative center. For enterprises who violate the above laws and regulations and fail to apply for housing provident fund deposit registration or open housing provident fund accounts for their employees, the housing provident fund administrative center shall order the relevant enterprises to make corrections within a designated period. Those enterprises failing to process registration and open provident fund accounts for their employees within designated period shall be subject to a fine ranging from RMB10,000 to RMB50,000. When enterprises violate those provisions and fail to pay the housing provident fund in full amount as due, the housing provident fund administrative center will order such enterprises to pay up the amount within a prescribed period; if those enterprises still fails to comply with the regulations upon the expiration of the above-mentioned time limit, further application will be made to the People’s Court for mandatory enforcement.

According to the Plan on Deepening Institutional Reformation of Party and Government《深化黨和國家機構改革方案》 ( ), the governing agency of social insurance contribution (including but not limited to the basic pension insurance, basic medical insurance, work-related injury insurance and unemployment insurance) will be changed to tax authority. According to the Notice on Conducting the Relevant Work Concerning the Administration of Collection of Social Insurance Premiums in a Steady, Orderly and Effective Manner《國家稅務總局辦公廳關於穩妥有序做好社會保險費徵管有關工作的通知》 ( ) (Shui Zong Ban Fa [2018] No. 142) promulgated by the State Taxation Administration (the “SAT”) and became effective on September 13, 2018 and the Urgent Notice on Implementing the Spirit of the Executive Meeting of the State Council in Stabilizing the Collection of Social Security Contributions《人力資源社會保障部辦公廳關於貫徹落實國務院常務會議精神切實做 ( 好穩定社保費徵收工作的緊急通知》) (Ren She Ting Han [2018] No. 246) promulgated by the General Office of the Ministry of Human Resources and Social Security and became effective on September 21, 2018, all the local authorities responsible for the collection of social insurance are strictly forbidden to conduct self-collection of historical unpaid social insurance contributions from enterprises. Notice on Implementing Measures to Further Support and Serve the Development of Private Economy《國家稅務總局關於實施進一步支持 ( 和服務民營經濟發展若干措施的通知》) (Shui Zong Fa [2018] No. 174) promulgated by the SAT and became effective on November 16, 2018, repeated that tax authorities at all levels may not organize self-collection of arrears of taxpayers including private enterprises in the previous years.

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SHANGHAI-HONG KONG STOCK CONNECT

On April 10, 2014, CSRC and Hong Kong Securities and Futures Commission (hereinafter referred to as “SFC”) issued the Joint Announcement of China Securities Regulatory Commission and Hong Kong Securities and Futures Commission – Principles that Should be Followed when the Pilot Programme that Links the Stock Markets in Shanghai and Hong Kong is Expected to be Implemented and approved in principle the launch of the pilot programme that links the stock markets in Shanghai and Hong Kong《中國證券監督管 ( 理委員會香港證券及期貨事務監察委員會聯合公告 – 預期實行滬港股票市場交易互聯互通機制試點時將需遵循的原則》) (hereinafter referred to as “Shanghai-Hong Kong Stock Connect”) by the Shanghai Stock Exchange (hereinafter referred to as “SSE”), the Stock Exchange, CSDC and HKSCC. Shanghai-Hong Kong Stock Connect comprises the two portions of Northbound Trading Link and Southbound Trading Link. Southbound Trading Link refers to the entrustment of China securities houses by China investors to trade stocks listed on the Stock Exchange within a stipulated range via filing by the securities trading service company established by the SSE with the Stock Exchange. During the initial period of the pilot programme, the stocks of Southbound Trading Link consist of constituent stocks of the Stock Exchange Hang Seng Composite Large Cap Index and the Hang Seng Composite MidCap Index as well as stocks of A+H stock companies concurrently listed on the Stock Exchange and the SSE. The total limit of Southbound Trading Link is RMB250 billion and the daily limit is RMB10.5 billion. During the initial period of the pilot programme, it is required by SFC that China investors participating in Southbound Trading Link are only limited to institutional investors and individual investors with a securities account and capital account balance of not less than RMB500,000.

On November 10, 2014, CSRC and SFC issued a Joint Announcement, approving the official launch of Shanghai-Hong Kong Stock Connect by SSE, the Stock Exchange, CSDCC and HKSCC. Pursuant to the Joint Announcement, trading of stocks under Shanghai-Hong Kong Stock Connect will commence on November 17, 2014.

On September 30, 2016, CSRC issued the Filing Provision on the Placement of Shares by Hong Kong Listed Companies with Domestic Original Shareholders under Southbound Trading Link《關於港股通下香港上市公司向境內原股東配售股份的備案規定》 ( ) which came into effect on the same day. The act of the placement of shares by Hong Kong listed companies with domestic original shareholders under Southbound Trading Link shall be filed with CSRC. Hong Kong listed companies shall file the application materials and approved documents with CSRC after obtaining approval from the Stock Exchange for their share placement applications. CSRC will carry out supervision based on the approved opinion and conclusion of the Hong Kong side.

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REGULATIONS RELATED TO THE “FULL CIRCULATION” OF H-SHARE

“Full circulation” means listing and circulating on the Stock Exchange of the domestic unlisted shares of an H-share listed company, including unlisted Domestic Shares held by domestic shareholders prior to overseas listing, unlisted Domestic Shares additionally issued after overseas listing, and unlisted shares held by foreign shareholders.

On November 14, 2019, CSRC announced the Guidelines for the “Full Circulation” Program for Domestic Unlisted Shares of H-share Listed Companies《 ( H股公司境內未上市股份申請“全流通”業務指引》) (Announcement of the CSRC [2019] No. 22) (“Guidelines for the ‘Full Circulation”).

According to the Guidelines for the “Full Circulation”, shareholders of domestic unlisted shares may determine by themselves through consultation the amount and proportion of shares, for which an application will be filed for circulation, provided that the requirements laid down in the relevant laws and regulations and set out in the policies for state-owned asset administration, foreign investment and industry regulation are met, and the corresponding H-share listed company may be entrusted to file the said application for “full circulation”. To file an application for “full circulation”, an H-share listed company shall file the application with the CSRC according to the administrative licensing procedures necessary for the “examination and approval of public issuance and listing (including additional issuance) of shares overseas by a joint stock company”. An H-share listed company may apply for “full circulation” separately or when applying for refinancing abroad. An unlisted domestic joint stock company may apply for “full circulation” when applying for an overseas initial public offering. After the application for “full circulation” has been approved by the CSRC, an H-share listed company shall submit a report on the relevant situation to the CSRC within 15 days after the conversion registration with the CSDC of the shares related to the application has been completed. After domestic unlisted shares are listed and circulated on the Stock Exchange, they may not be transferred back to China.

On December 31, 2019, CSDC and Shenzhen Stock Exchange (“SZSE”) jointly announced the Measures for Implementation of H-share “Full Circulation” Business《 ( H股「全流通」業務實施細則》)(“Measures for Implementation”). The businesses of cross-border conversion registration, maintenance of deposit and holding details, transaction entrustment and instruction transmission, settlement, management of settlement participants, services of nominal holders, etc. in relation to the H-share “full circulation” business, are subject to the Measures for Implementation. Where there is no provision in the Measures for Implementation, it shall be handled with reference to other business rules of the CSDC and China Securities Depository and Clearing (Hong Kong) Company Limited (“CSDC (Hong Kong)”) and SZSE.

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According to the Measures for Implementation, after having completed relevant information disclosure, the H-share listed companies with the approval of the CSRC to engage in the H-share “full circulation” business shall apply to the CSDC for the deregistration of part or all of the domestic unlisted shares, and shall transfer the fully circulated H-shares which are not pledged, frozen, restricted to transfer to the share register institutions in Hong Kong. Such shares shall become eligible for listing and circulation on the Stock Exchange. Relevant securities are centrally deposited in CSDC for settlement. As the nominal holder of the above-mentioned securities, CSDC handles the depository and holding details maintenance, cross-border clearing and settlement and other businesses involved in the “full circulation” of H-shares, and provides nominal holder services for investors. The H-share listed company shall be authorized by “fully-tradable” shareholders to choose domestic securities companies that participate in the “full circulation” business of H-shares. Investors submit trading instructions of H-shares “fully tradable” shares through domestic securities companies. Domestic securities companies shall select a Hong Kong securities company to submit trading instructions of the investors to the Stock Exchange for trading. After the transaction is concluded, CSDC and CSDC (Hong Kong) shall handle the cross-border clearing and settlement of relevant shares and funds. The settlement currency of H-share “full circulation” transaction business is Hong Kong dollars. Where an H-share listed company entrusts CSDC to distribute cash dividends, it shall file an application with CSDC. An H-share listed company distributing cash dividends may apply to the CSDC for the holding details of relevant “fully-tradable” shareholders on the securities registration date. The non-H-share “fully circulated” securities listed on the Stock Exchange obtained due to the distribution or conversion of H-shares “fully circulated” securities may be sold but shall not be purchased. Where the right to subscribe for the shares listed on the Stock Exchange is obtained and the subscription right is listed on the Stock Exchange, it may be sold, but shall not be exercised.

In order to fully promote the reform of H-shares “full circulation” and clarify the business arrangement and procedures for the relevant shares’ registration, custody, settlement and delivery, CSDC has promulgated the Circular on Issuing the Guide to the Program for Full Circulation of H-shares《關於發佈 ( 〈H股「全流通」業務指南〉的通知》)in February 2020, which specified the business preparation, account arrangement, cross-border share transfer registration and overseas centralized custody, etc. On February 7, 2020, CSDC (Hong Kong) also promulgated the Guide to the Program for Full Circulation of H-shares《中國證券登記結算 ( （香港）有限公司H股「全流通」業務指南》)to specify the relevant escrow, custody, agent service of CSDC (Hong Kong), arrangement for settlement and delivery and other relevant matters.

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HISTORY AND DEVELOPMENT

Overview

Our history can be tracked back to 1993, when the predecessor of our Company, Shenzhen Changcheng Property Management Company (深圳市長城物業管理公司) was established. Through more than 28 years of operations, we have grown into the largest independent property management company in China, as well as the only independent property management company among the Top 10 Property Management Companies in China in 2021, according to CIA.

We have established a nationwide service network. We were one of the first-movers in nationwide expansion among property management service providers in China. In 1999, we expanded our business to Beijing and since then we have been strategically expanding our service across China. As of March 31, 2021, our project portfolio encompassed projects located in 162 cities across 31 provinces, municipalities and autonomous regions in China, with 62.4% of our GFA under management located in tier-one or new tier-one cities.

We do not rely on any affiliated property developer and therefore, market competitiveness has been the key driver of our success since our inception. As we have to compete for project on the open market, we strive to develop keen insights for market trends and customer needs to provide services that are above the expectation of our customers. Our ability to succeed under market competition is testified by our proven track record in obtaining management projects from property developers and owners who are independent from us, and our dedication to customer services and continuing self-improvement has been reflected in our market recognition and customer loyalty.

Business Development Milestones

The following events set forth the key milestones of our business development:

Year Event

1993 The predecessor of our Company, Shenzhen Changcheng Property Management Company (深圳市長城物業管理公司) was established

1996 Our management project Changle Garden was awarded as National Urban Property Management Excellent Building (全國城市物業管理優秀大廈)

1997 We were accredited with the ISO9002 Quality Management System Certification

1999 We won the bid of the property management rights of Area C in Beijing Huilongguan Cultural Residential Area (Stage I) (北京回龍觀文化居住區（一期）), and began our expansion across the entire nation

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Year Event

2000 We entered the property consulting market as a property management consultant for the New Century Garden (新世紀豪園) in Dongguan

2001 We were among the first 40 awardees to be qualified as a national first-class property management company

We obtained ISO14001 Environmental Management System Certification and OHSAS18001 Occupational Health and Safety Certification for certain properties

2003 We converted into a joint stock company

2008 We were one of the property services providers for Beijing Olympic Village

We first ranked as the top ten among the Top 100 Property Management Companies in terms of overall strength

We undertook the property management of Shangrao City New Office Area (上饒市新辦公區), marking our property management services into the government office building

2010 We were the property management service provider of Tianjin Meijiang Convention and Exhibition Center (天津梅江會展中心) when the Davos Forum was held there

2011 We became a service provider for the Xi’an World Garden Expo (西安世界園藝博覽) in respect of property consulting, engineering facilities and equipment operation and maintenance of the project

2013 We initiated the “EINYUN Cloud Platform (一應雲平台)” to provide other property management companies access to various industry-related information technology products and services through this platform

2015 We, together with other property management companies, jointly initiated and set up the EINWIN Alliance (一應雲聯盟)

2018 We initiated the Yiying Qingteng Plan (一應青藤計劃) to upgrade our community value-added services

We obtained ISO/IEC 27001 Information Security Management System Certification

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Year Event

2019 We obtained ISO50001 Energy Management Eanagement System Certification

2020 We ranked first among all independent property management company in China in terms of GFA under management

2021 We were ranked as the top ten among the Top 100 Property Management Companies in terms of overall strength

OUR CORPORATE DEVELOPMENT

The major corporate developments of our Company and our key operating subsidiaries which were material to our performance during the Track Record Period are set out below.

Our Company

The predecessor of our Company named Shenzhen Changcheng Property Management Company (深圳市長城物業管理公司) was established in the PRC on April 1, 1993 with an initial registered capital of RMB1,000,000. Upon its establishment, it was wholly owned by Shenzhen Changcheng Property Development Company (深圳市長城房地產發展公司) (currently known as Centralcon Holding). Centralcon Holding was a state-owned company established in the PRC in September 1984, and was converted into a joint stock company with limited liability and subsequently listed on the SZSE in September 1994.

Subsequent to the increase of registered capital and equity transfers for the period from December 1996 to March 1999, Shenzhen Changcheng Property Management Company was converted to a company with limited liability which was owned as to approximately 61.88% by Changcheng Property Group Co., Ltd. Trade Union Committee (長城物業集團股份有限公司工會委員會) (formerly known as Shenzhen Changcheng Property Management Co., Ltd. Trade Union Committee (深圳市長城物業管理有限公司工會委員會)) (the “Trade Union”) pursuant to an employee stock ownership plan approved by Shenzhen Construction Investment Holding Company Limited (深圳市建設投資控股有限公司), holding such interests on behalf of our 85 then employees, and approximately 38.12% by Centralcon Holding. Upon the completion of such equity changes, the registered share capital of our Company was RMB8,000,000.

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On June 5, 2003, our Company converted into a joint stock company with limited liability and the share capital of our Company was increased to RMB15,000,000 divided into 15,000,000 Shares with a nominal value of RMB1.00 each, of which the Trade Union, Centralcon Holding, Mr. Chen Yaozhong, Mr. Yang Zhongchang and Changcheng Logistics Co., Ltd. (深圳市長城物流有限公司) (formerly known as Shenzhen Changcheng Chuyun Co., Ltd. (深圳市長城儲運有限公司)) (“Changcheng Logistics”) held 8,220,000 Shares, 4,680,000 Shares, 1,200,000 Shares, 750,000 Shares and 150,000 Shares, representing approximately 54.8%, 31.2%, 8.0%, 5.0% and 1.0% of our share capital, respectively. Mr. Yang Zhongchang, our then Director, subscribed for 750,000 Shares at a consideration of RMB750,000. Changcheng Logistics, a wholly-owned subsidiary of Centralcon Holding, subscribed for 150,000 Shares at a consideration of RMB150,000. Mr. Chen Yaozhong, our executive Director and one of our Ultimate Controlling Shareholders, subscribed for 1,200,000 Shares at a consideration of RMB1,200,000.

Subsequent to a series of the share capital increase and share transfers for the period from September 2008 to August 2012, the share capital of our Company was increased to RMB131,544,000 and our Company became owned as to approximately 54.80% by the Trade Union, 21.52% by Centralcon Holding, 9.99% by Shenzhen Tongda Investment Consultation Co., Ltd. (深圳市同達投資諮詢有限責任公司)(“Shenzhen Tongda”), 8.00% by Shenzhen Ruizhe Enterprise Management Consultation Co., Ltd. (深圳市睿哲企業管理諮詢有限公司)(“Shenzhen Ruizhe”), 5.00% by Shenzhen Changrui Enterprise Management Consultation Co., Ltd. (深圳市常睿企業管理諮詢有限公司)(“Shenzhen Changrui”) and 0.69% by Changcheng Logistics. Shenzhen Tongda was wholly owned by Mr. Ma Xingwen, our non-executive Director and one of our Ultimate Controlling Shareholders. Shenzhen Ruizhe was wholly owned by Mr. Chen Yaozhong. Shenzhen Changrui was wholly owned by Mr. Yang Zhongchang.

For the purpose of streamlining the development of the core business of our Company and taking into account the business strategies of our Company, on July 20, 2015, our Company demerged into two legal entities, namely our Company and Shenzhen Jiaye Investment Holdings Co., Ltd. (深圳市嘉業投資控股有限公司)(“Shenzhen Jiaye Investment”), a company primarily engaged in investment of property, and the registered capital of our Company was decreased from RMB131,544,000 to RMB81,544,000 accordingly. Upon completion of such demerger, the shareholding structure of our Company remained the same. Our Company has been focusing more on the development of our property management business since then.

On January 21, 2016, due to an internal reorganization of Centralcon Holding, each of Centralcon Holding and Changcheng Logistics transferred all the Shares they each held in our Company to Centralcon Capital at a consideration of RMB2,900,000 and RMB90,000, respectively. Centralcon Capital, one of our substantial Shareholders, is a wholly-owned subsidiary of Centralcon Holding. Upon completion of the such share transfers, our Company became owned as to approximately 54.80% by the Trade Union, 22.21% by Centralcon Capital, 9.99% by Shenzhen Tongda, 8.00% by Shenzhen Ruizhe and 5.00% by Shenzhen Changrui.

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For the purpose of strengthening the ancillary value-added services as well as upgrading our property management services to our customers, our Company acquired the entire equity interest of Yiying Community Technology Group at a consideration of RMB146 million (the “Yiying Community Acquisition”). The consideration was settled by the issue of the aggregated 29,763,559 new Shares to the then shareholders of Yiying Community Technology Group. Upon completion of such acquisition, on January 29, 2016, the share capital of our Company increased from RMB81,544,000 to RMB111,307,559. Yiying Community Technology Group was a company primarily engaged in e-commerce, network technology consultancy as well as provision of community value-added services. The net asset value of Yiying Community Technology Group was RMB152,989,800 as of December 29, 2015 and it was owned as to approximately 42.63% by Trade Union, 22.21% by Centralcon Capital, 10.97% by Shenzhen Tongda, 10.97% by Shenzhen Ruizhe, 7.78% by Shenzhen Jiaye Investment Consultation Co., Ltd. (深圳市嘉業投資諮詢有限公司)(“Jiaye Investment Consultation”), 3.89% by Mr. Yang Zhongchang and 1.56% by Mr. Bu Wenxiang (卜文祥) (our employee) immediately before completion of the acquisition. Upon completion of such acquisition, our Company became owned as to approximately 51.55% by the Trade Union, 22.21% by Centralcon Capital, 10.26% by Shenzhen Tongda, 8.79% by Shenzhen Ruizhe, 3.66% by Shenzhen Changrui, 2.08% by Jiaye Investment Consultation, 1.04% by Mr. Yang Zhongchang and 0.42% by Mr. Bu Wenxiang.

In order to optimize our equity structure as well as to restructure our then employee stock ownership arrangement, our then employee Shareholders approved that a new form of employee stock ownership platform shall be established to hold the Shares held by the Trade Union on trust for our then employees, Shares directly held by the relevant employees and indirectly held through holding companies wholly owned by the relevant employees. Accordingly, Xicheng Ruijia, Xicheng Ruihe, Xicheng Ruifeng, Xicheng Ruiying, Shenzhen Xicheng Lifeng Investment Consultation Partnership (Limited Partnership) (深圳市熙城利豐投資諮詢合夥企業（有限合夥）)(“Xicheng Lifeng”) and Shenzhen Xicheng Ying’an Investment Consultation Partnership (Limited Partnership) (深圳市熙城盈安投資諮詢合夥企業（有限合夥）)(“Xicheng Ying’an”) were established in February 2016. The general partners and limited partners of the aforesaid limited partnerships at the time of establishment were, or were wholly-owned by, our then employees and former employees, of which general partner(s) of (i) Xicheng Ruijia being Shenzhen Ruizhe (as the executive general partner, which in turn is wholly-owned by Mr. Chen Yaozhong (one of our Ultimate Controlling Shareholders)), Mr. Xiao Jiarui and Ms. Wang Yuan; (ii) Xicheng Ruihe being Shenzhen Tongda (as the executive general partner, which in turn is wholly-owned by Mr. Ma Xingwen (one of our Ultimate Controlling Shareholders)), Mr. Fan Zhiwei and Mr. Feng Gang; (iii) Xicheng Ruifeng being Mr. Lv Yuhua (as the executive general partner and one of our Ultimate Controlling Shareholders), Mr. Jiang Wei and Mr. Li Zhijian; (iv) Xicheng Ruiying being Mr. Liang Zhijun (as the executive general partner and one of our Ultimate Controlling Shareholders), Mr. Cao Kelong and Mr. Xuan Wang; (v) Xicheng Lifeng being Mr. Fan Zhiwei; and (vi) Xicheng Ying’an being Mr. Lv Yuhua. None of the limited partners held more than one-third of the interest in each limited partnership.

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Upon the establishment of the limited partnerships, on February 19, 2016, Xicheng Ruijia, Xicheng Ruihe, Xicheng Ruifeng, Xicheng Ruiying, Xicheng Lifeng, and Xicheng Ying’an entered into a series of share transfer agreements with our certain then Shareholders (namely, Shenzhen Ruizhe, Shenzhen Tongda, Jiaye Investment Consultation, Mr. Bu Wenxiang, Mr. Yang Zhongchang and Trade Union) to acquire Shares from those Shareholders at par value per Share. Details of each of the share transfers are set forth below:

Shareholding Number of transferred share in our total Aggregate Name of transferee(s) Name of transferor(s) transferred share capital consideration (%) (RMB)

Xicheng Ruijia Shenzhen Ruizhe, 12,259,698 11.01% 12,259,698 Shenzhen Tongda, Jiaye Investment Consultation and Mr. Bu Wenxiang

Xicheng Ruihe Shenzhen Ruizhe, 15,567,362 13.99% 15,567,362 Shenzhen Tongda, Jiaye Investment Consultation, Shenzhen Changrui and Mr. Yang Zhongchang

Xicheng Ruifeng Jiaye Investment 926,122 0.83% 926,122 Consultation

Xicheng Ruiying Jiaye Investment 463,061 0.42% 463,061 Consultation

Xicheng Ruijia, Xicheng Trade Union 57,373,990 51.55% 57,373,990 Ruihe, Xicheng Ruifeng, Xicheng Ruiying, Xicheng Lifeng, and Xicheng Ying’an

Upon completion of aforesaid share transfers on February 19, 2016, our Company became owned as to approximately 25.98% by Xicheng Ruijia, 23.00% by Xicheng Ruihe, 22.21% by Centralcon Capital, 15.27% by Xicheng Ruifeng, 11.22% by Xicheng Ruiying, 1.41% by Xicheng Lifeng and 0.92% by Xicheng Ying’an.

–113– THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. HISTORY, REORGANIZATION AND CORPORATE STRUCTURE

On March 10, 2016, Xicheng Ruijia, Xicheng Ruihe, Xicheng Ruifeng, Xicheng Ruiying, Xicheng Lifeng, Xicheng Ying’an and Nanjing Gaoke Xinjun Chengzhang No.1 Equity Investment Partnership (Limited Partnership) (南京高科新浚成長一期股權投資合夥企業（有限合夥）)(“Nanjing Gaoke”), with its principal business in equity investment and provision of entrepreneurship management service to entrepreneurs and being an Independent Third Party, entered into an investment agreement, pursuant to which Xicheng Ruijia, Xicheng Ruihe, Xicheng Ruifeng, Xicheng Ruiying, Xicheng Lifeng and Xicheng Ying’an agreed to transfer a total of 5,565,378 Shares, representing approximately 5% (of which 0.92% from Xicheng Ruijia, 0.81% from Xicheng Ruihe, 0.54% from Xicheng Ruifeng, 0.40% from Xicheng Ruiying, 1.41% from Xicheng Lifeng and 0.92% from Xicheng Ying’an) of our share capital (being RMB111,307,559 at the time of such transfer) to Nanjing Gaoke at a total consideration of RMB105,000,000, which was determined after arm’s length negotiations between the parties with reference to net profit and the price-earnings ratio of our Company at the time of such transfer. Upon completion of such share transfer, our Company became owned as to approximately 25.05% by Xicheng Ruijia, 22.21% by Centralcon Capital, 22.19% by Xicheng Ruihe, 14.73% by Xicheng Ruifeng, 10.82% by Xicheng Ruiying and 5.00% by Nanjing Gaoke.

On March 16, 2017, Xicheng Ruijia, Xicheng Ruihe, Xicheng Ruifeng, Xicheng Ruiying, Centralcon Capital and Shanghai Luyuan Investment Management Center (Limited Partnership) (上海麓源投資管理中心（有限合夥）)(“Shanghai Luyuan”) entered into a share transfer agreement, pursuant to which Xicheng Ruijia, Xicheng Ruihe, Xicheng Ruifeng, Xicheng Ruiying and Centralcon Capital agreed to transfer a total of 3,210,606 Shares, representing approximately 2.88% (of which 0.76% from Xicheng Ruijia, 0.67% from Xicheng Ruihe, 0.45% from Xicheng Ruifeng, 0.33% from Xicheng Ruiying, 0.67% from Centralcon Capital) of our total share capital (being RMB111,307,559 at the time of such transfer) to Shanghai Luyuan at a total consideration of RMB62,015,578, which was determined after arm’s length negotiations between the parties with reference to net profit and the price-earnings ratio of our Company at the time of such transfer. Shanghai Luyuan is primarily engaged in investment related management and consultancy, asset management, corporate management consultancy and business consultancy and is an Independent Third Party. Upon completion of such share transfer, our Company became owned as to approximately 24.29% by Xicheng Ruijia, 21.53% by Centralcon Capital, 21.52% by Xicheng Ruihe, 14.28% by Xicheng Ruifeng, 10.49% by Xicheng Ruiying, 5.00% by Nanjing Gaoke and 2.88% by Shanghai Luyuan.

On August 25, 2017, the Shareholders’ general meeting of our Company approved to reassess and reprice the of Yiying Community Acquisition using the cost approach on the basis of prudent consideration, as well as to consequently reduce our registered share capital to RMB81,544,000. The aforesaid reduction of registered share capital was filed with Shenzhen Administration for Market Regulation on December 25, 2017.

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On January 22, 2018, Xicheng Ruijia, Xicheng Ruihe, Xicheng Ruifeng, Xicheng Ruiying, Centralcon Capital, Shanghai Luyuan and Chengdu Shengmei Tongying Investment Partnership (Limited Partnership) (成都市盛美同贏投資合夥企業（有限合夥）) (“Shengmei Tongying”) entered into a share purchase agreement, pursuant to which Xicheng Ruijia, Xicheng Ruihe, Xicheng Ruifeng, Xicheng Ruiying, Centralcon Capital and Shanghai Luyuan agreed to transfer a total of 9,244,191 Shares, representing approximately 11.34% (of which 2.04% from Xicheng Ruijia, 1.47% from Xicheng Ruihe, 1.72% from Xicheng Ruifeng, 1.19% from Xicheng Ruiying, 2.04% from Centralcon Capital and 2.88% from Shanghai Luyuan) of our total share capital (being RMB111,307,559 at the time of such transfer) to Shengmei Tongying at a total consideration of RMB272,074,689, which was determined after arm’s length negotiations between the parties with reference to net profit and the price-earnings ratio of our Company at the time of such transfer. Shengmei Tonging is primarily engaged in investment and asset management, and is an Independent Third Party. Upon completion of such share purchase, our Company became owned as to approximately 22.14% by Xicheng Ruijia, 19.79% by Xicheng Ruihe, 19.49% by Centralcon Capital, 12.67% by Xicheng Ruifeng, 9.57% by Xicheng Ruiying, 5.00% by Nanjing Gaoke and 11.34% by Shengmei Tongying.

On March 2, 2018, Nanjing Gaoke and Shengmei Tongying entered into a share purchase agreement, pursuant to which Nanjing Gaoke agreed to transfer 4,077,200 Shares, representing 5% of our total share capital, to Shengmei Tongying at a consideration of RMB128,400,000, which was determined after arm’s length negotiations between the parties with reference to net profit and the price-earnings ratio of our Company at the time of such transfer. Upon completion of such transfers, our Company became owned as to approximately 22.14% by Xicheng Ruijia, 19.79% by Xicheng Ruihe, 19.49% by Centralcon Capital, 16.34% by Shengmei Tongying, 12.67% by Xicheng Ruifeng and 9.57% by Xicheng Ruiying.

On April 29, 2021, Shengmei Tongying and Country Garden Services entered into a share transfer agreement, pursuant to which Shengmei Tongying transfered its 13,321,391 Shares of our Company to Country Garden Services at a consideration of RMB540 million. For details of such transfer, please see “Pre-[REDACTED] Investment” in this section.

Acting in Concert Arrangement

On March 15, 2021, our Ultimate Controlling Shareholders executed the acting in concert agreement (“Acting in Concert Agreement”), pursuant to which our Ultimate Controlling Shareholders had agreed and confirmed, among other things, from March 2016 (which was the time when they became the beneficial owners of our Company) by acting as the general partners or limited partners, as the case may be, in Xicheng Ruifeng, Xicheng Ruihe, Xicheng Ruijia, Xicheng Ruiying and any other future entities controlled by our Ultimate Controlling Shareholders, that they had been and would continue to be parties acting in concert. On April 20, 2021, Xicheng Rui’an was established for the purpose of implementing the employee stock ownership plan. As Xicheng Rui’an is controlled by Mr. Chen Yaozhong (acting as the general partner), Xicheng Rui’an is also subject to the terms as contemplated under the Acting in Concert Arrangement. Please refer to “Acting In Concert Arrangement” in the section headed “Relationship with Controlling Shareholders” in this document for further details.

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In accordance with the partnership agreements entered into by and among all partners of each Xicheng Ruijia, Xicheng Ruihe, Xicheng Ruifeng and Xicheng Ruiying. (as amended, supplemented and restated from time to time), the general partners of each limited partnership will follow instructions made by our Ultimate Controlling Shareholders when exercising voting rights at the general meetings of our Company.

Our Company, both directly and through its branch offices, has been engaged in provision of property management services and other related value-added services in the PRC over 20 years.

Our Major Subsidiaries

Shenzhen Shenchangcheng

Shenzhen Shenchangcheng was established in the PRC on August 7, 2009 as a limited liability company with an initial registered capital of RMB5,000,000. Since its establishment, Shenzhen Shenchangcheng has been a wholly-owned subsidiary of our Company and has been engaged in the provision of property management services.

On December 21, 2015, the registered capital of Shenzhen Shenchangcheng was increased from RMB5,000,000 to RMB15,000,000.

Changcheng Louyu Technology

Changcheng Louyu Technology was established in the PRC on May 18, 2004 as a limited liability company with an initial registered capital of RMB1,000,000. Upon its establishment, Changcheng Louyu Technology was owned as to 90% by our Company and 10% by Changcheng Elevator, our wholly-owned subsdiary. Since its establishment, Changcheng Louyu Technology has been engaged in electrical engineering.

On June 20, 2006, the registered capital of Changcheng Louyu Technology was increased from RMB1,000,000 to RMB5,000,000. Upon completion of such increase of registered capital, Changcheng Louyu Technology remained owned as to 90% by our Company and 10% by Changcheng Elevator.

On November 24, 2006, Changcheng Elevator and our Company entered into an equity transfer agreement, pursuant to which Changcheng Elevator agreed to transfer its entire equity interest in Changcheng Louyu Technology to our Company at a consideration of RMB587,759, which was determined after arm’s length negotiations between the parties with reference to the net asset value of Changcheng Louyu Technology at the time of such transfer. Upon completion of such equity transfer, Changcheng Louyu Technology became wholly owned by our Company.

On October 23, 2013, the registered capital of Changcheng Louyu Technology was further increased from RMB5,000,000 to RMB10,000,000 and Changcheng Louyu Technology remained wholly owned by our Company.

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REORGANIZATION

The following diagram illustrates our shareholding structure before the Reorganization.

Xicheng Ruijia(1)(8) Xicheng Ruihe(2)(8) Xicheng Ruifeng(5)(8) Xicheng Ruiying(6)(8) Centralcon Capital(3) Shengmei Tongying(4) (PRC) (PRC) (PRC) (PRC) (PRC) (PRC)

22.14% 19.79% 12.67% 9.57% 19.49% 16.34%

Our Company (PRC)

100% 100% 100%

Shenzhen Changcheng Louyu (7) Shenchangcheng Technology Other subsidiaries (PRC) (PRC) (PRC)

Notes:

(1) The general partner of Xicheng Ruijia is Mr. Ma Xingwen, our non-executive Director and one of the Ultimate Controlling Shareholders and the limited partners are our then employees and former employees.

(2) The general partner of Xicheng Ruihe is Mr. Chen Yaozhong, our executive Director and one of the Ultimate Controlling Shareholders and the limited partners are our then employees and former employees.

(3) Centralcon Capital is beneficially controlled by Centralcon Holding, whose shares are listed on the SZSE (Stock code: 000042).

(4) Shengmei Tongying was owned as to (i) 14.78% by Guangdong Yifu Investment Consulting Co., Ltd. (廣東益富投資諮詢有限公司), which was in turn wholly owned by Ms. Su Meiying, (ii) 83.13% by Guangdong Changying Investment Consulting Co., Ltd. (廣東常盈投資諮詢有限公司), which was in turn owned as to 82.22% by Ms. Huang Jiahui (黄嘉慧) and 17.78% by Ms. Su Meiying (蘇美影), (iii) 2.06% by Guangdong Fuyi Investment Consulting Co., Ltd. (廣東富益投資諮詢有限公司), which was in turn wholly owned by Ms. Huang Jiahui (黄嘉慧), and (iv) 0.02% by Shanghai Qiansheng Investment Management Enterprise (Limited Parntership) (上海虔盛投資管理企業（有限合夥）), which was owned by Independent Third Parties. Each of the shareholders of Shengmei Tongying is an Independent Third Party.

(5) The general partner of Xicheng Ruifeng is Mr. Liang Zhijun, our executive Director and one of the Ultimate Controlling Shareholders and the limited partners are our then employees and former employees.

(6) The general partner of Xicheng Ruiying is Mr. Lv Yuhua, our executive Director and one of the Ultimate Controlling Shareholders and the limited partners are our then employees and former employees.

(7) See “Statutory and General Information—A. Further Information about Our Group—6. Particulars of our subsidiaries” in Appendix VII to this document for details.

(8) See “Acting In Concert Arrangement” in the section headed “Relationship with Controlling Shareholders” in this document for details of relationship and acting in concert among our Ultimate Controlling Shareholders.

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In preparation for the [REDACTED], our Group underwent the following reorganization steps:

Acquisition of 100% equity interest in Foshan Chengjiruishang

Foshan Chengjiruishang is principally engaged in leasing, management of property as well as property related consultancy services. For the purpose of achieving clear business delineation between our Group and our Controlling Shareholders upon [REDACTED], on March 25, 2021, our Company entered into an equity transfer agreement with Shenzhen Jiaye Investment, pursuant to which Shenzhen Jiaye Investment agreed to transfer its entire equity interest in Foshan Chengjiruishang to our Company at a consideration of RMB109,256,000, which was determined after arm’s length negotiations between the parties with reference to appraised asset value of Foshan Chengjiruishang as of December 31, 2020 assessed by an Independent Third Party valuer using the income approach. The consideration was fully settled on May 10, 2021. Upon completion of such equity transfer, Foshan Chengjiruishang became our wholly-owned subsidiary. For details of Shenzhen Jiaye Investment, please refer to “Our Corporate Development—Our Company” above and the section headed “Relationship with Controlling Shareholders—Other Businesses Invested by our Ultimate Controlling Shareholders.”

Adoption of Employee Stock Ownership Plan 2021

In order to retain talent for achieving our strategic and operational goals, on April 28, 2021, our Shareholders passed a resolution approving the adoption of an employee stock ownership plan. For the purpose of implementing such, Xicheng Rui’an was established and the share capital of our Company increased from RMB81,544,000 to RMB87,212,834 as a result of the additional capital contribution of RMB44,103,529 made by Xicheng Rui’an. The amount of such capital contribution was paid up in cash on April 30, 2021. Upon completion of such increase of share capital, our Company became owned as to approximately 20.70% by Xicheng Ruijia, 18.50% by Xicheng Ruihe, 11.85% by Xicheng Ruifeng, 8.95% by Xicheng Ruiying, 6.5% by Xicheng Rui’an, 18.22% by Centralcon Capital and 15.28% by Country Garden Services.

The general partner of Xicheng Rui’an was Mr. Chen Yaozhong, our executive Director and one of the Ultimate Controlling Shareholders, and the limited partners consisted of 46 employees of our Company, including three executive Directors (namely, Mr. Liang Zhijun, Mr. Lv Yuhua and Mr. Yin Shanfeng), three supervisors (namely, Mr. Wang Junling, Mr. Zhang Zhi and Mr. Yu Songdong), and six senior management members (namely, Mr. Cao Kelong, Mr. Fan Zhiwei, Mr. Jiang Wei, Mr. He Shuang, Mr. Zheng Haoyuan, and Mr. Xiao Jiarui), and other employees of our Group as of the Latest Practicable Date. For details of the shareholding structure of Xicheng Rui’an, please see Note 9 of the diagram illustrating our shareholding structure after the Reorganisation and immediately before the [REDACTED] in this section.

Our PRC Legal Advisor has confirmed that all necessary filings and registrations with the relevant PRC authorities in respect of the Reorganization had been completed and all applicable regulatory approvals had been obtained as of the Latest Practicable Date.

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PRE-[REDACTED] INVESTMENT

The table below set forth a summary of the details of the Pre-[REDACTED] Investment:

Name of investor: Country Garden Services

Date of share transfer agreement: April 29, 2021

Date of full settlement of May 13, 2021 investment:

Amount of investment (RMB): 540,000,000

Basis of determination of the Determined after arm’s length negotiations consideration: between the parties with reference to the general prospects of the property management industry, our potential growth, profitability, the net assets per Share.

Discount over mid-point of the [REDACTED]% [REDACTED] (assuming no exercise of the [REDACTED] ):

Approximate shareholding in our 15.28% Company upon completion of the Pre-[REDACTED] Investment:

Approximate shareholding in our [REDACTED]% Company upon completion of the [REDACTED] (assuming no [REDACTED] is exercised):

Use of proceeds: N/A

Strategic benefits: Our Directors are of the view that the Pre-[REDACTED] investment demonstrated investor’s confidence in the operation and development of the Group and served as an endorsement of our Group’s performance and prospects.

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Lock-up: Pursuant to the applicable PRC law, within the 12 months following the [REDACTED], all current Shareholders (including the Country Garden Services) could not dispose of any of the Shares held by them.

Special rights: None

Information on Country Garden Services

Country Garden Services was established in the PRC on April 19, 2004 as a limited liability company with registered capital of RMB360,000,000 and is owned as to 50% by Foshan Country Garden Management Services Co., Ltd. (佛山市碧桂園管理服務有限公司) and 50% by Foshan Country Garden Management Consulting Co., Ltd. (佛山市碧桂園管理顧問有限公司), both wholly owned by Country Garden Services Holdings Company Limited (碧桂園服務控股有限公司), a property management company incorporated in Cayman Islands with limited liability and listed on the Stock Exchange (Stock Code: 6098). Country Garden Services is principally engaged in property management and consulting services related to property management.

Save as disclosed above in this section and the sections headed “Substantial Shareholders” and “Connected Transaction”, to our Directors’ best knowledge, information and belief, Country Garden Services is an Independent Third Party and had no other past or present relationship (including business, family, employment, financing, trust or otherwise) with our Group, our substantial Shareholders, Directors, senior management or any of their respective associates as of the Latest Practicable Date.

Public Float

The Shares held by the Country Garden Services will be converted into H Shares and [REDACTED] following the completion of the [REDACTED] and the Conversion of Domestic Shares into H Shares. As Country Garden Services is a core connected person of our Company, the Shares held by Country Garden Services will not be considered as part of the public float for the purpose of Rule 8.08 of the Listing Rules after [REDACTED].

Joint Sponsors’ Confirmation

The Joint Sponsors confirm that, based on the documents provided by the Company relating to the Pre-[REDACTED] Investment, the Pre-[REDACTED] Investment is in compliance with the Interim Guidance on Pre-[REDACTED] Investments (HKEx-GL29-12) and the Guidance on Pre-[REDACTED] investments (HKEx-GL43-12).

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CORPORATE STRUCTURE AFTER THE COMPLETION OF THE REORGANIZATION AND IMMEDIATELY BEFORE THE [REDACTED]

The following diagram illustrates our shareholding structure after the Reorganization and immediately prior to the [REDACTED]:

Xicheng Ruijia(1)(8) Xicheng Ruihe(2)(8) Xicheng Ruifeng(5)(8) Xicheng Ruiying(6)(8) Xicheng Rui’an(9) Centralcon Capital(3) Country Garden (PRC) (PRC) (PRC) (PRC) (PRC) (PRC) Services(4)

20.70% 18.50% 11.85% 8.95% 6.50% 18.22% 15.28%

Our Company (PRC)

100%100% 100% 100%

Shenzhen Changcheng Louyu (7) Foshan Shenchangcheng Technology PRC subsidiaries Chengjiruishang (PRC) (PRC) (PRC) (PRC)

Notes:

(1) As of the Latest Practicable Date, Xicheng Ruijia was owned as to approximately 40.02% by Mr. Ma Xingwen, being our non-executive Director, 3.57% by Mr. Chen Yaozhong, being our executive Director, 1.11% by Mr. Zhang Zhi, being our supervisor, 4.83% by Mr. Fan Zhiwei, 4.31% by Mr. Zheng Haoyuan, 0.10% by Mr. Xiao Jiarui, each being our senior management, and 46.06% by our existing employees or former employees. Mr. Ma Xingwen is the general partner of Xicheng Ruijia and the remaining individuals are the limited partners.

(2) As of the Latest Practicable Date, Xicheng Ruihe was owned as to approximately 35.02% by Mr. Chen Yaozhong, being our executive Director, 2.59% by Mr. Ma Xingwen, being our non-executive Director, 1.05% by Mr. Xiao Jiarui, 0.45% by Mr. Fan Zhiwei, each being our senior management and 60.89% by our existing employees or former employees. Mr. Chen Yaozhong is the general partner of Xicheng Ruihe and the remaining individuals are the limited partners.

(3) Centralcon Capital is beneficially controlled by Centralcon Holding, whose shares are listed on the SZSE (Stock code: 000042).

(4) Country Garden Services is our Pre-[REDACTED] Investor, and is beneficially controlled by Country Garden Services Holdings Company Limited, an Independent Third Party.

(5) As of the Latest Practicable Date, Xicheng Ruifeng was owned as to approximately 16.00% by Mr. Liang Zhijun, 1.33% by Mr. Lv Yuhua, each being our executive Director, 13.55% by Mr. Cao Kelong, 7.98% by Mr. He Shuang, 0.51% by Mr. Jiang Wei, each being our senior management, 4.65% by Mr. Wang Junling, being our Supervisor, and 55.98% by our existing employees or former employees. Mr. Liang Zhijun is the general partner of Xicheng Ruifeng and the remaining individuals are the limited partners.

(6) As of the Latest Practicable Date, Xicheng Ruiying was owned as to approximately 20.90% by Mr. Lv Yuhua, 1.46% by Mr. Liang Zhijun, each being our executive Director, 10.52% by Mr. Jiang Wei, 1.39% by Mr. Cao Kelong, each being our senior management, and 65.73% by our existing employees or former employees. Mr. Lv Yuhua is the general partner of Xicheng Ruiying and the remaining individuals are the limited partners.

(7) See “Statutory and General Information—A. Further Information about Our Group—6. Particulars of our subsidiaries” in Appendix VII to this document for details.

(9) As of the Latest Practicable Date, Xicheng Rui’an was owned as to approximately 11.52% by Mr. Chen Yaozhong, 5.98% by Mr. Lv Yuhua, 5.85% by Mr. Liang Zhijun and 3.27% by Mr. Yin Shanfeng, each being our executive Director, 5.06% by Mr. Cao Kelong, 4.43% by Mr. Fan Zhiwei, 4.34% by Mr. Jiang Wei, 4.25% by Mr. He Shuang, 4.24% by Mr. Zheng Haoyuan, 3.50% by Mr. Xiao Jiarui, each being our senior management, 3.84% by Mr. Wang Junling, 3.52% by Mr. Zhang Zhi, 3.27% by Mr. Yu Songdong, each being our Supervisor, and 36.93% by our existing employees. Mr. Chen Yaozhong is the general partner of Xicheng Rui’an and the remaining individuals are the limited partners.

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CORPORATE STRUCTURE AFTER THE [REDACTED]

The following diagram illustrates our shareholding structure immediately following the [REDACTED] (assuming the [REDACTED] is not exercised):

(1)(8) (2)(8) (5)(8) (6)(8) (9) (3) Country Garden Xicheng Ruijia Xicheng Ruihe Xicheng Ruifeng Xicheng Ruiying Xicheng Rui’an Centralcon Capital Services(4) Public shareholders (PRC) (PRC) (PRC) (PRC) (PRC) (PRC) (PRC)

[REDACTED] [REDACTED] [REDACTED] [REDACTED] [REDACTED] [REDACTED] [REDACTED] [REDACTED]

Our Company (PRC)

100%100% 100% 100%

Shenzhen Changcheng Louyu (7) Foshan Shenchangcheng Technology PRC subsidiaries Chengjiruishang (PRC) (PRC) (PRC) (PRC)

Notes:

(3) Centralcon Capital is beneficially controlled by Centralcon Holding, whose shares are listed on the SZSE (Stock code: 000042).

(4) Country Garden Services is a Pre-[REDACTED] Investor of the Company, and is beneficially controlled by Country Garden Services Holdings Company Limited, an Independent Third Party.

(7) See “Statutory and General Information—A. Further Information about Our Group—6. Particulars of our subsidiaries” in Appendix VII to this document for details.

(9) As of the Latest Practicable Date, Xicheng Rui’an was owned as to approximately 11.52% by Mr. Chen Yaozhong, 5.98% by Mr. Lv Yuhua, 5.85% by Mr. Liang Zhijun and 3.27% by Mr. Yin Shanfeng, each being our executive Director, 5.06% by Mr. Cao Kelong, 4.43% by Mr. Fan Zhiwei, 4.34% by Mr. Jiang Wei, 4.25% by Mr. He Shuang, 4.24% by Mr. Zheng Haoyuan, 3.50% by Mr. Xiao Jiarui, each being our senior management, 3.84% by Mr. Wang Junling, 3.52% by Mr. Zhang Zhi and 3.27% by Mr. Yu Songdong, each being our Supervisor, and 36.93% by our existing employees. Mr. Chen Yaozhong is the general partner of Xicheng Rui’an and the remaining individuals are the limited partners.

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You should read this document in its entirety before you decide to invest in the [REDACTED] , and not rely solely on key or summarized information. The financial information in this section has been extracted without material adjustment from the Accountant’s Report set out in Appendix I to this document. All market statistics quoted in this document, unless otherwise specified, are from the CIA Report. For the qualifications of CIA as well as details of the industry report, see “Industry Overview” in this document.

OVERVIEW

We have established a nationwide service network. Established in Shenzhen in 1993, we have been strategically expanding across China since 1999 when we first expanded our business to Beijing and became one of the first-movers in nationwide expansion among property management service providers in China. As of March 31, 2021, our project portfolio encompassed projects located in 162 cities across 31 provinces, municipalities and autonomous regions in China, with 62.4% of our GFA under management located in tier-one or new tier-one cities. In addition to wide geographical presence, our project portfolio comprises a diverse range of property types, including residential properties, commercial complexes, office buildings, transportation hubs, schools, hospitals, and other public facilities such as exhibition centers and city parks. In particular, we manage a number of world-class venues or properties, such as the Olympic Village for the 2008 Beijing Olympics and the Chongli venues of the 2022 Beijing Winter Olympics.

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We do not rely on any affiliated property developer and therefore, market competitiveness has been the key driver of our success since our inception. As we have to compete for projects on the open market, we strive to develop keen insights for market trends and customer needs to provide services that are above the expectation of our customers. Our ability to succeed under market competition is testified by our proven track record in obtaining management projects from property developers and owners who are independent from us, and our dedication to customer services and continuing self-improvement has been reflected in our market recognition and customer loyalty.

We believe trust is the key to our success. By establishing strong connection through our community activities, we foster trust with our customers, enhance their satisfaction with our services, and encourage them to support our work and engage us for other value-added services, thereby improving our operational performance. We are also dedicated to the research and development of smart integrated operation platform as well as implementing technological solutions in providing services to the communities. Through technology, we have been able to reduce costs, improve services quality and enhance operational efficiency.

We are widely recognized in the industry and have received numerous awards and accolades. We have been ranked one of the top ten among the Top 100 Property Management Companies in terms of overall strength by CIA for 13 years. We were ranked first by CIA among the 2021 Leading Property Management Companies in China in terms of level of independent operation (市場化運營水平). According to CIA, our brand value exceeded RMB7.0 billion, and our brand was one of the Top 50 most valuable brands among property management service enterprises in China. Our brand was also recognized as a Shenzhen Top Brand (深圳知名品牌) by the Shenzhen Top Brand Evaluation Committee (深圳知名品牌評價委員會). We were recognized as the 2020 Shenzhen Top 100 Industry Leaders (深圳行業領袖企業100強) by the Shenzhen Industry Leader Corporate Development Promotion Association (深圳市行業領袖企業發展促進會) and Shenzhen Economic Daily (深圳商報).

During the Track Record Period, we provided the following services to our customers: (i) property management services, primarily comprising cleaning, security, greening and landscaping and repair and maintenance services; (ii) value-added services to property developers, primarily comprising sales office management services; (iii) community value-added services, primarily comprising space management services, community shopping services, home-living services and car parks management services; and (iv) professional services, primarily comprising construction and installation engineering services, elevator related services and smart integrated operation platform services.

We achieved robust growth during the Track Record Period. In 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, our revenue was RMB2,404.3 million, RMB2,810.3 million, RMB3,035.6 million, RMB693.2 million and RMB783.8 million, respectively.

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COMPETITIVE STRENGTHS

We believe that the following strengths contribute to our leading market position, ensure our success and distinguish us from our competitors:

The Largest Independent Comprehensive Property Management Service Provider in China

We are the largest independent comprehensive property management service provider in China, with an operating history of more than 28 years and extensive experience in managing world-class projects. According to CIA, we are the only independent property management company among the Top 10 Property Management Companies in China in 2021, according to CIA. As of March 31, 2021, we had 708 projects under management and 855 projects contracted for management, with a total GFA under management of 114.6 million sq.m. and a total contracted GFA of 152.8 million sq.m., serving approximately three million property owners and residents. We also had 130 projects with a total GFA under management by our joint ventures of 59.3 million sq.m. as of March 31, 2021. As well as ranking the first among all independent property management companies in China in terms of GFA under management, contracted GFA and revenue as of or for the year ended December 31, 2020.

We do not rely on any affiliated property developer and therefore, market competitiveness has been the key driver of our success since our inception. As we have to compete for projects on the open market, we strive to develop keen insights for market trends and customer needs to provide services that are above the expectation of our customers. Our ability to succeed under market competition is testified by our proven track record in obtaining management projects from property developers and owners who are independent from us, and our dedication to customer services and continuing self-improvement has been reflected in our market recognition and customer loyalty.

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We are widely recognized in the industry and have received numerous awards and accolades. We have been ranked one of the top ten among the Top 100 Property Management Companies in terms of overall strength by CIA for 13 years. We were ranked first by CIA among the 2021 Leading Property Management Companies in China in terms of level of independent operation (市場化運營水平). According to CIA, our brand value exceeded RMB7.0 billion, and our brand was one of the Top 50 most valuable brands among property management service enterprises in China. Our brand was also recognized as a Shenzhen Top Brand (深圳知名品牌) by the Shenzhen Top Brand Evaluation Committee (深圳知名品牌評價委員會). We were recognized as the 2020 Shenzhen Top 100 Industry Leaders (深圳行業領袖企業100強) by the Shenzhen Industry Leader Corporate Development Promotion Association (深圳市行業領袖企業發展促進會) and Shenzhen Economic Daily (深圳商報).

Strong Expansion Capabilities through Effective Marketing and Multi-dimensional Business Development Model

We have established an all-staff, four-tier marketing system at the headquarter, region, city and project levels. From decades of experience competing in the market, we have developed strong capabilities in market trends and dynamics analysis, customer needs prediction, service innovation, customized solution design, and service operations management, which are key to enhancing our competitiveness.

Leveraging our first-class reputation within the industry, extensive experience in property management services, effective marketing and multi-dimensional business development model, we continue to expand and diversify our project portfolio for both residential and non-residential properties.

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Through organic business development, we have established a nationwide marketing system across different marketing channels. Specifically:

• Marketing system: different from property management companies affiliated with property developers which typically focus on specific regions based on the property developers’ area of focus, we have established a broad marketing system and formulated marketing plans for 6 major regions, 25 city clusters and 177 key cities. In addition, we have a large client base of corporate and institutional customers (including property developers, government authorities and property owners’ associations). The number of our corporate and institutional customers had reached 495 as of March 31, 2021;

• Marketing strategy: leveraging our inhouse-trained marketing team and flexible expansion strategies, we carry out a combination of strategic cooperation and opportunity-driven marketing efforts targeted at large cities (so as to increase the density of our projects in tier-one and new tier-one cities), large customers and large properties with multi-types of properties;

• Marketing team: we have established a professional and dedicated business development and marketing team and formulated marketing expansion strategies. We organize marketing trainings on a regular basis. As of March 31, 2021, our business development and marketing team consisted of over 300 members; and

• Marketing network: in terms of geographical coverage, we have a sales network covering six major regions and 60 cities across the PRC. We strive to enhance our brand awareness and brand value through high quality services and concentrated operations.

We also adopt multi-dimensional marketing channels to strengthen our cooperation with customers, including:

• Strategic cooperation with key customers: We have formed a key-customer business division with dedicated management service systems for large-scale customers such as Huawei, Ping An, Tencent, China Coal Group, Shandong Luneng Group, China National Real Estate Development Group and Shanghai Kaitai Property Development Ltd. (上海愷泰房地產開發有限公司).

• Joint ventures: We form joint ventures with state-owned enterprises and government investment platforms to undertake property management service projects, with a focus on public and government facilities. Our notable joint venture partners include China Nuclear E&C Group, TCL Group, Ningxia Construction Investment Group (寧夏建投), Zhuzhou City Construction (株洲城發), Xiangtan Real Estate Group (湘潭房產集團), Shangrao City Construction (上饒城投), Jining City Construction (濟寧城投) and Wuhan Airport Economic Development Zone Industrial Development Investment Ltd. (武漢工發投).

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• Government public tenders: We participate in tender and bidding processes organized by governments with an aim to obtain property management projects for government and public facilities including government office buildings (such as the office buildings of State Taxation Administration and Shangrao Administration Service Center), transportation hubs (such as Chongqing Jiangbei Airport Terminal, Hefei Metro Line 3), hospitals (such as Jinling Hospital, Nanjing University School of Medicine) and tertiary institutions (such as Tianjin University of Science and Technology).

• Property owners’ associations tenders: We have established a comprehensive cooperation channel with property owners’ associations and related organizations and participate in tender and bidding processes organized by property owners’ associations.

• All-staff marketing system: In addition to our sales and marketing personnel, we encourage all of our staff members to participate in customer outreach activities to support our marketing efforts and reward such staff members for new businesses that they helped to generate. In 2020, our non-marketing personnel contributed to approximately 25% of the new projects we obtained.

As a result of our marketing activities, in 2018, 2019, 2020 and the three months ended March 2021, we obtained new contracted GFA of 19.3 million sq.m., 37.3 million sq.m., 27.7 million sq.m. and 4.1 million sq.m, respectively.

Outstanding Operational Capabilities Underpinned by Deep Connections with Customers and Effective Management Systems

We uphold the corporate culture of “subjective altruism (benefiting our employees, customers and business partners), and in turn benefiting ourselves (shareholders) 「主觀利他（員工、客戶和事業夥伴），順帶利己（股東）」”, and strive to become a leader in community lifestyle. We look forward to constructing a “heart-to-heart” bridge among residents in our communities with our sincerest effort, turning a “stranger community” into an “acquaintance community” so as to create harmonious interpersonal relationships within the community and develop trust among members of the community. In particular,

• Sunshine property management model (陽光物管模式): We launched the sunshine property management model (which emphasizes the transparency of financial systems, management and service procedures) in 2003, and rolled out such model nationwide. As of March 31, 2021, we had adopted the sunshine property management model in 71 projects under our management.

• Yiying Qingteng volunteering activities (一應青藤): We have established Yiying Qingteng Work Committee (一應青藤工作委員會) and volunteer service organizations to organize community welfare activities. As of March 31, 2021, we had completed more than 100 community welfare projects, established over 470 community organizations and recruited more than 18,000 volunteers. From December 2019 (when we first started to record volunteering hours) until March 31, 2021, volunteers from Yiying Qingteng community organizations completed over 89,000 hours of community welfare services.

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• Neighbors Heart to Heart (十家連心): Since May 2020, we have been organizing discussion sessions and other community events for property owners to provide a communication platform to and provide an opportunity neighbours to become acquaintances address their practical concerns. We collect feedbacks from property owners and residents, respond to their concerns and provide solutions to their problems. We also organize community activities to establish connection and trust among our staff and residents in our communities to further enhance customer satisfaction with our services, and thereby increasing the collection rate of our property management fees. As of March 31, 2021, we had organized more than 6,500 Neighbors Heart to Heart sessions, covering over 400 communities with more than 46,000 participating property owners.

We believe trust is the key to our success. By establishing strong connection through our community activities, we foster trust with our customers, enhance their satisfaction with our services, and encourage them to support our work and engage us in other value-added services, thereby improving our operational performance. For example, in 2020 we implemented enhanced community programs in 36 properties that had historically been difficult to manage. After the implementation of these programs, 30 out of 36 properties showed a significant improvement in property management fee collection rate, and the average property management fee collection rate for these 36 properties increased from 55.2% in 2019 to 65.5% in 2020.

We have an outstanding quality management system. In 1997, we passed the ISO9002 quality system certification. We built up a systematic assessment scheme on customer satisfaction, and became one of the first 18 enterprises to be awarded the “First-class Qualification in Property Management” in Shenzhen. In 2002, we applied for the national quality prize and became the first batch of property management companies to be awarded the “National First-class Qualification” by the Ministry of Construction. We have established a full set of standardized system for property management supported by information technologies, while taking the lead in advocating the concept of “Property Cloud 「物業雲」”. We put forward the “Amoeba Program 「阿米巴計劃」” within the Group to achieve the flattening of management on organization structure, information and operation procedures and so on, which achieved effective cost control. In 2015, we reformed and upgraded our IT system with technologies of mobile internet and community IoT, and we introduced the “EINYUN Cloud Smart Platform for Community Services「一應雲智慧社區服務平台」” to the industry, based on which we took the lead in implementing grid management, while carrying out precise, refined and accurate management.

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High Service Quality and Operational Efficiency through Implementation of Technological Solutions

We are dedicated to the research and development of smart integrated operation platform as well as implementing technological solutions when providing services to the communities. Technology empowers our services, reduces costs, improves service quality and enhances operational efficiency. Through the exploration and operation of living service scenarios, we perceive, analyze and predict property owners' community living needs on a real-time basis, and provide tailored services to improve the living experience of property owners. In particular, we primarily rely on three technology systems:

• EINYUN Cloud Smart Platform Back End Management System (一應雲智慧平台後端管理系統): Through our continuous investment in research and development and the deployment of advanced technologies, we possess industry-leading technological capabilities and service capabilities under various scenarios. Based on cloud computing and mobile internet, we have created and applied a series of differentiated, scenario-based and intelligent products and services in the areas of property management services, community operations and smart operation and maintenance of building equipment by leveraging emerging technologies such as big data, artificial intelligence and IoT. Such products and services are built based on a unified master data and business middle platform and are jointly applied in communities under our management to form an ecological smart community living service system. We continuously strive to create a community ecological value chain by connecting property owners and community service providers through operating smart community platform and proactively explore the digital transformation of property management services industry.

• EINYUN Cloud Smart Platform Front End Mobile Application (一應雲智慧平台前端移動應用): Based on various functions provided by EINYUN Cloud Smart Platform Back End Management System, we developed two business front ends facing property owners and frontline staff, thereby connecting our internal management system with customer-end property owners/residents through two mobile applications, namely EINYUN Life (一應生活) and EINYUN Service (一應智能), in order to facilitate our staff to ‘do things well’, ‘serve people well’ and ‘manage money well’.

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• Intelligent operation and maintenance services for building equipment: Through adopting IoT and big data technologies, we digitize business information and work orders for services such as equipment and facility maintenance and repair, and improved our efficiency in the management of and control over the distribution of offline services through online platform. As of March 31, 2021, we had established 17 data operation centers, 18 technical service centers and 20 terminal service centers across the country, thus forming the backbone for the intelligent operation and maintenance services across the country. With an offline professional service team of around 4,000 people and around 1,000 projects under management, we formed regional operation grids with data operation centers as their core, projects under management as their foundation, thereby achieving resource integration and improving operational efficiency and benefiting the surrounding projects. With our intelligent system for building control, we resolved many emergencies involving water and power failure in a timely manner.

Innovative Property Management Industry Alliance to Foster the Growth of A Community Property Management Ecosystem

We have established a property management industry chain alliance, the “EINWIN Cloud Alliance「一應雲聯盟」”, with various property management companies across the country and esteemed partners from other industries.

• Leveraging the EINWIN Cloud Alliance, from the perspective of community services and based on our extensive industrial experience and innovative technologies, we have developed a SaaS smart property management platform, thereby creating a one-stop customized comprehensive solution for industry participants, in order to assist small or medium scale property management companies with digitalization upgrade to cope with the increasingly intense market competition. Our software products and SaaS services include:

– Management digitalization empowerment: Leveraging technologies including AIoT, cloud computing, big data and artificial intelligence, we designed a modular software platform with different solution profiles to realize digitalized and visible information for property management companies. Through the development of the service standardization system combined with big data and AI algorithm capabilities, we gain insights into the service capability factor and business capability factor of the property management company users, so as to provide digitalized and visible information for industry participants, and to optimize the operation process and efficiency in decision-making, thereby lowering operational costs and enhancing the quality of services.

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– Business digitalization empowerment: Built upon our extensive experience and in-depth understanding of the industry and our customers, our products and services range from customer acquisition to estimation on investment and development, from project management to on-site services, thereby assisting our customers in realizing digitalized management of the entire business chain. In addition, we provide consultation services to create a customized digitalized solution for customers and to assist customers in successful digital transformation, by streamlining customers’ business processes with a model involving “platform + customization”.

– One-stop solution: We provide one-stop solutions to property management companies, including areas such as marketing management, investment and business development management, business and financial management, system standardization, basic property management, multi-operational services of communities and community shopping services.

– Our software products and SaaS services business experienced significant growth. In 2018, 2019 and 2020, our revenue from smart integrated operation platform services amounted to nil, RMB16.0 million and RMB32.8 million, respectively. As of March 31, 2021, our software products and SaaS platform had been serving more than 600 EINWIN Cloud Alliance members and other customers.

• In addition, we have established a community management ecosystem of sharing and win-win co-operation. In particular:

– Community shopping services: In 2020, the EINYUN Life (一應生活) mobile application developed by us recorded gross revenue of RMB29.4 million from online transactions involving community shopping services for property owners. In 2020, there were over 200,000 newly registered users. The continuous positive growth in the number of new users and active users of the EINYUN Life during the Track Record Period has laid a solid foundation for user stickiness and repurchases going forward.

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– Alliance purchase: We conduct centralized procurement for our EINWIN Cloud Alliance members to facilitate a stronger bargaining power. As of March 31, 2021, 76 EINWIN Cloud Alliance members procured materials from the alliance purchase platform. Among them, some property management companies shared supply chain with the alliance purchase platform, which reduced our material procurement cost in the same year. Volume of transactions generated by users other than us on alliance purchase platform amounted to RMB0.9 million, RMB3.4 million, RMB39.9 million and RMB0.8 million for 2018, 2019, 2020 and the three months ended March 31, 2021, respectively.

– Public space management: We integrate public spaces such as elevator advertising spaces in our properties under management and the surrounding public spaces for package sale, forming a high-density, high-coverage, high-reach business district. These spaces are jointly leased to advertising companies, so as to maximize the value of public space resources, to utilize economies of scale to create value and promote cooperation between property management companies.

– Sharing of supply chain: We have a dedicated team to manage the product flow, information flow and capital flow of the supply chain on a platform level and conduct planned procurement collectively with other small or medium scale property management companies to bargain with suppliers. The property management companies participating in the centralized purchasing process aggregate the annual quantity of materials to be purchased in the current year based on previous years’ purchasing data. Then, after collecting the data of all property management companies, the alliance procurement team bargains with the suppliers, usually with a satisfying price discount. After the orders are placed, the manufacturers are required to carry out delivery of the materials required by each property management company. Supply chain sharing not only directly brings our EINWIN Cloud Alliance members a more transparent and convenient procurement method, but also optimizes the management of assets, warehouses and cash flow of our EINWIN Cloud Alliance members, thus better enhancing their operation efficiency while reducing cost.

Seasoned, Visionary and Stable Management Team Supported by Effective Human Resources and Incentive Systems

We have a visionary, stable and highly efficient management team. Our senior management team has in-depth insights in the industry characteristics and customer needs, and possesses farsighted and innovative strategic vision. Our senior management team was among the first-movers in the industry to adopt nationwide expansion strategies, to establish exportable community services IT system based on the SaaS model and to create “acquaintance community” ecosystem development strategies stemmed from the Chinese culture.

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We have a robust and efficient human resource system that emphasizes the “selection「選」”, “nurturing「育」”, “retention「留」” and “employment「用」” of talents:

• “Selection「選」”: we have established a competency model for key positions, namely the urban area golden trio, project manager, market development manager and grid manager, in order to ensure that we locate compete talents that meet our business development needs; we encourage more employees to internally recommend talents to us through the “Bole「伯樂」” incentive plan; we adopt the recruiting project of The Gallup Organization that is based on competency and attract talents from the latest generation and employ star employees. In addition, we employ approximately 300 talents from universities across the PRC every year, and provide various support to talents in areas such as remuneration, training system and development opportunities.

• “Nurturing「育」”: we have implemented the “two studies and one practicing 「兩學一做」” scheme and motivated the growth of mental strength and skills of our employees. We have established and developed the Yiying Qingteng online learning platform, formulated a series of talent nurturing and development plans and developed corresponding standardized courses targeting employees at all levels, so as to promote the nurturing of talents for key positions through means such as online learning, offline interaction courses and mobile learning.

• “Retention「留」”: we have formulated a robust performance assessment and incentive system which offers customized career development paths for different types of talents. As of March 31, 2021, over 80% of our management personnel were internally promoted employees. We have an incentive mechanism that allows employees to develop in concert with our Company and share growth results. We established an employee stock ownership scheme in 1998 and became a community of shared destiny with employees since then. As of the Latest Practicable Date, our Employee Stock Ownership Platforms held 66.5% of our Company’s share capital, covering employees ranging from senior management to mid-level core personnel. We have formulated different remuneration structures and different bonus allocation mechanisms for different posts to make sure the growth in total remuneration of employees is linked with the performance growth of our Company. At the same time, we have established a performance assessment system that integrates work performance, values and team management in order to effectively motivate employees’ vitality and passion.

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• “Employment「用」”: We adopt the mechanism of joint assessment and decision making for employment and management of talents to reduce deviations and risks in recruiting. Through the “Talents Upgrading 「人才轉身」” plan, we determine the positioning, requirement on capabilities and experience for major key posts and formulated a series of talent nurturing and development plans for employees at different levels through talent review. For each of the project managers, general managers for urban areas and other key positions such as CEO of business department, we have a talent reserve plan that requires one to two experienced reserves who are ready to assume the position immediately, two current reserves who will be ready to assume the position in the near future and four long-term reserves who are anticipated to be qualify for the position in the long run.

BUSINESS STRATEGIES

Reinforce Our Leading Position in Property Management Industry through Expanding Business Scale

We plan to leverage our nationwide presence and leading market reputation to explore new property types and customers. In addition to maintaining our market position for the management of residential properties, we have been proactively expanding our management scale of other property types. We plan to set up a specialized customer service department to manage our cooperation with strategic customers. Leveraging our efficient resource coordination and transmission capabilities among six major regions across China, and standardized service plug-ins provided by our product departments, we plan to fit our services into various property settings in a rapid and precise manner and achieve growth in our management scope of various types of properties such as office buildings, industrial parks, commercial properties and public service facilities.

We plan to further penetrate in key cities, and strategically expand into other cities by leveraging our brand reputation. We also plan to optimize our nationwide marketing team and channels and achieve growth through our multi-dimensional marketing channels, such as strategic cooperation with key customers, forming joint ventures, cooperation with governments, and participating in tenders organized by property owners’ associations.

In addition to procuring project management contracts in the market, we also intend to further expand our business scale and market share, and diversify the types of properties under our management through acquisitions and investments. Our selection criteria for a potential property management target company include but not limited to: (a) revenue at least RMB50.0 million and (b) net profit excluding extraordinary profit and loss of at least RMB4.0 million in the latest financial year. We will prioritize in assessing potential investments or acquisition targets with a portfolio of managed properties located in tier-one cities, new tier-one cities and/or provincial capitals, with a portfolio of managed properties including residential properties, office buildings and commercial complexes.

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Improve Service Quality and Customer Satisfaction through Community Activities and Adoption of Technological Solutions

We are dedicated to satisfying our customers’ needs. Instead of being satisfied with providing property management services to our customers, we are exploring the possibility of cooperating with different social sectors to further strengthening our operational capacity as a service-oriented organization, so as to provide high-quality value-added services to property owners and occupants.

We strive to integrate business with interpersonal service in order to create a warm, harmonious and peaceful community which is co-built, co-managed and co-used as well as to implement Sunshine property management model (陽光物管模式) and construct a “heart-to-heart” bridge among residents in the community through establishing the “acquaintance community”.

We follow the guiding ideology of “refinement in profession, precision in service and accuracy in operation 「專業精深化、服務精到化、經營精細化」” to develop operational systems for different types of properties. Under the framework of our service systems, we plan to formulate a modularized and standardized working guide for major community service models, which incorporates the best practices from the frontline of our Company and outstanding enterprises inside and outside the industry into our service system; we also plan to continue to identify problems in our service systems through internal management evaluation based on the three dimensions of “commitment, fulfillment and effectiveness 「說到、做到、有效」”. For service products targeting different property types, service types and scenarios, we plan to deconstruct and reconstruct our service systems and prepare corresponding services delivery standard plug-ins to ensure high level of service quality while enhancing service efficiency.

We will continue to optimize and refine our integrated intelligent management operational platform, with an aim to achieve high quality and standardized services through technological empowerment while controlling costs and enhancing operational efficiency. We will make additional investment in upgrading our EINYUN cloud smart platform as well as refining our online service system, so that we would be able to rapidly and effectively handle requests of property owners, and collect and analyze the large volume, diversified and complicated data of property scenarios. We will continue optimizing internal control system and upgrading our business management system, so as to provide managerial and supportive tools to employees and partners across China and optimize cost curves at the same time.

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Diversify Our Service Offerings to Meet Customer Needs

We provide community value-added services, mainly including space management services, community shopping services, home-living services and car parks management services, to property owners and residents in the community by utilizing the EINYUN cloud system. We intend to promote our EINYUN Life (一應生活) mobile application nationwide. We primarily plan to expand our community life service platform to strengthen the connections among property owners (from active expansion of property management business to provision of life services to property owners), thereby refining our innovative service system. We also plan to export the services on our EINYUN Life mobile application, such as community retail, marketplace, housekeeping and home decoration services.

Leveraging our extensive nationwide presence, we plan to further expand our service coverage in targeted regions, and seek partnering with well-established companies with mature business so as to efficiently consolidate their cost-effective supplies (focus on life necessities of “homes, vehicles, people”). We will further build up words of mouth among users by providing end-to-end customers’ values for organizations and families in the community. We strive to secure the highest degree of trust at optimal costs:

• We will make investments to build up a digitized community service operation model. We have been establishing the EINYUN cloud system ecosystem over the past years, and will continue to make investments going forward, targeting to optimize our services and improve our competitiveness and operation efficiency through digital empowerment.

• Leveraging our advanced EINYUN cloud service system and our established reputation, we will keep investing in the creation of “EINYUN Station「一應驛站」” value-added service system in the residential communities, which will serve as the front desk of community services in response to the relevant requests from customers. We will also actively dig into the demands of customers to realize the integration between the public-sector and private-sector services. We plan to leverage “EINYUN Station” not only to provide convenient and efficient community shopping services for customers, but also to precisely provide value-added services with more personalized and professional features for customers located in different communities. For example, we target to match the needs of customers and residents within the properties under our management with professional service suppliers, to provide services such as turnkey furnishing services and pre-move-in cleaning services in newly developed communities, housekeeping services for customers in mature communities, or night-care services for working families.

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Further Develop Technologies and Alliance Platforms to Empower Our Business and Diversify Our Revenue Sources

We plan to promote alliance purchase businesses across the country and collaborate with small and medium scale property management companies to jointly create a sunshine group-procurement platform. Leveraging the bargaining advantages of our centralized procurement system and our capabilities in platform operation and commodity selection, we plan to offer materials with high cost-efficiency to members of EINWIN Cloud Alliance and other property management companies. We plan to further integrate our supply chain, thereby transforming into SaaS-based property management solution platform with lowered costs and increased efficiency to provide value for organizations and families in the community.

We will continue investing in SaaS and export the SaaS+ business, as most of the property management companies develop their businesses from fundamental property management services and thus naturally lack the access to the digital world that is centered on software and data platforms. We will continue investing in and strengthening the functions and performance of the EINYUN cloud smart platform, and undertaking integration based on our cross-regional and large-sample scenario data to cater to a wider range of business scenarios and meet diversified customer needs, thereby providing industry participants with a one-stop solution. We believe that SaaS+, which is a comprehensive output of management system + specific offline scenarios and operating procedures, instead of SaaS, will be the technological export format of property management services.

We have started to build a smart operation and maintenance platform for building equipment, and will continue applying IoT, big data and AI technology to improve work efficiency, support management decision-making and enhance customer experience. Benefitting from our nationwide footprint, our technologies for building facilities and equipment have also been widely used across the country:

• Community asset maintenance: Leveraging our nationwide professional team, coupled with the adoption of the IoT technology, we have installed building control systems in 26 cities across the country, and have built up a network that connects nearly 1,000 elevators together, through which we monitor the operation of community assets in real time.

• Digitalized fire prevention system: We have implemented an intelligent and standardized management and control system of fire protection and water pressure through the adoption of IoT technology and our real-time data operation centers across the country, thus reducing the risk of administrative penalty and protecting personal and property safety of owners.

• Intelligent parking and remote guards: Benefitting from our extensive layout, we have launched an online remote carpark management system nationwide and achieved a cost effective management of carparks.

We plan to further expand the coverage of the abovementioned systems to other properties under our management to further enhance our operational efficiency.

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Further Optimize Our Human Resource System to Support Our Long-term Growth

We intend to further improve and continue to adhere to our human resource system that emphasizes the “selection 「選」”, “nurturing 「育」”, “retention 「留」” and “employment 「用」” of talents. With the implementation of a mutually created and sharing mechanism, we intend to fully implement an authorized responsibility system with business target to govern our operating entities at all levels. By reshaping our promotion management, performance management and salary management system, we plan to cultivate a new and dynamic performance culture to formulate a reasonable and effective sharing mechanism as well as provide effective incentives for employees. Moreover, we plan to adopt a result-oriented approach and formulate relevant and effective human resources policies in order to attract and acquire potential employees, retain existing employees and enhance their work standards as a whole.

We will formulate a more attractive and flexible remuneration policy. Project managers are encouraged to agilely work with the talents of their team to increase the operational revenue of projects in order to increase the salary level of the project employees.

We plan to broaden career development channels for employees and guide employees to develop their career through vertical height and horizontal width, enabling employees to discover their own direction in career development. We focus on nurturing our talents to attain senior management status in the aspects of marketing and sales (both property management services and value-added services) and community services.

We pay great attention to building up the echelon of talents for community service and operation, while establishing an internal talent pool for key positions and corresponding training and evaluation mechanisms. We plan to select a number of successors of project managers from junior level employees, and successors of senior operation managers (principals of branch offices or joint ventures, city marketing directors) from project managers. We will establish specialized training systems to train and cultivate prospective successors on an ongoing basis.

OUR BUSINESS MODEL

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• Value-added services to property developers. Our value-added services to property developers primarily consist of sales office management services.

The table below sets forth a breakdown of our total revenue by business line for the years or periods indicated:

For the year ended December 31, For the three months ended March 31, 2018 2019 2020 2020 2021 RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 % (Unaudited)

Total 2,404,287 100.0 2,810,349 100.0 3,035,600 100.0 693,162 100.0 783,798 100.0

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PROPERTY MANAGEMENT SERVICES

Overview

As of December 31, 2018, 2019 and 2020 and March 31, 2021, our total GFA under management was approximately 84.4 million sq.m., 101.4 million sq.m., 109.4 million sq.m. and 114.6 million sq.m., respectively. Our GFA under management by our joint ventures was approximately 11.7 million sq.m., 13.0 million sq.m., 55.5 million sq.m. and 59.3 million sq.m. as of the same dates, respectively. In 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, our revenue generated from property management services amounted to RMB1,905.8 million, RMB2,196.2 million, RMB2,315.4 million, RMB538.5 million and RMB608.1 million, respectively, accounting for 79.3%, 78.1%, 76.3%, 77.7% and 77.6%, respectively, of our total revenue for the same periods.

The table below sets forth the number of projects and GFA under our management, as well as the number of projects we were contracted to manage and corresponding contracted GFA as of the dates indicated:

As of As of December 31, March 31, 2018 2019 2020 2021

Number of projects under management (1) 532 627 681 708

Number of projects we were contracted to manage(2) 623 746 864 855

GFA under management (sq.m. in thousands) 84,442 101,369 109,429 114,606

Contracted GFA (sq.m. in thousands) 98,334 133,398 153,124 152,833

Notes:

(1) Refer to properties that have been delivered or are ready to be delivered by property developers to property owners, to us for property management purposes for which we are already collecting property management fees in relation to contractual obligations to provide our services.

(2) Refer to properties managed or to be managed by our Group for which we have entered into the relevant property management service agreements, including properties that have not been delivered to us for property management purposes in addition to properties under our management.

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Our Geographical Presence

Since our inception in 1993 in Shenzhen, Guangdong province, we have expanded our geographic presence for property management services to a wide range of cities across the PRC. As of March 31, 2021, we were contracted to manage 855 projects with a total contracted GFA of 152.8 million sq.m., spanning 162 cities in 31 provinces, municipalities and autonomous regions, with 62.4% of our GFA under management located in tier-one and new tier-one cities in China. The map below illustrates the cities in which we had projects under management and contracted but undelivered projects as of March 31, 2021:

North China Region

Cities in which we have projects under management

Beijing Hebei Province: Shijiazhuang, Langfang, Cangzhou, Xiong’an, Zhangjiakou, Tangshan Ningxia: Yinchuan, Shizuishan, Wuzhong, Zhongwei, Guyuan Cities in which we have contracted but undelivered projects

Baoding, Xingtai, Handan

Bohai Region

Cities in which we have projects under management Bohai Region Tianjin North China Liaoning Province: Shenyang, Dandong, Region Panjin, Dalian Jilin Province: Changchun, Jilin Heilongjiang Province: Harbin

Cities in which we have contracted but undelivered projects Siping, Mudanjiang, Suifenhe Central China East China Region Region

East China Region West China Region Cities in which we have projects under management

Shanghai Zhejiang Province: Hangzhou, Ningbo, Taizhou, Wenzhou, Jiaxing Jiangsu Province: Nanjing, Suzhou, Taizhou, Nantong, Yangzhou, Wuxi, Yizheng, Xuzhou Anhui Province: Hefei, Wuhu, Tongling, Huangshan, Fuyang Shandong Province: Jinan, Jining, Yantai, Weihai, Rizhao, West China Region South China Weifang, Binzhou Region Cities in which we have contracted but undelivered projects Cities in which we have projects under management Suzhou Chongqing Sichuan Province: Chengdu, Luzhou, Mianyang, Nanchong, Ganzi Gansu Province: Lanzhou, Baiyin, Tianshui, Guang’an, Zhangye Yunnan Province: Kunming Central China Region Qinghai Province: Xining, Haidong Tibet: Lhasa Cities in which we have projects under management Xinjiang: Urumqi South China Region Inner Mongolia: Huhhot, Erdos, Ulanqab Hubei Province: Wuhan, Jingzhou,Yichang, Shiyan, Xiangyang Cities in which we have contracted but Cities in which we have projects under management Shaanxi Province: Xi’An, Weinan, Xiangyang, Yulin undelivered projects Jiangxi Province: Nanchang, Shangrao, Jingdezhen, Fengcheng, Guangdong Province: Guangzhou, Shenzhen, Zhongshan, Shaoguan, Xinyu, Ganjiang, Ganzhou Guangyuan, Bazhong, Meishan, Yibin, Horgos, Maoming, Humen, Zhaoqing, Foshan, Huizhou, Tacheng, Beitun, Changji, Xilingol, Tongliao, Henan Province: Zhengzhou, Sanmenxia, Xinyang Dongguan Shanxi Province: Taiyuan, Datong, Yuncheng Jiuquan Guangxi Zhuang Autonomous Region Province: Guigang, Nanning Hainan Province: Haikou Hunan Province: Changsha, Zhuzhou, Jishou, Changde, Xiangtan Cities in which we have contracted but undelivered projects Guizhou Province: Guiyang, Qiannan, Liupanshui, Bijie Baoji, Hanzhong, Jiujiang, Pingdingshan, Zhoukou, Jincheng, Fujian Province: Fuzhou, Quanzhou, Xiamen, Zhangzhou, Jingmen Sanming, Ningde Cities in which we have contracted but undelivered projects Zhanjiang, Yunfu, Yangjiang, Shanwei, Shantou, Qingyuan, Meizhou, Jieyang, Heyuan, Chaozhou, Zhuhai, Sanya, Yueyang, Qiandongnan, Hezhou, Chenzhou, Beihai, Jiangmen, Yingtan

– 142 – The table below sets forth a breakdown of our total GFA under management as of the dates indicated, and total revenue generated THE THAT AND CHANGE THE TO ON “WARNING” SUBJECT HEADED SECTION AND THE INCOMPLETE WITH DOCUMENT. CONJUNCTION FORM, THIS IN OF DRAFT COVER READ BE IN MUST IS INFORMATION DOCUMENT THIS from property management services as well as their respective percentage of our total revenue generated from property management services for the periods indicated, by geographic region:

South China Region

10,375 249,110 13.1 14,295 303,782 13.8 17,262 311,250 13.4 16,842BUSINESS 76,275 14.2 17,564 82,867 13.6 Bohai Region (6) 9,366 247,566 13.0 9,264 242,296 11.0 10,349 249,969 10.8 8,796 57,199 10.6 11,235 65,168 10.7 4 – 143 –

Total 84,442 1,905,789 100.0 101,369 2,196,176 100.0 109,429 2,315,359 100.0 103,529 538,546 100.0 114,606 608,096 100.0

Notes:

(1) Includes Guangdong Province, Guangxi Zhuang Autonomous Region, Fujian Province, Hunan Province, Hainan Province and Guizhou Province.

(2) Includes Beijing, Hebei Province and Ningxia Hui Autonomous Region.

(3) Includes Shanghai, Shandong Province, Anhui Province, Jiangsu Province and Zhejiang Province.

(4) Includes Hubei Province, Jiangxi Pronvince, Henan Province, Shanxi Province and Shaanxi Province.

(5) Includes Chongqing, Sichuan Province, Yunnan Province, Qinghai Province, Gansu Province, Inner Mongolia Autonomous Region, Xinjiang Uygur Autonomous Region and Tibet Autonomous Region.

(6) Includes Tianjin, Liaoning Province, Jilin Province and Heilongjiang Province. THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. BUSINESS

As of March 31, 2021, our total contracted GFA of undelivered projects was approximately 38.2 million sq.m. and number of projects we were contracted to manage but not yet delivered to us was 147, for which we have not begun collecting property management fees.

Scope of Services

We provide the following major categories of property management services:

• Cleaning services. We provide cleaning services for property units and common areas which may include mail boxes, staircases, hallways, exterior walls and basements. We provide our cleaning services primarily through our employees and third-party subcontractors.

• Security services. We seek to ensure that the properties we manage are safe and in good order. The security services we provide are round the clock and include, among others, traffic management, patrolling, video surveillance, car park security, emergency response, entry control and visitor management. We provide our security services primarily through third-party subcontractors.

• Greening and landscaping services. We provide greening and landscaping services which mainly include pruning, plant watering and fertilization for the greenery of our managed properties through our employees and third-party subcontractors.

• Repair and maintenance services. We are generally responsible for ensuring roofs, hallways, elevator systems, power supply and distribution systems, water supply and drainage systems, central air conditioning systems, fire extinguishing systems, lighting system, and other facilities and equipment located in common areas are in good working order. We provide regular repair and maintenance services through our employees.

While providing our property management services, we conduct an on-site quality check each month, monitor the services through self-check, sample testing, documents review, video surveillance and follow-up calls, as well as record and respond to complaints and feedback on our services. See “—Quality Control—Quality Control of Our Property Management Services” below for more information. As of March 31, 2021, we employed approximately 12,500 staff and 20,000 outsourced personnel to provide property management services and engaged over 280 selected subcontractors to provide certain property management services, mainly including cleaning services, security services and greening and landscaping services.

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We manage a diversified portfolio, comprising residential properties and different types of non-residential properties, mainly commercial properties and public properties. The non-residential properties under our management include, but are not limited to, commercial complexes, office buildings, transportation hubs, schools, hospitals, and other public facilities, such as exhibition centers and city parks.

The table below sets forth a breakdown of our total GFA under management and number of projects under management as of the dates indicated, and revenue from property management services for the years or periods indicated, by type of property:

management management Revenue management management Revenue management management Revenue managementBUSINESS management Revenue management management Revenue sq.m.’000 Number RMB’000 % sq.m.’000 Number RMB’000 % sq.m.’000 Number RMB’000 % sq.m.’000 Number RMB’000 % sq.m.’000 Number RMB’000 % (Unaudited) 4 – 145 –

Residential properties 64,648 346 1,243,412 65.3 77,813 429 1,456,606 66.3 83,631 463 1,502,706 64.9 80,207 441 364,398 67.7 84,937 471 395,532 65.0

Non-residential properties 19,794 186 662,377 34.7 23,556 198 739,570 33.7 25,798 218 812,653 35.1 23,322 195 174,148 32.3 29,669 237 212,564 35.0

Commercial properties 15,872 153 587,251 30.8 14,989 146 634,482 28.9 19,324 175 686,572 29.7 16,497 148 141,681 26.3 20,400 191 176,741 29.1

Public properties 3,922 33 75,126 3.9 8,567 52 105,088 4.8 6,473 43 126,081 5.4 6,825 47 32,467 6.0 9,269 46 35,823 5.9

Total 84,442 532 1,905,789 100.0 101,369 627 2,196,176 100.0 109,429 681 2,315,359 100.0 103,529 636 538,546 100.0 114,606 708 608,096 100.0 THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. BUSINESS

Growth of Our Project Portfolio

As of December 31, 2018, 2019 and 2020 and March 31, 2021, we had 532, 627, 681 and 708 projects under management, respectively. As of December 31, 2018, 2019 and 2020 and March 31, 2021, our total GFA under management was approximately 84.4 million sq.m., 101.4 million sq.m., 109.4 million sq.m. and 114.6 million sq.m., respectively. We have been growing our project portfolio during the Track Record Period primarily by obtaining new property management service agreements. Going forward, we intend to continue to increase our business scale and market share through organic growth, community outreach, strategic investment and acquisition, upgrading information technology platform, optimizing human resources as well as exploring new segments in non-residential properties. See “—Business Strategies—Reinforce Our Leading Position in Property Management Industry through Expanding Business Scale” above for more information.

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As of or for the year ended December 31, As of or for the three months ended March 31, 2018 2019 2020 2020 2021

Contracted projects

Projects under Projects under Projects under Projects under Projects under (1) management(1) Contractedmanagement projects (1) Contractedmanagement projects (1) Contractedmanagement projects (1) Contractedmanagement projects Number of Number of Number of Number of Number of Number of Number of Number of Number of Number of projects GFA projects GFA projects GFA projects GFA projects GFA projects GFA projects GFA projects GFA projects GFA projects GFA (sq.m.’000, except for number of projects)

As of the beginning of the period 544 85,180 465 77,351 623 98,334 532 84,442 746 133,398 627 101,369 746 133,398 627 101,369 864 153,124 681 109,429 New engagements

(2) 112 19,295 100 13,232 155 37,271 126 19,134 178 27,730 114 16,064 20 1,749 33 6,216 15 4,072 51 9,540 Acquisitions (3) ––––13542354––––––––––––BUSINESS Terminations (4) 33 6,141 33 6,141 33 2,561 33 2,561 60 8,004 60 8,004 24 4,056 24 4,056 24 4,363 24 4,363 4 – 147 –

As of the end of the period 623 98,334 532 84,442 746 133,398 627 101,369 864 153,124 681 109,429 742 131,091 636 103,529 855 152,833 708 114,606

Notes:

(1) Include projects under management and projects contracted but not yet delivered.

(2) Primarily include (i) preliminary property management service agreements for new projects developed by property developers and (ii) property management service agreements for residential or non-residential communities to replace their previous property management service providers. The renewed agreements are not regarded as the new engagements that we entered into during such year. The newly engaged GFA under management includes the newly delivered GFA we contracted in previous year.

(3) Refer to new GFA we obtained through our acquisitions of certain property management company during the Track Record Period.

(4) Primarily include our non-renewal of certain property management service agreements as we reallocated our resources to more profitable engagements to optimize our project portfolio or we voluntarily withdrew from retention tender process due to intense competition. Property Management Fees THE THAT AND CHANGE THE TO ON “WARNING” SUBJECT HEADED SECTION AND THE INCOMPLETE WITH DOCUMENT. CONJUNCTION FORM, THIS IN OF DRAFT COVER READ BE IN MUST IS INFORMATION DOCUMENT THIS

During the Track Record Period, a substantial portion of our property management fees were charged on a lump sum basis, with the remainder charged on a commission basis. In 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, 98.8%, 98.8%, 98.9%, 99.0% and 99.1% of our revenue generated from property management services was charged on a lump sum basis, respectively, while 1.2%, 1.2%, 1.1%, 1.0% and 0.9% of our revenue generated from property management services was charged on a commission basis for those same years, respectively. See “Risk Factors—Risks Relating to Our Business and Industry—We may fail to effectively anticipate or control our costs in providing our property management services, for which we generally charge our customers on a lump sum basis” for discussion of the related risks.

The following table sets forth a breakdown of our total GFA under management by fee model as of the dates indicated and revenue generated from property management services by fee model for the periods indicated: BUSINESS

As of or for the year ended December 31, As of or for the three months ended March 31, 4 – 148 – 2018 2019 2020 2020 2021 GFA Revenue GFA Revenue GFA Revenue GFA Revenue GFA Revenue sq.m. RMB % sq.m. RMB % sq.m. RMB % sq.m. RMB % sq.m. RMB % (in thousands, except for percentages) (Unaudited)

We take into account a number of factors in determining whether to charge fees on a lump sum or commission basis, including, but not limited to, local regulations, personalized requirements specified by property developers or property owners’ associations, affordability of property management fee and quality expectation of the property owners, local market conditions, projected profitability and the nature and characteristics of individual properties, and determine the fee model on a case-by-case basis. The following diagram illustrates the two fee models under which we manage residential properties:

Preliminary property management service agreements (early stage property service contracts) Our Group Property developers Provide property management services before property delivery

Pay property management fee Provide property management services Property after property delivery Sell property management Property management fee. Lump sum basis: service agreement all property management fees are recognized as our revenue and expenses are borne by our Group Commission basis: a pre-determined percentage of property management fees is recognized as our revenue and the remainder is used as working capital to cover the expenses for managing such properties, which are borne by the customers Property owners’ Property owners associations Establish property owners’ association

Contractual relationship

Property Management Fees Charged on a Lump Sum Basis

Under the lump-sum fee model, we charge a fixed and “all-inclusive” fee for our property management services which we provide through our employees and subcontractors, and our property management fees are typically charged on a monthly, quarterly, or annual basis, depending on the terms of our property management service agreements. For residential properties, we typically charge property management fees annually. For commercial properties and public properties, property management fees are typically charged on a monthly basis. We are entitled to retain the full amount of property management fees collected from property developers, property owners and residents as revenue and bear the costs incurred in providing our property management services. According to CIA, the lump-sum fee model is the prevailing method of collecting property management fees in China, especially in relation to residential properties. See “Industry Overview—The Property Management Industry in the PRC—Major Revenue Models in the PRC Property Management Industry” in this document for further information.

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Prior to negotiating and entering into our property management service agreements, we seek to prepare, as accurate as possible, an estimate of our cost of sales. Our cost of sales primarily includes labor costs, repair and maintenance costs, security services costs, cleaning services costs, utilities costs, greening and landscaping costs. As we bear such expenses ourselves, our profit margins are affected by our ability to lower our cost of sales. In the event that our cost of sales is higher than anticipated, we may not be able to collect additional amounts from our customers to sustain our profit margins, however, we may have option to raise the property management fee through friendly negotiation while still maintaining our high quality service standard, explore other value-added service for profit growth and increase the financial and operational efficiency by applying automated system. See “Risk Factors—Risks Relating to Our Business and Industry—We may fail to effectively anticipate or control our costs in providing our property management services, for which we generally charge our customers on a lump sum basis” in this document for further discussion.

In 2018, 2019 and 2020 and the three months ended March 31, 2021, we incurred losses of RMB25.7 million, RMB14.9 million, RMB11.8 million and RMB2.6 million, respectively, with respect to 36, 32, 31 and 19 properties under our management, respectively. In 2018, 2019 and 2020 and the three months ended March 31, 2021, we generated RMB94.0 million, RMB79.0 million, RMB66.3 million and RMB16.1 million from these loss-making property management projects, respectively, representing 3.9%, 2.8%, 2.2% and 2.1% of our total revenue for the same periods, respectively. Such losses were primarily because the amount of property management fees we received was insufficient to cover the service costs incurred to offer quality property management services.

During the Track Record Period, we continued to manage certain of those loss-making projects with a view to gradually improving their profitability. We plan to turn around our operations in relation to these properties by (i) actively communicating with the relevant property developers or property owners’ associations to renegotiate our fee rates upon renewal of the relevant property management service agreements; (ii) further streamlining our business operations and improve the efficiency of our employees leveraging economies of scale as well as our smart integrated operation platform; and (iii) promoting community value-added services in those properties, which typically generates higher profit margins than property management services.

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Property Management Fees Charged on a Commission Basis

During the Track Record Period, we derived revenue from a limited number of property management service agreements on a commission basis. Our revenue generated from properties managed on a commission basis represented approximately 1.2%, 1.2%, 1.1% and 0.9%, respectively, of our total revenue from property management services in 2018, 2019, 2020 and the three months ended March 31, 2021. On a commission basis, we recognize as revenue a predetermined property management commission fee generally representing 8.0% to 10.0% of the property management fees payable by property owners, residents and property developers, while the remainder of such management fees are used as working capital to cover the property management expenses we incur.

When we contract to manage residential properties on a commission basis, we typically act as an agent of the property owners and residents. As the management offices of these residential properties have no separate bank accounts, all transactions related to such management offices are settled through our treasury function. As of the end of a reporting period, if the working capital of a management office accumulated in our treasury function is insufficient to cover the expense that has been incurred as of the reporting period, the shortfall will be shared among property owners and residents. During the Track Record Period, nine of the non-residential properties and 58 of the residential properties we had been contracted to manage were charged on a commission basis.

Under the commission fee model, we are not entitled to any excess of the property management fees paid by customers over the costs and expenses associated with the provision of services to the property. Therefore, we do not recognize any direct cost under property management service agreements charged on a commission basis in general. Such costs are borne by the customers.

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Average Property Management Fee

In 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, our overall average property management fee was approximately RMB1.9 per sq.m. per month, RMB1.8 per sq.m. per month, RMB1.8 per sq.m. per month, RMB1.7 per sq.m. per month and RMB1.8 per sq.m. per month, respectively. The property management fees we charged during the Track Record Period were determined in accordance with local regulations and normal commercial terms. For an analysis on our average property management fee and its impact on our gross profit margin during the Track Record Period, please refer to “Financial Information—Description of Certain Consolidated Statements of Comprehensive Income—Gross Profit and Gross Profit Margin—Property Management Services.”

Tender Process

The majority of our property management service agreements are obtained by participating in tenders, a process whereby property developers or property owners’ associations evaluate and select from multiple property management service providers. Invitations to tenders are usually issued by property developers for properties under development, or from property owners’ associations for residential properties that wish to replace their existing property management service providers. Under PRC laws and regulations, property management companies are required to obtain preliminary property management service agreements for residential properties through participation in the tender process. If there are fewer than three bidders for any small-scale properties, the property developer can select and hire qualified property management company by directly entering into an agreement with the approval of the real estate administrative department of the relevant district or county government where the property is located. See “Regulatory Overview—Laws and Regulations Relating to Property Management Services and Other Related Services—Appointment of Property Service Enterprises.” in this document for more information on the relevant legal requirements on tender processes. A tender process is also required for engaging property management service providers for services over a designated amount in relation to non-residential properties owned by the PRC government agencies, institutions or organizations according to the Government Procurement Law of the PRC《政府採購法》 ( ) and relevant laws and regulations.

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The flow chart below illustrates each stage of the typical tender process for obtaining property management service agreements:

Receiving invitation or notice regarding the tender process or bidding opportunity

Establishing a project management team responsible for the bid

Participating and submitting documents required for pre-qualification

Researching relevant details of the property/properties involved and preparing budget estimates

Participating and submitting tender bids outlining, among others, our plans, costs and qualifications

Tender evaluation

Award of contract or rejection

Signing the property management service agreement and filing such agreement with relevant local authority, or analyzing reasons behind the rejection

We participated in 215, 454, 447 and 40 bidding processes in 2018, 2019, 2020 and the three months ended March 31, 2021, respectively. Our bidding success rate for the same periods was 35.5%, 35.9%, 37.8% and 42.5%, respectively. We obtained valuable market information and experience relating to the competition for projects across key regions for our development by actively participating in many tender and bidding processes. We intend to continue to enhance our business development capabilities by taking steps to improve team work and collaboration among our marketing personnel, and by refining the allocation of tasks at all stages of the tender and bidding process. To help drive these improvements, we will continue to refine our pre-bidding market research and project assessment and post-bidding analysis of our performance.

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As of the Latest Practicable Date, for two projects under our management, the relevant property developers did not organize the required tender and bidding process and directly engaged us to provide property management services (the “Relevant Property Management Projects”). Such properties had an aggregate GFA under management of approximately 90,000 sq.m. as of the Latest Practicable Date. Our revenue from property management services for such properties amounted to approximately RMB1.2 million, RMB2.2 million, RMB3.4 million and RMB0.8 million, respectively, in 2018, 2019 and 2020 and the three months ended March 31, 2021, representing 0.1%, 0.1%, 0.1%, and 0.1%, of our total revenue from property management services for the same periods, respectively. Invitations to tender are usually issued by property developers. Under PRC laws and regulations, property developers are required to select property management companies for preliminary property management service contracts for residential properties through the tender process. According to the Regulations on Property Management, a residential property developer may be required to take rectification measures within a prescribed period and pay fines up to RMB100,000 if it fails to comply with such tender and bidding requirement. Please refer to “Regulatory Overview—Laws and Regulations Relating to Property Management Services and Other Related Services—Appointment of Property Service Enterprises” in this document. If there are fewer than three bidders or for any small scale properties, the property developer can select and hire a qualified property management company by directly entering into an agreement with the approval of the real estate administrative department of the relevant district or county government where the property is located.

As confirmed by our Directors, the lack of a tender and bidding process for the selection of property management services providers for the Relevant Property Management Projects was caused by property developers but not us and we obtained the service contracts for the Relevant Property Management Projects through regular business negotiations at arm’s length. As advised by our PRC Legal Advisor, according to the relevant PRC laws and regulations, the property management service provider is not the responsible party to organize the tender and bidding process, and current PRC laws and regulations are silent on whether a property management service provider shall be subject to any administrative penalty if it was contracted without going through a required tender and bidding process. Accordingly, our PRC Legal Advisor is of the opinion that the risk of, as property management service provider, being subject to administrative penalty due to the absence of a tender and bidding process for these residential property projects was remote. Our Directors also confirm that, based on the opinion given by our PRC Legal Advisor and the percentage of the revenue from the management services for the Relevant Property Management Projects to our total revenue during the Track Record Period, the lack of a tender and bidding process for the Relevant Property Management Projects will unlikely have any material and adverse impact on our business, financial position or results of operations. As of the Latest Practicable Date, we were not aware of any administrative penalties or any notice of any potential administrative penalties from the relevant competent authorities on the relevant property developers in relation to such property management service contracts. See “Risk Factors—Risks relating to Our Business and Industry—Some of our property management agreements were obtained without going through the required tender and bidding process” in this document.

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In order to ensure our ongoing compliance with the relevant regulations on the tender and bidding process, we have implemented a series of internal control measures, including (i) tender and bidding confirmation procedures, which require our staff to approve property management service contracts only if they are accompanied by the tender and bidding materials; (ii) ongoing monitoring measures, which include filing the internal approval record of the complete tender and bidding process to ensure compliance with relevant laws and regulations; and (iii) reviewing measures, which include checking the approval records of property management service contracts.

Property Management Service Agreements

We generally enter into preliminary property management service agreements with property developers at the construction and pre-delivery stage of property development projects.

In relation to residential properties that have already been delivered but the property owners’ associations have not been established, we provide property management services to property owners and residents pursuant to the preliminary property management service agreements that we entered into with the property developer.

In relation to residential properties that have already been delivered and property owners’ associations that have been established, we enter into property management service agreements with property owners’ associations on behalf of property owners. As of March 31, 2021, 140 residential properties under our management established property owners’ associations, which accounted for approximately 29.7% of the total number of residential properties under our management. Such property owners’ associations had not requested to replace us with other property management companies as of the Latest Practicable Date. The property owners’ associations are independent from us.

We procured a majority of our non-residential projects by entering into property management service agreements or establishing joint ventures with state-owned enterprises in the PRC.

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As of or for the year ended December 31, As of or for the three months ended March 31, 2018 2019 2020 2020 2021 GFA under GFA under GFA under GFA under GFA under management Revenue management Revenue management Revenue management Revenue management Revenue sq.m.’000 RMB’000 % sq.m.’000 RMB’000 % sq.m.’000 RMB’000 % sq.m.’000 RMB’000 % sq.m.’000 RMB’000 % (Unaudited)

Preliminary stages

(1) 48,269 820,401 43.0 60,887 1,073,303 48.8 62,157 1,093,264 47.2 60,926 262,281 48.7 62,133 270,385 44.4 Property owners’ associations stage (2) 16,379 423,011 22.2 16,926 383,303 17.5 21,474 409,442 17.7 19,281 102,117 19.0 22,804 125,147 20.6 Non-residential (3) 19,794 662,377 34.8 23,556 739,570 33.7 25,798 812,653 35.1 23,322 174,148 32.3 29,669 212,564 35.0

Total 84,442 1,905,789 100.0 101,369 2,196,176 100.0 109,429 2,315,359 100.0 103,529 538,546 100.0 114,606 608,096 100.0 BUSINESS 5 – 156 –

Notes:

(1) Include residential properties that have been delivered but the property owners’ association have not been established.

(2) Include residential properties for which we rendered services after property owners’ associations were established.

(3) Include commercial and public properties. THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. BUSINESS

Key Terms of Dealing with Property Developers

Our preliminary property management service agreements with property developers typically include the following key terms:

• Scope of services. A typical preliminary property management service agreement with property developer sets out the required services, including cleaning services, security services, greening and landscaping services and repair and maintenance services. We may also provide other customized services, such as car parks management services.

• Performance agreement standards. The preliminary property management service agreements set forth the scope and expected standards, such as the areas to which our services are related, as well as the requirements, frequency and standards for the performance of our services.

• Property management fees. The preliminary property management service agreements set forth the amount of property management fees payable, generally on a lump sum basis. The property developer is typically responsible for paying the property management fees for the units that remain unsold. If we agree to manage car parks, the preliminary property management service contract will also specify the fees payable for such services. For overdue property management fees, property developers should pay an overdue penalty as specified in the agreement.

• Property developer’s obligations. The property developer is primarily responsible for, among others, ensuring that its property buyers understand their obligations in relation to property management services provided by us and incorporating the relevant terms of the preliminary property management service agreement into the property purchase agreement, and providing us with office facilities and other support necessary for carrying out our contractual obligations.

• Our rights and obligations. We are entitled to receive property management fees according to the relevant provisions in the agreement. We are responsible for (i) providing the services included in the agreement; (ii) cooperating with the supervision by property developers; (iii) monitoring property use; (iv) publicly disclosing the scope of service, pricing standards and collection methods of any specially commissioned services; and (v) offering relevant records and materials as necessary.

• Term of service and termination. Our preliminary property management service agreements are generally without fixed terms and will terminate when a property owners’ association is established and a new property management service agreement is entered into.

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• Dispute resolution. Parties to the property management service agreement are typically required to resolve any contractual disputes through negotiations first before resorting to court proceedings.

For residential properties, after delivery of the projects by property developers to the property owners, property owners may form and operate property owners’ associations to manage the projects. The Civil Code of the PRC, the Regulations on Property Management and the Guidance Rules of the Owners’ Meeting and the Property Owners’ Association stipulate that property owners’ associations may be established at property owners’ meeting by a vote of at least half of the property owners who own over half of the delivered GFA in the residential community. According to the Interpretations of the Supreme People’s Court on Issues Relating to Application of Laws for Trial of Property Management Service Dispute Cases《最高人民法院關於審理物業服務糾紛案件具體應用法 ( 律若干問題的解釋》) (the “Interpretations”), a preliminary property management service agreement entered into between a property developer and a property management service company in accordance with the PRC laws and regulations is legally binding on the relevant property owners. According to the Interpretations, where any property owner argues that the preliminary property management service agreement is not applicable on the ground that he/she is not a party to the same, the relevant People’s Court shall not uphold such claim. According to the Regulations on Property Management (2018 revision) (《物業管理條例》) (2018年修正), a sales contract concluded by a property developer and a property buyer shall include the contents stipulated in the relevant preliminary property management service agreement. Therefore, as advised by our PRC Legal Advisor, the preliminary property management service agreements entered into with property developers in compliance with the aforementioned regulations are legally binding on the relevant future property owners as the property sale and purchase agreements that property owners enter into with property developers shall include the content of the preliminary property management service contracts.

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Once our preliminary property management service agreements have expired, we may negotiate with the newly-formed property owners’ associations for the terms of new property management service agreements. The property owners’ associations are independent from us. In order to secure and continue to secure property management service agreements, we must consistently provide quality services at competitive prices. According to the Regulations on Property Management, property owners’ associations may hire or dismiss property management service providers at the property owner meeting with affirmative votes by owners whose ownership of exclusive areas accounts for more than half of the total GFA of the exclusive area of the community and whose number accounts for more than half of the total number of all property owners, provided that such decision will not constitute a violation of applicable law or a breach of the respective contract. The property owners’ meeting may either hire a new property management service provider through the tender process or select one based on specific standards to do with terms and conditions of service, quality and price. See “Regulatory Overview—Laws and Regulations Relating to Property Management Services and Other Related Services—Appointment of Property Service Enterprises” in this document for more information.

Property owners and residents were legally obligated to pay us property management fees, since we continued rendering services to those property management projects during the negotiation period. If, upon the expiration of the initial term of the preliminary property management service agreements, the property owners’ association has not been formed or a new property management service agreement has not been entered into between the property owners’ association and us, the preliminary property management service agreements typically will be renewed automatically until a new property management service agreement with the property owners’ association is entered into. In cases where we have signed preliminary property management service agreements without fixed terms and no property owners’ association is formed after delivery of the projects, or after the expiration of the preliminary property management service agreements with fixed terms, where property owners did not hire new service provider and we continued to provide property management services, property owners and residents are also legally obligated to pay property management fees directly to us for the services we continue to render.

Key Terms of Dealing with Property Owners’ Associations

Our property management service agreements with property owners’ associations typically include the following key terms:

• Scope of services. We typically agree to provide property management services including cleaning services, security services, greening and landscaping services and repair and maintenance services.

• Performance standards. The property management service agreement would set forth the expected standards for our property management services, including areas to which our services relate, as well as the frequency of performance of services.

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• Property management fees. The property management fee would be payable either on a lump sum or commission basis by property owners and residents according to the relevant service agreement. When payable on a lump sum basis, our property management fees are generally charged by GFA. For overdue property management fees, property owners and residents shall pay an overdue penalty as specified in the service agreement.

• Rights and obligations of property owners’ association. The property owners’ association is primarily responsible for, among others, (i) ensuring timely payment of property management fees and providing us with support necessary for carrying out our contractual obligations; (ii) supervising and advising property management services provided by us; (iii) reviewing and approving our annual property management plan, maintenance plan and budget; (iv) commissioning satisfactory survey among property owners and residents with regard to our services; and (v) managing and contributing to the special maintenance fund in accordance with the agreement.

• Our rights and obligations. We are entitled to timely collection of property management fees as provided in the agreement. We are in turn responsible for offering services provided in the agreement pursuant to the relevant service standards. We are also responsible for recordkeeping, managing use of properties by occupants, and announcing major information such as collection and spending of fees.

• Terms of service and termination. Our property management service agreements generally have a fixed term of one to three years. If the property management service agreement expires before the property owners’ association enters a new property management service agreement with a new property management service provider and we intend to continue to provide property management services under the agreement the existing property management service agreement shall be extended with no fixed term. For property management service agreements with no fixed term, either party would be entitled to terminate the agreement with written notice no less than 60 days before the proposed termination date.

Under PRC law, property owners’ associations represent the interests of property owners in matters concerning property management. Decisions that are within the authorized scope of the property owners’ association are binding on all property owners. Agreements between property owners’ associations and property management service providers are valid and legally binding on all property owners concerned, irrespective of whether or not the property owners are individual parties to such contracts. Thus, we have legal claim rights against property owners for outstanding property management fees. Property owners and residents have the right to be informed of and to supervise the use of public funds, review our annual budget and any plans we prepare in relation to topping-up the public funds or our property management services in general. Property owners are jointly liable with the residents of their properties for the payment of property management fees.

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Key Terms of Non-residential Properties

We enter into property management service agreements with property owners and property developers for the management of non-residential properties. According to the Regulations on Property Management (2018 revision)《物業管理條例》 ( ) (2018年修正), where there is only one owner, or where there are a few owners and they all agree not to form the property owners’ general meeting, the owner(s) shall (jointly) perform the duties of the property owners’ general meeting and the property owners’ association. Thus, for non-residential properties which have no property owners’ associations, we directly negotiate and enter into contract with, and perform our property management services to, property owners after the delivery of non-residential projects by property developers to such property owners. Our property management service agreements for non-residential properties typically include the same key terms as those for residential properties, such as scope of services, performance standards, property management fees, the parties’ respective rights and obligations and terms of service. Property management service agreements for non-residential properties generally have fixed terms of one to three years.

Our Pricing Policy

We generally price our services by taking into account factors, such as the type and locations of the properties, our budget, target profit margins, property owners’ and residents’ profiles, the scope and quality of our services and local government’s guidance price on property management fees (where applicable). We regularly evaluate our financial information to assess whether we are collecting sufficient property management fees to sustain our profit margins. During renewal negotiations for our property management service agreements, we may raise our property management fee rates as a condition precedent for continuing our services.

The price administration and construction administration departments of the State Council are jointly responsible for supervision over and administration of fees charged for property management and related services, and for property management fees for affordable housing, we are also subject to pricing controls issued by the PRC Government. In December 2014, the NDRC issued the Circular of the NDRC on the Opinions of Liberalizing Price Controls in Certain Services《國家發展和改革委員會關於放開部分服務 ( 價格意見的通知》) (the “Price Control Liberalization Circular”), which required provincial-level price administration authorities to liberalize the price control or guidance policies on affordable housing, with certain exceptions. See “Regulatory Overview—Laws and Regulations Relating to Property Management Services and Other Related Services—Fees Charged by Property Management Companies” in this document. We expect that pricing controls on residential properties will relax over time as relevant local authorities pass regulations to implement the Price Control Liberalization Circular. See “Risk Factors—Risk Relating to Our Business and Industry—We may fail to effectively anticipate or control our costs in providing our property management services, for which we generally charge our customers on a lump sum basis” in this document.

As advised by our PRC Legal Advisor, unlike affordable housing, property management services for non-affordable housing are not subject to the pricing regulations imposed by the PRC government.

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The following table sets forth the average property management fee per sq.m. of the properties under our management by type of property for the years of periods indicated:

Three months ended Year ended December 31, March 31, 2018 2019 2020 2021 (RMB per sq.m. per month)

Residential properties 1.6 1.6 1.5 1.6 Non-residential properties 2.8 2.6 2.6 2.4

Payment and Credit Terms

We may charge property management fees on an annual, quarterly or monthly basis, depending on the terms of our property management service agreements. For residential properties, we typically charge property management fees on an annual basis. For commercial properties and public properties, property management fees are typically charged on a monthly basis. The fees for property management services are typically due for payment by property owners and residents upon our issuance of a demand note. We typically demand payment for our property management services upon receipt of the demand note by property owners and residents which, according to CIA, is consistent with the property management industry norm in the PRC. We primarily accept payments for property management fees by through online transfers such as EINYUN Life, bank card or third-party payment platforms. To facilitate the timely collection of property management fees and other payments, we may send payment reminders to property developers, property owners and residents in writing on a monthly basis. In relation to the collection of outstanding property management fees, we remind our customers of the outstanding amount by sending monthly demand to such customers. If the outstanding fees remain unpaid 180 days after the original due date, we may issue a demand letter through attorneys via registered mail, and may file a lawsuit against such customer to claim the outstanding amounts. Concurrently, we will at least issue one demand letter every year to ensure that we fulfill requirements under PRC statutes of limitations, which impose a three year deadline by which we may sue for outstanding property management fees. For more information on our trade receivables and related risks thereof, see “Financial Information—Description of Selected Items of Consolidated Balance Sheets—Trade and Other Receivables” and “Risk Factors—Risks Relating to Our Business and Industry—We may not be able to collect property management fees from property owners, residents and/or property developers which could incur impairment losses on our trade receivables” in this document. To the extent permitted under PRC law, we collect utility fees from property owners and residents in relation to electricity and water supply in addition to agreed-upon property management fees.

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Expiration Schedule of Property Management Services Agreements

The table below sets forth the expiration schedule of our property management service agreements for projects under our management as of March 31, 2021:

GFA under Number of Contracted but Number of management agreements undelivered GFA agreements sq.m. ’000 % Number % sq.m. ’000 % Number %

Property management service agreements without fixed terms (1) 55,640 48.5 305 43.1 12,795 33.5 48 32.7 Property management service agreements with fixed terms expiring in: Year ending December 31, 2021 20,356 17.8 144 20.3 532 1.4 3 2.0 Year ending December 31, 2022 18,632 16.3 130 18.4 2,076 5.4 11 7.5 Year ending December 31, 2023 and beyond 19,978 17.4 129 18.2 22,824 59.7 85 57.8

Subtotal 58,966 51.5 403 56.9 25,432 66.5 99 67.3

Total 114,606 100.0 708 100.0 38,227 100.0 147 100.0

Note:

(1) Property management service agreements without fixed terms are typically (i) agreements entered into with property developers before a property owners’ association is set up, and (ii) agreements entered into with certain property developers, owners or residents with whom we had property management service agreements that had fixed terms, but such terms expired and will generally terminate once a property owners’ association has been set up and a new property management service agreement between such property owners’ association and a property management company becomes effective. We face certain risks if such property management agreements are terminated or not renewed. See “Risk Factors—Risks Relating to Our Business and Industry—We cannot assure you that we can secure new or renew our existing property management service agreements on favorable terms, or at all” for further discussion.

In 2018, 2019 and 2020 and the three months ended March 31, 2021, our renewal rate for property management service agreements was 95.2%, 92.5%, 93.3% and 88.2%, respectively, while the retention rate for preliminary property management service agreements was 95.1%, 94.8%, 91.2% and 97.6%, respectively. During the Track Record Period, we terminated 134 property management services agreements, of which 70 property management services agreements were voluntarily terminated, primarily due to (i) other parties’ failure to make payments; (ii) our decision to reallocate our resources to more profitable engagements to optimize our project portfolio; and (iii) we voluntarily withdrew from retention tender process due to intense competition.

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VALUE-ADDED SERVICES TO PROPERTY DEVELOPERS

Our value-added services to property developers primarily include sales office management services. In 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, we generated RMB152.5 million, RMB123.2 million, RMB108.5 million, RMB27.3 million and RMB28.0 million, respectively, from sales office management services.

We offer property management services to sales offices and display units for property developers, such as security services, cleaning services and reception services. We provide sales office management services through our own employees and third-party subcontractors. We typically charge a fixed monthly fee for our sales office management services, taking into consideration factors such as the nature and scope of the services, the headcount and positions of the staff we deploy and the size and location of the properties involved. As of December 31, 2018, 2019 and 2020 and March 31, 2021, we managed 111, 128, 118 and 119 sales offices, respectively, with GFA under management of 1.7, 2.2, 2.6 and 2.6 million sq.m., respectively.

COMMUNITY VALUE-ADDED SERVICES

We offer community value-added services to property developers, property owners, residents and tenants, including (i) space management services; (ii) community shopping services; (iii) home-living services; and (iv) car parks management services. We provide these services through our daily interactions with the property owners and residents and our “EINYUN Life (一應生活)” mobile application. The following table sets forth a breakdown of our revenue from community value-added services for the periods indicated, both in absolute amount and as a percentage of our revenue from community value-added services.

For the year ended December 31, For the three months ended March 31, 2018 2019 2020 2020 2021 RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 % (Unaudited)

Space management services 30,700 13.0 42,486 13.1 32,511 8.9 4,014 4.5 6,854 6.3 Community shopping services 257 0.1 1,780 0.6 2,701 0.7 319 0.4 925 0.9 Home-living services 8,405 3.6 22,969 7.2 50,800 13.8 3,248 3.6 5,357 5.0 Car parks management services 196,789 83.3 254,002 79.1 282,292 76.6 81,811 91.5 94,400 87.8

Total 236,151 100.0 321,237 100.0 368,304 100.0 89,392 100.0 107,536 100.0

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Space management services

Our space management services primarily include (i) leasing spaces in elevators and parking garages, exterior walls and other advertising spaces to third-party vendors; (ii) leasing certain common areas on behalf of property owners as venues for public activities; and (iii) providing inspection and security services for property owners’ home decoration and construction work. We provide space management services mainly through our employees. Typically we enter into separate leasing or service agreements with third-party tenants, and collect a certain percentage or a fixed amount of the rental proceeds as our service fees. For our inspection and security services, we typically charge a fixed fee on a per sq.m. basis.

Community shopping services

We intend to maximize convenience and provide an enjoyable life to residents by offering platform for online shopping. We offer a full range of groceries, seasonal products and other daily necessities, procured from preselected third-party suppliers. Residents may place orders through our “EINYUN Life (一應生活)” mobile application and “EINYUN Youxuan” (一應優選) WeChat mini program. Such services are provided primarily through our employees.

Home-living services

• Residential decoration and furnishing services. We provide residential decoration and furnishing services to property owners and residents, which help them create a move in ready residence. We enter into separate agreements with property owners or residents and engage subcontractors to carry out the decoration projects. We charge property owners and residents a service fee and pay external construction teams out of such fee.

• Construction material and furniture sale services. We offer construction material and furniture sale services to property owners and residents, helping them purchase construction materials for home decoration, furnitures and home appliances. We enter into agreements with third-party merchants and make available their products and services to property owners and residents. Based on the orders received from property owners and residents, the third-party merchants will make deliveries to them. We usually charge fees for construction materials and furniture products based on market price and settle the purchase costs to third-party merchants.

• Catering services. We provide catering services to property owners, employees of property developers and residents through our subsidiary Xi'an Yiying Qingteng Catering Management Co., Ltd.. and subcontractors. Our services include (i) meal preparing; (ii) repairing and maintaining facilities and equipment in the dining area; (iii) cleaning services; (iv) sales of commodity goods and snacks; (v) managing the dining area; and (vi) other services that are related with canteen management and food preparation as specified in the service agreements. We charge a fixed percentage of the sales amount as our fees for catering services.

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• Featured services. Upon the request of property owners, residents and tenants, we offer featured services, such as maintenance and repair, cleaning and green plant rental services. We offer these services either through our own employees or through sub-contractors. We directly work with property owners, residents and tenants who request such services and charge for our services according to market price. If we engage subcontractors to provide these services, we pay the relevant cost to them.

Car parks management services

We provide car parks management and operation services to property developers, property owners, tenants and residents with regard to certain car park spaces. Our services primarily include entry or exist control, cleaning and maintenance services, surveillance and collection of parking fees. We typically charge a certain percentage of the operating income generated from the car parks under management as our service fee. We offer these services through our own employees and subcontractors.

PROFESSIONAL SERVICES

We provide various professional services to property developers, property owners, property management companies, government agencies, transportation hubs and other companies with elevator related businesses, including (i) construction and installation engineering services; (ii) elevator related services; and (iii) smart integrated operation platform services. The following table sets forth a breakdown of our revenue from professional services for the periods indicated, both in absolute amount and as a percentage of our revenue from professional services.

For the year ended December 31, For the three months ended March 31, 2018 2019 2020 2020 2021 RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 % (Unaudited)

Construction and installation engineering services 85,101 77.5 112,238 66.2 159,384 65.4 26,089 68.7 34,083 84.9 Elevator related services 24,710 22.5 41,487 24.4 51,314 21.1 7,347 19.4 4,918 12.2 Smart integrated operation platform services – − 16,038 9.4 32,766 13.5 4,528 11.9 1,151 2.9

Total 109,811 100.0 169,763 100.0 243,464 100.0 37,964 100.0 40,152 100.0

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Construction and Installation Engineering Services

We provide construction and installation engineering services through our subsidiary Changcheng Louyu Technology to property owners and property developers. We carry out installation and construction works, including but not limited to the design, installation and upgrading of building intelligent system, security system, fire protection system, power supply system, drainage system and air-conditioning system, as well as engineering consulting services. We generally charge our fees based on a markup on top of the costs incurred for our services on a per-transaction basis based on the scope of the project, the amount of construction materials and the technical expertise and manpower required.

Elevator Related Services

We provide sales, installation, renovation, repair and maintenance and technical consultation services of elevators, escalators and travellators and sell spare parts of elevators, escalators and travellators to property management companies, property developers, property owners’ associations and other companies with elevator related businesses through our subsidiary Changcheng Louyu Technology, which hold relevant qualification in providing such services. As of March 31, 2021, Changcheng Louyu Technology has installed 89 elevators and provided renovation, repair and maintenance and technical consultation services for over 9,000 elevators, 300 escalators and 20 travellators. These projects include office buildings, commercial complex, public properties, restaurants, industrial parks, hotels and exhibitions.

During the Track Record Period, we determined the cost of elevator related services according to the following methods: (i) for the sale of elevators, escalators and travellators, we charge a fixed percentage of the sales price as our commission from sales or factory agents; (ii) for the installation services, renovation services, repair and maintenance services, and technical consulting services for elevators, escalators and travellators, we charge service fees on a per-transaction basis, as well as costs of the raw materials, such as spare parts, and equipments used in the projects. We charge agency commissions and installation service fees according to fixed rates set by elevators, escalators and travellators suppliers.

Smart Integrated Operation Platform Services

We primarily provide smart integrated operation platform services through our EINYUN Cloud platform, developed and administered by Yiying Community Technology Group. Our EINYUN Cloud platform comprises multiple modules, such as Customer Management (一應客服), Bills Management (一應賬房), Service Assignment (一應物管) and Equipment Management (一應物聯), covering critical phases of the operation of property management companies and aims to help our users, primarily small or medium property management companies to achieve management digitalization, service and procedure standardization, and operation upgrade. As of March 31, 2021, our EINYUN Cloud platform served over 600 enterprises. We also provide customized software development services for our users, catering to the specific requirements in their daily operation and management. We charge a pre-determined annual fee or on a per transaction basis for our smart operation platform services.

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OUR MOBILE APPLICATIONS

We connect our back end EINYUN Cloud service platform with our customers and staff through three mobile applications EINYUN Life (一應生活), EINYUN Service (一應智能) and Alliance Purchase (聯盟購).

Our EINYUN Life mobile application allows our customers to easily request our services, in particular community value-added services. We designed or selected the functions of our EINYUN Life mobile application to enhance user engagement based on our understanding of the habits and preferences of the residents, which we gained through our frequent and long-term interactions with the residents. As of the Latest Practicable Date, we provided property owners and residents the following services through our EINYUN Life mobile application:

• Property management services mainly include (i) intelligent access: property owners and residents may gain access control to his or her building and apartment via our EINYUN Life mobile application; (ii) online payment: property owners and residents can pay property management fees on the mobile application through third-party payment channels; (iii) repair and maintenance: residents can request repair and maintenance services through the mobile application; (iv) community notices: property owners and residents can get notifications related to the property management services in the community; and (v) service feedback: residents can comment on our services on the mobile application and view the results.

• Community value-added services include (i) community shopping services: we offer high-quality goods procured from quality third-party suppliers and provide our users with online shopping services according to their daily needs; and (ii) home living services: property owners and residents can request home cleaning services through our mobile application. Property owners and residents can also get notified and register for community social events through our EINYUN Life application.

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Meanwhile, our EINYUN Service mobile application enables our employees to access standardized service procedures, monitor the service requests and collect feedback from our customers. Specifically, any request submitted by customers on the mobile application will be relayed to our corresponding employee by the EINYUN Service system. The responsible employee would be able to receive notice for and respond to such customer request, and continue to track the status of completion and resident feedback.

We also provide centralized procurement services through our Alliance Purchase mobile application, where property management companies and other companies with related businesses could place order for raw material and other supplies, and we can bargain for price discounts with third-party suppliers by leveraging the aggregated purchase power of our users.

According to the Administrative Measures on Internet Information Services《互聯 ( 網信息服務管理辦法》) issued by the State Council which came into effect on September 25, 2000 and was revised on January 8, 2011, Internet information services refer to the provision of information to web users through the Internet, which can be divided into commercial Internet information services and non-commercial Internet information services. Entities engaging in providing commercial Internet information services shall apply for a license for value-added telecommunication services of Internet information services. As for the operations of non-commercial Internet information services, only filings with the relevant authority of the PRC Government are required.

As advised by our PRC Legal Advisor, as of the Latest Practicable Date, (i) services we offered through EINYUN Life and Alliance Purchase should be regarded as “non-commercial Internet information services” as the revenue we generated from such services were from (a) sales of products we procured from third-party suppliers and then provided to our customers in our own name and (b) the property management services and community value-added services we provided to the customers. Our customers do not need to pay for the Internet information services provided by us; (ii) necessary filings and registrations in respect of such business have been obtained and completed; and (iii) non-commercial Internet information services does not belong to the category of basic telecommunication services or value-added telecommunication services and, as a result, a license for value-added telecommunication services is not required.

During the Track Record Period, in addition to the above mentioned non-commercial Internet information services, we also offered certain commercial Internet information services, such as paid advertisements for products of third-party merchants, through our online service platforms, including EINYUN Life. During the Track Record Period, our total revenue from such commercial Internet information services amounted to approximately RMB1.2 million. We have decided to cease offering such services and applied for the cancellation of the relevant license. As of the Latest Practicable Date, the ICP Certificates had been canceled. Considering the aggregate revenue attributable to commercial Internet information services accounted for approximately 0.1% of our Group’s total revenue from community value-added services during the Track Record Period, we believe that ceasing commercial Internet information services should not have any material adverse effect on our financial performance.

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Data Security and Privacy

We have adopted various internal control measures to ensure data security and privacy protection in relation to our internal operational data, as well as external data, such as customer data obtained through our information systems. We have displayed the terms and conditions to customers and have also gained their prior consent before collecting their data. We may collect customer data to the extent necessary for us to provide our services, mainly including customer name, telephone number, age, address, biometric data, shopping behaviors and other information. We retain such personal information of property owners and residents when they remain as property owners and/or residents of the properties managed by us. We only use a specific customer’s information to the extent that it is needed for our services to such customer. We classify our staff based on their positions and responsibilities and grant them different access rights so that only necessary personnel could access certain confidential information after obtaining internal approval. All unnecessary access to our database is prohibited. We maintain and regularly check our system logs, in which all activities that involve accessing private data are recorded. In addition, we carry out maintenance and firewall upgrades to ensure information stored is adequately protected.

OUR BRANDS

We market our services under mainly one brand, namely, Changcheng Property Management, which encompasses three branches, Ruijia (睿家) for residential properties, Junxi (君璽) for commercial properties and Ruiying (睿應) for public properties, each catered to a specific customer group. The brands are designed to indicate the expected scope and standards of services provided. We believe that these brands help us to provide unified and clear messages about the type and level of services that we provide and enable us to maximize our market share by leveraging this differential positioning strategy to attract different customer groups.

SALES AND MARKETING

The market development center at our headquarters and market development departments at our regional companies are primarily responsible for developing our marketing strategy and objectives, conducting and preparing market research, design and upgrade our service offerings, developing our brands, and maintaining client relationships and public relations. The marketing development center at our headquarters is in charge of overall strategic planning and implementation of our market expansion plan, and guiding, coordinating, supporting, supervising and evaluating the market development departments. The market development departments are in charge of market expansion efforts in their respective regions, including conducting market research, identifying potential business opportunities, commercial negotiations and customer management. We organized marketing training for our employees on a regular basis. As of the end of 2020, our market development team consisted of over 300 members.

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For the year ended December 31, 2018, 2019 and 2020 and the three months ended March 31, 2021, our total expenditures for sales and marketing amounted to RMB58.7 million, RMB83.4 million, RMB113.0 million and RMB14.0 million, respectively.

CUSTOMERS

Overview

Our customer base primarily consists of property developers, property owners, residents, tenants, state-owned enterprises and government agencies. We assess prospective customers by evaluating key factors such as estimated costs involved with property management, historical fee collection rates, projected profitability as well as whether the property was previously managed on a lump sum or commission basis. We typically do not grant credit terms to property owners for the property management fee we charge. For value-added services to property developers and community value-added services, we may grant credit term to our customers pursuant to the terms of the property management service agreements, depending on the type of services we provide.

The table below sets forth the main types of our major customers for each of our four business lines:

Business Lines Major Customers

Property management services Property owners, residents and tenants, property developers

Value-added services to Property developers property developers

Community value-added Property owners, residents and tenants services and property developers

Professional services Property owners, property developers, third-party merchants and other property management companies

In 2018, 2019 and 2020 and the three months ended March 31, 2021, revenue from our five largest customers, which were all Independent Third Parties, amounted to RMB216.3 million, RMB183.4 million, RMB159.4 million and RMB31.9 million, respectively, accounting for 9.0%, 6.6%, 5.2% and 4.1% of our total revenue for the same periods, respectively. During the Track Record Period, we provided to our largest customer property management services. In 2018, 2019 and 2020 and the three months ended March 31, 2021, revenue generated from our services provided to our largest customer of the particular year amounted to RMB154.5 million, RMB141.4 million, RMB88.3 million and RMB10.3 million, respectively, accounting for 6.4%, 5.0%, 2.9% and 1.3% of our total revenue, respectively.

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Our Top Five Customers

The following table sets forth details of our top five customers in 2018:

Length of Percentage of business Transaction our total relationship amount revenue Relationship Ranking Customer Customer type Major services provided as of year end for the year (1) for the year with us RMB’000 %

1. Customer A Property Developer Property management 8 years 154,536 6.4 N/A services

2. Customer B Property Developer Property management 3 years 26,203 1.1 N/A services

3. Customer C Internet Service Provider Property management 8 years 12,463 0.5 N/A services

4. Customer D Company that engages in Property management 3 years 11,711 0.5 N/A commercial operation services management

5. Customer E Exhibition Servicer Property management 5 years 11,373 0.5 N/A services

Note:

(1) Refers to the transaction amount with the relevant customer before tax.

The following table sets forth details of our top five customers in 2019:

1. Customer A Property Developer Property management 9 years 141,428 5.0 N/A services

2. Customer C Internet Service Provider Property management 9 years 12,950 0.5 N/A services

3. Customer D Company that engages in Property management 4 years 10,413 0.4 N/A commercial operation services management

4. Customer F Government Agency Property management 12 years 9,930 0.4 N/A services

5. Customer B Property Developer Property management 4 years 8,712 0.3 N/A services

Note:

(1) Refers to the transaction amount with the relevant customer before tax.

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The following table sets forth details of our top five customers in 2020:

Length of Percentage of business Transaction our total relationship amount revenue Relationship Ranking Customer Principal business Major services provided as of year end for the year (1) for the year with us RMB’000 %

1. Customer A Property Developer Property management 10 years 88,337 2.9 N/A services

2. Customer G Telecommunication Property management 2 years 21,873 0.7 N/A Company services

3. Customer C Internet Service Provider Property management 10 years 18,930 0.6 N/A services

4. Customer H Transportation Company Property management 2 years 18,260 0.6 N/A services

5. Customer I Company that runs Professional services 3 years 12,029 0.4 N/A Internet of Things

Note:

(1) Refers to the transaction amount with the relevant customer before tax.

The following table sets forth details of our top five customers in the three months ended March 31, 2021:

Length of business Percentage of relationship Transaction our total as of the end amount revenue Relationship Ranking Customer Principal business Major services provided of the period for the period (1) for the period with us RMB’000 %

1. Customer A Property Developer Property management 11 years 10,341 1.3 N/A services

2. Customer C Internet Service Provider Property management 11 years 7,608 1.0 N/A services

3. Customer H Transportation Company Property management 3 years 5,241 0.7 N/A services

4. Customer G Telecommunication Property management 3 years 4,457 0.6 N/A Company services

5. Customer J Insurance company Property management 2 years 4,246 0.5 N/A services

Note:

(1) Refers to the transaction amount with the relevant customer before tax.

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During the Track Record Period, our five largest customers generally paid us through bank transfers, and there was no substantial difference among our five largest customers in terms of payment terms for similar services under similar circumstances. During the Track Record Period and up to the Latest Practicable Date, none of our Directors, their respective close associates or our Shareholders who, to the best knowledge of our Directors, owned more than 5% of the total number of issued Shares held any interest in any of our five largest customers. During the Track Record Period, none of our five largest customers was also our supplier.

SUPPLIERS

Overview

For all four of our business lines, our suppliers are primarily subcontractors located in China which provide security, cleaning, greening and gardening services and dispatched workers. We outsource those services to lower our cost of services and improve our service quality. Our subcontractors specialize in the services they perform and operate in an efficient manner. We believe that such subcontracting arrangements allow us to leverage the human resources and technical expertise of our subcontractors, reduce our labor costs and enhance our overall profitability.

The table below sets forth the main types of our major suppliers for each of our four business lines:

Business Lines Major Suppliers

Property management services Subcontractors providing security services, cleaning and greening services, and common area facility repair and maintenance services

Value-added services to Subcontractors providing customer reception property developers and cleaning services

Community value-added Property developers providing parking spaces, services subcontractors providing repair and maintenance services, and suppliers of merchandise under our community shopping services

Professional services Suppliers of raw materials and relevant equipments

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The following table sets forth details of our top five suppliers in 2018:

Length of business Transactional Percentage of Major products/ relationship amount total purchases Relationship Rank Supplier Supplier type services provided as of year end for the year (1) for the year with us RMB’000 %

1. Supplier A Service provider Security services 7 years 43,769 3.1 N/A

2. Supplier B Service provider Security services 4 years 36,925 2.7 N/A

3. Supplier C Service provider Security services 9 years 20,950 1.5 N/A

4. Supplier D Service provider Security services 2 years 13,535 1.0 N/A

5. Supplier E Trading company Goods 2 years 12,284 0.9 N/A

Note:

(1) Refers to the transaction amount with the relevant supplier before tax.

The following table sets forth details of our top five suppliers in 2019:

1. Supplier A Service provider Security services 8 years 51,500 3.3 N/A

2. Supplier B Service provider Security services 5 years 51,238 3.3 N/A

3. Supplier C Service provider Security services 10 years 24,868 1.6 N/A

4. Supplier D Service provider Security services 3 years 20,552 1.3 N/A

5. Supplier E Trading company Goods 3 years 16,120 1.0 N/A

Note:

(1) Refers to the transaction amount with the relevant supplier before tax.

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The following table sets forth details of our top five suppliers in 2020:

1. Supplier A Service provider Security services 9 years 52,102 3.2 N/A

2. Supplier B Service provider Security services 6 years 45,240 2.8 N/A

3. Supplier D Service provider Security services 4 years 30,292 1.9 N/A

4. Supplier C Service provider Security services 11 years 24,521 1.5 N/A

5. Supplier E Trading Company Goods 4 years 23,020 1.4 N/A

Note:

(1) Refers to the transaction amount with the relevant supplier before tax.

The following table sets forth details of our top five suppliers in the three months ended March 31, 2021:

Length of business relationship Transactional Percentage of Major products/ as of the end amount total purchases Relationship Rank Supplier Supplier type services provided of the period for the period(1) for the period with us RMB’000 %

1. Supplier B Service provider Security services 7 years 10,895 2.8 N/A

2. Supplier A Service provider Security services 10 years 10,126 2.6 N/A

3. Supplier D Service provider Security services 5 years 9,125 2.3 N/A

4. Supplier C Service provider Security services 12 years 6,731 1.7 N/A

5. Supplier F Service provider Security services 7 years 5,844 1.5 N/A

Note:

(1) Refers to the transaction amount with the relevant supplier before tax.

We do not have any long-term agreements with our top five suppliers. We typically enter into one-year agreements with our suppliers and renew them on an annual basis. Payments to suppliers are typically settled by month via bank transfers.

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All of our five largest suppliers during the Track Record Period were Independent Third Parties. As of the Latest Practicable Date, none of our Directors, their respective close associates or our Shareholders who, to the best knowledge of our Directors, owned more than 5% of the total number of issued Shares held any interest in any of our five largest suppliers. In 2018, 2019 and 2020 and the three months ended March 31, 2021, purchases from our five largest suppliers amounted to RMB127.5 million, RMB164.3 million, RMB175.2 million and RMB42.7 million, respectively, accounting for 9.2%, 10.5%, 10.8% and 10.9% of our total purchases for the same periods, respectively.

Selection and Management of Our Subcontractors

We select our subcontractors through tender process and enter into annual subcontracting agreements with the selected parties. We regularly monitor and evaluate our subcontractors. Our operation centers for each region are expected to evaluate the work of subcontractors on a monthly basis in accordance with our well-established internal standards and grade the subcontractors based on their performances. Such grades will impact the contract sum payable for the relevant month and form the basis for our decision to renew or terminate the contractual relationship with the subcontractor.

Key Terms of Our Subcontracting Agreements

Our subcontracting agreements typically include the following key terms:

• Term. Such agreements are typically signed for one-year terms and may be renewed by mutual consent. We will consider re-engaging the subcontractors based on the quality of their services.

• Performance standards. The subcontracting agreement would set forth the scope and expected standards of the subcontractor’s services, including areas to which the subcontracting services relate, frequency for such service and the types of inspections we require.

• Our rights and obligations. Generally, we have both the right and obligation to supervise and evaluate our subcontractors. We are also responsible for providing them with the necessary support for the completion of their services, which may include, for example, the use of office space. We generally pay subcontracting fees on a monthly basis. We are generally entitled to collect damages for breach of contract or deduct subcontracting fees if our subcontractors fail to adhere to our performance scope and standards.

• Rights and obligations of subcontractors. The subcontractor is entitled to receive timely payment of subcontracting fees in accordance with our agreement. The subcontractor is typically responsible for providing services in accordance with the scope, frequency and standards prescribed in the relevant subcontracting agreement and in compliance with all applicable laws and regulations. In the event of sub-standard performance, subcontractor is required to take necessary rectification measures within the period required by us, failing which we have the right to hire alternative subcontractors to

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provide the contracted services and adjust the contract price agreed with the nonperforming or underperforming subcontractor, or terminate the contract. The subcontractor is required to manage its personnel providing the contracted services in accordance with the standards set out in the agreement.

• Risk allocation. Our subcontractors are responsible for the management of their own employees, with whom we have no employment relationship. Our subcontractors are responsible for purchasing necessary insurance for their own employees and compensating their own employees who suffer damages to person or property in the course of providing the contracted services. They are also responsible for damages to, or losses of, any person or property arising out of the default of such subcontractor in the course of providing the contracted services.

• Termination and renewal. We monitor and assess the performance of the subcontractor on a regular basis and can terminate the subcontracting agreement in the event of repeated sub-standard performance.

QUALITY CONTROL

Quality Control of Our Property Management Services

We obtained, among others, the ISO 9001:2015 quality management system certification, the ISO 14001:2015 environment management system certification, ISO 45001:2018 international occupation health and safety management system certification, ISO 50001 energy management system certification and IEC 27001:2013 information security management system certification in recognition of our service quality. See “—Occupational Health, Safety and Environmental Matters” below for more details.

To ensure the effective and consistent delivery of our high quality services, we have established various procedures and systems to monitor and maintain the quality of our services across all our managed projects.

• Customer feedback collection. We keep tracking out customers’ feedbacks on our service quality. We supervise and review the issue handling process in our internal claim and complaint report system or platforms. We have two customer complaint channels including a 400 service hotline which deals with customer complaints by all individual customers, our EINYUN Life mobile application and a WeChat service account operated by our quality control working committee where our customers, employees, partners, suppliers and contractor can submit complaints directly to our Compnay.

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• Quality and standard inspection. Our quality control working committee at the headquarter and regional companies are responsible for coordinating and conducting inspections in accordance with our internal quality control procedures and standards. The result of quality and standard inspections will be released internally through our management system and affect the performance grading for each regional company.

• Independent third-party surveys. We engage CIA annually to conduct customer satisfaction survey to assess our service quality for properties under our management. According to CIA, our overall satisfaction score was 85.8 out of 100 in 2020.

To ensure consistent and high-quality services, we strive to standardize our property management services across all our managed projects. See “—Competitive Strengths” for more information.

Quality Control of Subcontractors

We typically include in the agreements with subcontractors detailed quality standards and procedures for the services to be provided. We regularly monitor and evaluate the performance of the subcontractors and may require the subcontractors to take necessary rectification measures when their services do not meet the agreed standards. We also conduct annual surveys among property owners and residents regarding the quality of services provided by our subcontractors. We have the contractual right to adjust the subcontracting fees and decide whether to continue our subcontracting contract depending on the outcomes of our evaluations. See “—Suppliers—Selection and Management of Our Subcontractors.”

Quality Control of Third-party Vendors

We implement a variety of measures and policies to ensure the quality of the products and services offered by third-party vendors, such as selecting vendors based on our internal quality control policy and grading the quality of the products or services of the selected vendors with ongoing review. We establish monthly and quarterly quality checks to monitor our third-party vendors. If third-party vendors are unable to provide the required products, they must notify us in time. They are also required to indemnify us for losses incurred due to their defective products. We also have the right to replace a third-party vendor in the event of underperformance.

Feedback and Complaint Management

We believe that our customers are crucial to our business and value their feedbacks and suggestions. During the ordinary course of our business operations, we receive feedback, suggestions and complaints from property owners and residents of the properties we manage from time to time regarding our quality and effectiveness of services. In order to manage our customers’ feedbacks and complaints in a timely and effectively manner, we provide a broad range of channels for customers to easily and

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During the Track Record Period and up to the Latest Practicable Date, we did not experience any customer complaints about our services or products that would have a material adverse impact on our operations or financial results.

INTELLECTUAL PROPERTY

We regard our intellectual property rights material to our business. As of the Latest Practicable Date, we had registered six trademarks, five copyrights, five patents and one domain name in the PRC, which in the opinion of our Directors, are material to our business. See “Statutory and General Information—B. Further Information about Our Business—2. Intellectual Property Rights of Our Group” in Appendix VII to this document for more information. As of the Latest Practicable Date, we were not aware of any infringement which could have a material adverse effect on our business operations by our Group against any intellectual property rights of any third party or by any third party against any intellectual property rights of our Group, or any disputes with third parties with respect to intellectual property rights.

EFFECTS OF THE COVID-19 OUTBREAK

Effects of the COVID-19 Outbreak on Our Business Operations

COVID-19 has spread across the PRC and globally since early 2020. To contain the COVID-19 pandemic, the PRC Government has imposed strict measures across the PRC since late January 2020, including lock-down measures across various cities in the PRC, the extended shutdown of business operations, and mandatory quarantine requirements on infected individuals and anyone deemed potentially infected. In addition, the PRC Government and its local counterparts have also adopted various incentive policies to boost the economy, such as cutting taxes, increasing government investment and increasing the amount of currency issued. The combination of fiscal and monetary incentives could ease the negative impact of the COVID-19 pandemic.

In the short term, for our property management services, the commercial properties under our management experienced temporary disruption in their operation as a result of the quarantine measures imposed by the PRC government in response to COVID-19. To a less extent, our value-added services to property developers and professional services were also affected by the general slowdown of business activities in early 2020 due to the impact of COVID-19. For residential properties under our management and for our community value-added services, we did not encounter material disruption in operation due to COVID-19 and the lockdown measures imposed in many regions have also led to residents’ increasing reliance on our services to address their daily living needs, which presents us significant opportunities to expand our community shopping services and home living services. As a whole, we do not expect the COVID-19 pandemic to have a significant impact on our business operation or financial position. Despite the outbreak of

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Since the outbreak of COVID-19 and up to the Latest Practicable Date, we had not encountered any material disruption to the services provided by our sub-contractors and utilities service providers and the supply of materials from our suppliers. Our Directors consider that while the supply chains in all industries were disrupted to a certain extent by the outbreak of COVID-19, in view of the nature of our business, our Directors do not expect that our Group will encounter any material disruptions of our supply chain given that we do not rely on any particular service sub-contractors or material suppliers and there are many other readily available subcontractors and suppliers in the market as backups. In view of the foregoing, our Directors are confident that our Group can continue to provide our services and discharge our obligations under existing contracts. In addition, our Directors believe that it creates an opportunity for us to further develop our community retail services and to establish a more bonded relationship with our residents since we also take extensive preventive measures to safeguard the hygiene of the community and the health of our residents during the outbreak, which may enhance our brand value and customer loyalty.

Unlike other industries such as retail and manufacturing which may be subject to extensive or even complete suspension of operations for a period of time as a result of the COVID-19 outbreak, given the nature of our business operations, our Directors are of the view that the risk of our Group having to suspend our operations is remote. In the unlikely event that we are forced to reduce or suspend part of our business operations as a result of the COVID-19 outbreak, whether due to government policy or any other reasons beyond our control, our Directors are of the opinion that, after taking into account the financial resources available to us including the estimated net proceeds of the [REDACTED] and our expected cash generated from operating activities, we will have sufficient working capital to satisfy our requirements for at least the next 12 months

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The abovementioned analysis is for illustrative purpose only and our Directors currently assessed that the likelihood of such situation is remote. The actual impact caused by the outbreak of COVID-19 will depend on its subsequent development. Therefore, it is possible that such impact to our Group may be out of our Director’s control and beyond our estimation and assessment.

Our Contingency Plan and Response towards the COVID-19 Outbreak

Effects of the COVID-19 Outbreak on Our Business Strategies

Currently, it is one of our business strategies to continue to expand our geographic presence and business. According to CIA, the outbreak of COVID-19 is expected to cause certain short-term economic slowdown across China but it will unlikely affect the regional macroeconomic development plan and talent recruitment plan in the long term in China, and it is expected that once the outbreak is effectively controlled, the outlook for demand of residential property management services in these cities will remain positive. We therefore believe that our expansion plan as discussed in “—Business Strategies” is feasible, and it is unlikely that we would change the use of the net proceeds from the [REDACTED] as disclosed in “Future Plans and Use of Proceeds” in this document as a result of the COVID-19 outbreak.

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AWARDS AND RECOGNITIONS

The following tables set forth some of our awards received during the Track Record Period and up to the Latest Practicable Date:

Year Award/Recognition Awarding entity

2021 2021 Top 100 China Property China Index Academy Management Companies (中國指數研究院) (2021中國物業服務百強企業)

2021 2021 China Top 10 Property China Index Academy Management Companies in (中國指數研究院) terms of Business Size (2021中國物業服務百強企業服務規模TOP 10)

2021 2021 China Leading Property China Index Academy Management Companies in (中國指數研究院) terms of Independent Operation (2021年中國物業管理行業市場化運營領先企業)

2021 2021 China Leading Property China Index Academy Management Companies in (中國指數研究院) terms of Characteristic Service – EINYUN Cloud (2021中國特色物業服務領先企業－一應雲)

2021 2021 China Leading Property China Index Academy Management Companies in (中國指數研究院) terms of Customer Satisfaction (2021中國物業服務百強滿意度領先企業)

2020 Ranked eighth among the 2020 Shanghai Yiju Real Estate Top 10 Property Management Research Institute, Companies in China in terms China Real Estate of Overall Strength Evaluation Center and Beijing (2020年物業服務企業綜合實力 Zhongwu Yanxie Information 10強第8名) Technology Co., Ltd. (上海易居房地產研究院、中國房地產測評中心、北京中物研協信息科技有限公司)

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Year Award/Recognition Awarding entity

2020 2020 Top 100 Most Valuable Shanghai Yiju Real Estate Brand of Property Research Institute, Management Service China Real Estate (2020年物業服務企業品牌價值 Evaluation Center and 100強) Beijing Zhongwu Yanxie Information Technology Co., Ltd. (上海易居房地產研究院、中國房地產測評中心、北京中物研協信息科技有限公司)

2020 2020 Independent Operation Shanghai Yiju Real Estate Leading Companies in Research Institute, Property Service Industry China Real Estate (2020年物業服務市場化運營領 Evaluation Center and 先企業) Beijing Zhongwu Yanxie Information Technology Co., Ltd. (上海易居房地產研究院、中國房地產測評中心、北京中物研協信息科技有限公司)

2020 Benchmark Integrity Enterprise Guangzhou Property (誠信標桿企業) Management Industry Association (廣東省物業管理行業協會)

2020 2020 Top 100 Blue-Chip The Economic Observer Property Management (經濟觀察報) Companies (2020藍籌物業百強企業)

2020 Well-known Property Guangzhou Property Management Enterprises in Management Industry Greater Bay Area in 2020 Association (2020大灣區物業服務品牌企業) (廣東省物業管理行業協會)

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Year Award/Recognition Awarding entity

2019 2019 Top 50 Most Valuable China Property Management Brand of Property Institute, Shanghai Yiju Management Service Real Estate Research Institute (2019年物業服務企業品牌價值 and China Real Estate 50強) Evaluation Center (中國物業管理協會、上海易居房地產研究院、中國房地產測評中心)

2019 2019 Featured Brand of China Property Management Property Management Service Institute, Shanghai Yiju (2019年特色物業服務品牌企業 Real Estate Research Institute －社區生態運營商) and China Real Estate Evaluation Center (中國物業管理協會、上海易居房地產研究院、中國房地產測評中心)

2019 2019 Top 500 Property China Property Management Management Companies in Institute, Shanghai Yiju China in terms of Real Estate Research Institute Overall Strength and China Real Estate (2019年物業服務企業綜合實力 Evaluation Center 500強) (中國物業管理協會、上海易居房地產研究院、中國房地產測評中心)

2019 2019 Platform Leading Brand China Index Academy of China Property (中國指數研究院) Service Companies (2019中國物業服務平台領先品牌)

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Year Award/Recognition Awarding entity

2019 2019 China Leading Property China Index Academy Management Companies in (中國指數研究院) terms of Independent Operation (2019年中國物業服務行業市場化運營領先企業)

2019 2019 China Leading Property China Index Academy Management Companies in (中國指數研究院) terms of Characteristic Service – EINYUN Cloud (2019中國特色物業服務領先企業－一應雲智慧平台)

2019 2019 China Top 100 Property China Index Academy Management Companies (中國指數研究院) (2019年中國物業服務百強企業)

2018 2018 Top 100 Property China Property Management Management Companies of Institute, Shanghai Yiju China in terms of Real Estate Research Institute Overall Strength and China Real Estate (2018年物業服務企業綜合實力 Evaluation Center 測評TOP 100) (中國物業管理協會、上海易居房地產研究院、中國房地產測評中心)

2018 2018 China Leading Property China Index Academy Management Companies in (中國指數研究院) terms of Independent Operation (2018中國物業服務行業市場化運營領先企業)

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COMPETITION

The property management industry in the PRC is intensely competitive and highly fragmented with a few sizeable companies and numerous small-sized market participants. According to CIA, the property management industry is becoming more and more centralized and the divergence trend of companies at different levels is increasing. Sizeable companies with professional knowledge, financial strength and background or affiliation with property developers are more competitive and are at a more advantageous position in the market. Moreover, according to CIA, there are several barriers for players in China’s property management industry to successfully compete and achieve sustainable growth, such as brand value, capital requirements, quality of management and availability of talent and technical expertise, which we believe we have and will continue to overcome. Therefore, although the PRC property management industry has relatively low entry barriers for the mid-tier and low-end segments, we believe that there are relatively higher entry barriers for the high-end segment.

As a reputable player in comprehensive property management segment, according to the CIA report, we primarily compete against large national, regional and local property management companies. We believe the core competitiveness lies in factors including, among other things, quality of services, business operation, price, financial resources, brand recognition and reputation. We actively apply technology and intelligent system and cloud platform to improve our property management service. We operate and rank as the largest independent comprehensive property management service provider in China and achieve outstanding results without relying on the support of parent property developer company, which demonstrates our strong promotion and marketing strength and high-standard property service quality.

According to CIA report, we were ranked:

• Top ten among Top 100 Property Management Companies in China in terms of overall strength for the consecutive 13 years;

• Tenth among the 2021 Top 100 Property Management Companies in China in terms of overall strength;

• Twelfth among the 2021 Top 100 Property Management Companies in China in terms of the GFA under management.

For more details about the industry and markets that we operate in, please refer to the section entitled “Industry Overview” in this document.

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OCCUPATIONAL HEALTH, SAFETY AND ENVIRONMENTAL MATTERS

We are subject to PRC laws and regulations in relation to labor, safety and environment protection matters. We have established occupational safety and sanitation systems, implemented the ISO 45001:2018 occupational health and safety management system standards in our operations, and provided employees with workplace safety trainings on a regular basis to increase their awareness of work safety issues. We have monthly training for our employees on occupational safety. We regularly organize relevant departments to identify, evaluate and control the source of hazard. We establish a standardized process covering from accident management to reporting and investigation in terms of work-related injury. We also put risk evaluation methods in place for classification of operation risks. Moreover, we attach importance to our employees’ safety and provide protection equipment such as gloves and gas masks when in need. During the Track Record Period and up to the Latest Practicable Date, we had complied with PRC laws and regulations in relation to workplace safety in all material respects and had not had any incidents which have materially and adversely affected our operations.

We consider the environmental protection important and are committed to operating our business in compliance with applicable environmental protection laws and regulations. We have implemented reasonable measures in the operation of our businesses to comply with all applicable requirements to ensure we meet the ISO 14001 standard. We also have training for our employees on ISO 14001 standard. We regularly identify, evaluate, control significant environmental factors related to ISO 14001 standard and accept external review. Given the nature of our operations, we do not believe we are subject to material environmental liability risk or compliance costs. During the Track Record Period and up to the Latest Practicable Date, we have not been subject to any material administrative penalties due to violation of environmental laws in the PRC.

Our Directors consider that establishing and implementing sound environmental, social and governance (“ESG”) principles and practices will help increase the investment value of our Company and provide long-term returns to our stakeholders. To ensure the effectiveness of our ESG measures, our Directors are responsible for overseeing the formulation and reporting of our ESG strategies and determining the ESG-related risks.

For example, to address the environmental related concerns in our daily operation and ensure the health and safety of our employees as well as the property owners and residents of the projects under our management, we have formulated internal procedures regarding the identification, monitoring and evaluation of potential environmental concerns ranging from noises pollution and solid waste disposition to the storage and disposition of potential hazardous materials. Pursuant to our internal procedure, the operation management departments are required to prepare written reports, proposing measures to address identified environmental concerns and our Chief Operating Officer for each regional company would be responsible for authorizing and overseeing the implementation of such measures. We have worked in the following aspects to promote health, safety and environmental aspects of our operations: (i) to promote the reduction in emissions, solid wastes and consumption of water, paper, energy and other supplies; (ii) to organize training programs to all employees on environmental protection; (iii) to prioritize environment-friendly suppliers in the decision-making process for

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Since our inception, we have been dedicated to serving the communities where we operate, and have implemented the following measures to fulfill our social responsibilities.

• Poverty relief. We actively participate in various poverty relief measures in cooperation with local communities and local governments. For example, we actively participated in the “Tibetan Youngsters Hand-in-Hand Plan (藏區青苗牽手計劃)” organized by the China Property Management Association (中國物業管理協會), China Community Poverty Alleviation Alliance (中國社區扶貧聯盟) and other institutions in 2020.

• Community public welfare. We develop Yiying Qingteng Plan (一應青藤計劃) and Neighbors Heart to Heart (十家連心) to promote community welfare and cooperate with Volunteer China (志願中國) to establish volunteer stations in communities.

• Combat of the COVID-19 pandemic. Since the outbreak of the COVID-19 pandemic, we have been on the frontline of preventing the spread of the pandemic, with our employees working around the clock across China to safeguard the health and safety of property owners and residents. We closely verify the identities and monitor the health status of every person entering properties under our management, remind residents of wearing masks, and offer comprehensive community living services to residents under quarantine. The salary and social welfare of our employees has not been affected and overtime wages have been paid in time during pandemic.

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INSURANCE

We believe that our insurance coverage is in line with the industry practice in the PRC and basically covers our current operation. We maintain insurance policies against major risks and liabilities arising from our business operations, primarily including (i) liability insurance to cover liabilities for property damages or personal injuries suffered by third parties arising out of or related to our business operations; and (ii) property insurance for damages to both movable and immovable properties owned by us or in our custody.

We are covered by property and liability insurance policies with coverage features that we believe are customary for similar companies in the PRC. However, our insurance coverage may not adequately protect us against certain operating risks and other hazards, which may result in adverse effects on our business. As of the Latest Practicable Date, we did not have any material outstanding insurance claims in relation to our business. See “Risk Factors—Risks Relating to Our Business and Industry—Our insurance may not sufficiently cover, or may not cover at all, losses and liabilities we may encounter during the ordinary course of operation” for more details.

EMPLOYEES

We believe that our quality personnel is our key to success and future development. We place strong emphasis on recruiting and training quality personnel. We recruit talent from various sources, such as employee referral, on-line job posting and working with professional recruiters, and provide on-going training and promotion opportunities to our staff members.

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As of March 31, 2021, we had a total of 12,562 full time employees in the PRC. The following table sets forth a breakdown of our employees by function as of March 31, 2021:

Number of % of our total Function employees employees

Headquarters 81 0.6% Finance 480 3.8% Human resources 74 0.6% Administration 54 0.4% Marketing 246 2.0% Project management 11,627 92.6%

Total 12,562 100.0%

The following table sets forth a breakdown of our employees by geographic location as of March 31, 2021:

Number of % of our total Geographic location employees employees

East China Region 2,404 19.15% South China Region 2,685 21.37% West China Region 1,720 13.69% North China Region 2,072 16.49% Central China Region 2,157 17.17% Bohai Region 1,524 12.13%

Total 12,562 100.0%

As of the Latest Practicable Date, some of our employees had formed a labor union. During the Track Record Period and up to the Latest Practicable Date, we did not experience any significant difficulties in recruiting suitable employees for our business operations. Neither did we have any material disputes with our employees, or experience any strike, labor disputes or industrial actions that may have a material adverse effect on our business, financial position and results of operations.

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Recruiting

We rely on high quality personnel for our consistent delivery of high quality service. We endeavor to hire the best talented employees in the market by offering competitive wages, bonus, benefits, systematic training opportunities and internal upward mobility. We recruit talented employees in accordance with the basic requirement of the position and principles of the overall evaluation and merit-based selection. During our recruiting process, we seek talent that is best suited to our vacancy by sourcing through a broad range of channels, including employee referral, on-line job posting and working with professional recruiters.

Training

We provide various systematic and extensive training programs to our employees. Our employee training programs primarily cover key areas in our business operations, which provide continuous training to our existing employees at different levels to specialize and strengthen their skill sets. The training programs are primarily classified into the following categories:

• Training System Construction: We design talent development plans through the combination of talent selection, training, employment and retention. Such talent training system covers self-learning, group training, practice learning and performance promotion activity.

• Curriculum and Project Development: By combining the management system with the talent standard, we develop training curriculums and projects to improve training system and foster strategic thinking of our employees.

• Mentor Management: We construct and manage internal mentor teams, integrate talent training into daily operation and management and build a “learning organization”. We also cooperate with universities, enterprises and reputational teachers to supplement our internal talent training.

• Routine Training: All employees are encouraged to undergo continuing skills training. We prepare annual and monthly plan for internal employee trainings. We provide them with trainings tailored to the needs of their positions and prepare training materials catering towards different job specification. The routine trainings are expected to be organized internally.

• Yiying Qingteng School (一應青藤學院): It is an online learning platform in which our employees are able to gain exposure to training curriculums covering, among others, the daily operation and management of property management services, marketing skills, financial management and leadership development. Through detailed coaching and training, we aim to improve the overall skills level of all our team members and better assist us to achieve our goals for business development and service provision.

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• Knowledge Management: We collect and share cases of outstanding individuals and teams in order to inspire our employees. These cases provide great examples for management system optimization and management process upgrade.

• Skill Competition: We regularly organize nationwide industry skill competitions to discover and incubate more talents.

We also formulate a comprehensive training plan to cover different levels of employees in 2021. For example, Wing-spread Learning Program (展翅學習項目)is designed for city general managers to focus on leadership skill. We also provide butler series training (管家培訓) for project management employees.

OUR BANK ACCOUNT AND CASH MANAGEMENT POLICY

We have a bank account and cash management system to manage the cash inflows and outflows of our branches in their ordinary course of business in accordance with PRC laws and regulations. We have established a cash management policy to monitor the work process of our branches, including but not limited to, requiring the approval of opening bank account and cash payments from our headquarters, setting the upper cash limit on hand for our branches, setting deadlines for depositing their cash received in the bank accounts, taking stock of the bank accounts and checking the cash balances as well as reconciliation the amounts monthly to lower the risks associated with cash management. We have detailed cash management policy to regulate our cash management and bank deposits management to ensure security and the reasonable use of our cash. Our employees are expressly forbidden from removing and/or using our cash for private or other purposes not in line with our ordinary course of business. Details of our cash management policy are set out as follows:

Cash handling policies and Cash flow transactions internal control measures

Opening of and managing bank Our subsidiaries and branch offices must accounts of our subsidiaries adhere to our internal policies and and branch offices procedures in relation to the opening of bank accounts. They are typically required to complete an application form before opening any bank accounts. Our subsidiaries and branch offices are typically required to reconcile and check bank balances on a monthly basis.

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Cash handling policies and Cash flow transactions internal control measures

Cash inflows in relation to We have cashiers or customer service payments of property personnel specifically responsible for cash management fees, rent or collection. They will verify that the cash other service fees from our collected is the correct amount prior to customers issuing receipts. We require that all cash collected and deposited into bank accounts within three days.

Payments made to our Such payments shall be submitted by suppliers, service providers responsible personnel in writing and must and subcontractors of our be pre-approved by the responsible subsidiaries and branches supervising personnel at a higher level. Once approved, such payments must be made directly from the bank accounts of our subsidiaries and branches.

Cash transfers to our We receive cash through methods such as centralized bank account or cheques, credit or debit card payments or the bank accounts of our bank transfers. Our employees are required subsidiaries and branches to timely file all proofs of payment.

Cash inventory and deposits Our subsidiaries and branch offices are typically not allowed to keep more than RMB2,000 in cash on hand. We typically require that excess amounts be deposited into the bank accounts of our subsidiaries and branch offices within the same day they are received.

INTERNAL CONTROL AND RISK MANAGEMENT

We are exposed to various risks during our operations. We have implemented various risk management policies and measures to identify, assess, manage and monitor risks arising from our operations. Details on risk categories identified by our management, internal and external reporting mechanism, remedial measures and contingency management have been codified in our policies. For details of the major risks identified by our management, see “Risk Factors—Risks Relating to Our Business and Industry” in this document.

In addition, we face various financial risks, including but not limited to interest rate risk, credit risk and liquidity risk. See “Financial Information—Market Risks” in this document for further discussion.

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To monitor the ongoing implementation of our risk management policies and corporate governance measures after the [REDACTED], we have adopted or will adopt, among others, the following risk management and internal control measures:

• the establishment of an audit committee responsible for overseeing our financial records, internal control procedures and risk management systems. See “Directors, Supervisors and Senior Management—Board Committees—Audit Committee” for the qualifications and experience of these committee members as well as a detailed description of the responsibility of our audit committee;

• the appointment of Mr. Fan Zhiwei (范治威) as our chief financial officer and Mr. Fan Zhiwei and Ms. Chan Yin Wah as our joint company secretaries to ensure the compliance of our operation with relevant laws and regulations. For their biographical details, see “Directors, Supervisors and Senior Management”;

• the appointment of Maxa Capital Limited as our compliance advisor upon the [REDACTED] to advise us on compliance with the Listing Rules; and

• the engagement of external legal advisors to advise us on compliance with the Listing Rules and to ensure our compliance with relevant regulatory requirements and applicable laws, where necessary.

In connection with the [REDACTED], we engaged an independent internal control consultant to review our internal controls and to provide us with relevant recommendations associated with their findings, based on an agreed scope covering controls and procedures in the following aspects: our services, risk assessment system, environmental control, management structure, communication and supervision system, regulatory compliance, financial reporting and accounting procedures, management of suppliers and procurement, cash and treasury management, human resources and salary management, tax payments, informational technology systems, insurance, fixed assets, application of licenses and permission and other general control measures. Accordingly, we have implemented rectification and improvement measures to respond to the findings and recommendations and adopted policies including Internal Control Handout《內控手 ( 冊》), Employee Training Management Procedure《員工培訓管理程式》 ( ), and Employee Salary Management Requirement《員工薪酬管理要求》 ( ). Our Directors are of the view that our internal control measure are adequate and effective for our current business environment.

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PROPERTIES

Owned Properties

As of the Latest Practicable Date, we owned 570 retail units with an aggregated GFA of 25,219 sq.m. and 339 car parks with an aggregate GFA of 11,749 sq.m. in the PRC. Among our 570 retail units, we had obtained real estate title certificates for 569 retail units. We had completed the registration for real estate title but had not obtained the real estate title certificate for one unit.

Among our 339 car parks, we completed the real estate title registration but had not obtained the real estate title certificates for 69 car parks. As advised by our PRC Legal Advisor, there is no material legal impediment for our obtaining the real estate title certificates. We had not obtained the real estate title certificates for 270 car parks. Foshan Chengjiruishang, a wholly-owned subsidiary of ours, was the investor and developer of such car parks and obtained relevant construction permits, therefore, as advised by our PRC Legal Advisor, Foshan Chengjiruishang has the right of earning income and is entitled to occupy and use such air defense car parking spaces and transfer the right of earning income of such car parks.

For further details with respect to our property interests, please refer to the valuation report as set out in Appendix III “Property Valuation Report” to this document.

Leased Properties

As of the Latest Practicable Date, we also leased 67 properties in various locations with an aggregated GFA of approximately 18,273 sq.m. for use as offices, staff accommodation and canteens.

As of the Latest Practicable Date, we had not registered 66 lease agreements of our leased properties, which are used as office and staff accommodation with a total GFA of approximately 13,537 sq.m., with the local housing administration authority as required under PRC law, primarily due to the lack of cooperation from the landlord in providing title certificate and proof of ownership and registering the lease agreement, which were beyond our control. According to the relevant PRC laws and regulations, we might be ordered to rectify this failure to register by competent authority and if we fail to rectify within a prescribed period, a penalty of RMB1,000 to RMB10,000 may be imposed on us as a result. In the event that we are required to relocate from such leased property, given the nature of our operation, we believe that it would not be difficult for us to identify and relocate to an alternative premises and relocation would not result in any material disruptions to our business. Although we may incur additional relocation costs, our Directors are of the view that this would not have any material impact on our business, financial position and results of operations. As of the Latest Practicable Date, we had not received any notice from any regulatory authority with respect to potential administrative penalties or enforcement actions as a result of our failure to register the lease agreement described above.

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CERTIFICATES, LICENSES AND PERMITS

We are required to obtain and maintain various certificates, licenses and permits in relations to our operations. See “Regulatory Overview” for more information about the material certificates, permits and licenses required for our business operations in the PRC. As advised by our PRC Legal Advisor, our Directors confirm that, as of the Latest Practicable Date, we had obtained all material licenses, permits, certificates and approvals from relevant authorities for our operations in the PRC. We are required to renew such licenses, permits and certificates from time to time. We do not expect any difficulties in obtaining such renewals as long as we meet the applicable requirements and conditions set by relevant laws and regulations.

LEGAL PROCEEDINGS AND COMPLIANCE

Legal Proceedings

We may be involved in legal proceedings or disputes in the ordinary course of business from time to time, such as contract disputes with our customers, subcontractors, suppliers and other parties. As of the Latest Practicable Date, we were involved as a defendant in the following material legal proceeding.

Ongoing Litigation

On March 4, 2018, the property owners’ association (the “Plaintiffs”) of a residential property under our management from November 2009 to January 2017 brought an action against us and two former chairmen of the property owners’ association in People’s Court of Futian District Court (深圳市福田區人民法院), requesting that we (i) settle outstanding contribution to the residential property’s special maintenance fund of RMB8.5 million and relevant interests of RMB2.0 million; (ii) refund car parks management fees of RMB11.5 million; (iii) reimburse the property owners’ association for expenses made out of property management fees of RMB2.0 million and relevant interests of RMB0.2 million; (iv) reimburse the property owners’ association for the expenses listed in the Plaintiffs’ auditor’s report in 2015 that were not supported by detailed statements of RMB1.6 million and relevant interests of RMB0.3 million; (v) refund the property management fee surplus of RMB0.3 million and relevant interest of RMB28,140.6; (vi) refund the labor costs deemed as unauthenticated by the Plaintiffs’ 2017 auditor’s report of RMB3.2 million; (vii) refund the inflated salary payment to property manager of RMB2.1 million and relevant interest of RMB0.3 million; (viii) bear the litigation costs incurred in the lawsuit and (ix) turn over the relevant management and financial records and documents from 2009 to 2017.

Futian District Court issued its judgement on December 24, 2019 and dismissed all claims made by the Plaintiffs. The Plaintiffs later appealed the decision to the Intermediate People’s Court of Shenzhen (深圳市中級人民法院). On February 23, 2021, the Intermediate People’s Court of Shenzhen vacated the original judgement and remanded the case to Futian District Court for retrial. As of the date of this document, this lawsuit remains pending.

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After due investigation and review of our internal records, to the best knowledge of our Directors, (i) we made due contribution to the special maintenance fund and utilized the fund for designated purposes during our management of the property; (ii) we contracted with the property developer, not the property owners’ association, for our car parks management services; (iii) there was no management fee surplus generated from this project during the time of our management; (iv) the relevant labor costs were authentic and, in accordance with relevant provisions in our property management service agreements, should be borne by the property owner's association; and (v) we did not make salary payments to the project manager out of property management fees generated from this project. In light of the foregoing, our Directors are of the view that it is unlikely that this lawsuit would have a material adverse impact on our business, financial conditions and results of operations. Accordingly, no provision has been made in our financial statements.

Historical Non-compliance Incident

As advised by our PRC Legal Advisor, we had not been subject to significant fines or legal actions involving non-compliances with any PRC laws or regulations relating to our business which would have a material adverse effect on our business during the Track Record Period and up to the Latest Practicable Date. Below summary sets out incident of historical non-compliance with applicable regulations during the Track Record Period and up to the Latest Practicable Date. Our Directors are of the view that below non-compliance incident will not have any material operational or financial impact on us.

Background for Non-compliance incident

During the Track Record Period, our Company and some of our PRC subsidiaries and branches failed to register for and/or make full contribution to the social insurance and housing provident funds for some of our employees as required under PRC law.

Reasons for the Non-compliance

This non-compliance incident was primarily because (i) some of our employees, especially our on-site personnel providing services such as repair and maintenance services who typically demonstrate high mobility, prefer not to contribute to social insurance and housing provident funds; and (ii) some of our employees requested us not to pay social insurance and housing provident funds for them as they purchased new rural medical and social insurance at their registered places of residence.

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Legal Consequences and Potential Maximum Penalties

According to the relevant PRC laws and regulations, if we fail to pay the full amount of social insurance contributions as required, (i) the relevant PRC authorities may demand us to pay the outstanding social insurance contributions within a stipulated time period and we may be subject to a late payment fee equal to 0.05% of the outstanding amount for each day of delay; if we fail to make such payments, we may be subject to a fine of one to three times to the amount of the outstanding contributions; and (ii) in respect of outstanding housing provident fund contributions, we may be ordered to pay the outstanding housing provident fund contributions within a prescribed time period. If the payment is not made within such time period, an application may be made to PRC courts for compulsory enforcement. In addition, we will be fined RMB10,000 to RMB50,000 for failing to make the housing provident fund registration within the prescribed time period.

Our Directors believe that such non-compliance would not have any material and adverse effect on our business and results of operations, considering that: (i) during the Track Record Period and up to the Latest Practicable Date, we had not received any notifications from the relevant PRC authorities requiring us to pay material shortfalls or the penalties with respect to social insurance and housing provident funds; (ii) we have not been subject to any administrative penalties during the Track Record Period and up to the Latest Practicable Date; (iii) we were not aware of any material employee complaints nor were involved in any material labor disputes with our employees with respect to social insurance and housing provident funds during the Track Record Period and up to the Latest Practicable Date; (iv) we have made provisions for our shortfall of contribution to social insurance and housing provident funds in the amount of RMB0.9 million, RMB2.0 million, RMB2.3 million, and RMB0.7 million, respectively, in our financial statements in 2018, 2019 and 2020 and the three months ended March 2021; (v) our Company and a vast majority of our PRC subsidiaries and branches have obtained written or oral confirmations from competent local government authorities which confirmed that no penalties had been imposed on us with respect to social insurance and housing provident funds during the Track Record Period; and (vi) we will make full contributions or pay any shortfall within a prescribed time period if demanded by the relevant government authorities.

Based on the foregoing, our PRC Legal Advisor is of the view that under the current relevant PRC laws and regulations, without material employee complaints or significant shift in relevant regulations or policies, the risk that we would be subject to material administrative penalties by relevant government authorities for failure to make full contributions to the social insurance and housing provident funds for our employees is remote.

Remedies and Rectification Measures Taken and Internal Control Measures Adopted

We have implemented relevant internal control measures to strengthen our oversight and management in relation to the social insurance and housing provident funds, including reviewing the calculation result of social insurance and housing provident funds for all eligible employees and actively communicate with local human resources, social security bureau and housing fund management center on a regular basis, to ensure we acquire the most updated information about the relevant laws and regulations. Based on the above, our Directors are of the view that we have implemented adequate and effective enhanced internal control measures internally.

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OVERVIEW

Immediately upon completion of the [REDACTED] without taking into account any Shares which may be issued pursuant to the exercise of the [REDACTED], our Ultimate Controlling Shareholders, namely Mr. Chen Yaozhong, Mr. Liang Zhijun, Mr. Lv Yuhua and Mr. Ma Xingwen, by virtue of the Acting in Concert Arrangement, will control in total approximately [REDACTED]% of the total share capital of our Company through the limited partnerships where they act as the general partners. Accordingly, Mr. Chen Yaozhong, Mr. Liang Zhijun, Mr. Lv Yuhua and Mr. Ma Xingwen together with the Employee Stock Ownership Platforms controlled by them, will be a group of Controlling Shareholders upon the [REDACTED].

ACTING IN CONCERT ARRANGEMENT

On March 15, 2021, our Ultimate Controlling Shareholders executed the Acting in Concert Agreement, pursuant to which our Ultimate Controlling Shareholders had agreed and confirmed, among other things, from March 2016 (which was the time when they became the beneficial owners of our Company) by acting as the general partners or limited partners, as the case may be, in Xicheng Ruijia, Xicheng Ruihe, Xicheng Ruifeng, Xicheng Ruiying and any other future entities controlled by our Ultimate Controlling ShareholdersNote: (a) they had been and would continue to be parties acting in concert and they had agreed to consult with each other and reach a unanimous consensus among themselves before the decision, implementation and agreement on all material management affairs, votings and/or commercial decisions, including but not limited to financial and operational matters, of any member of our Group; (b) they had casted and would continue to cast their votes as directors and/or shareholders (as appropriate) unanimously for or against all resolutions in all board and shareholders’ meetings and discussions of any member of our Group; and (c) they had cooperated and would continue to cooperate with one another to acquire, maintain and consolidate the control and management of our Group.

Note: On April 20, 2021, Xicheng Rui'an was established for the purpose of implementing the share incentive scheme. See “History—Reorganization—Adoption of Employee Stock Ownership Plan 2021” for more details. As Xicheng Rui’an is controlled by Mr. Chen Yaozhong (acting as the general partner), Xicheng Rui’an is also subject to the terms as contemplated under the Acting in Concert Arrangement.

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DELINEATION OF BUSINESS

Business of our Group

Our Group is principally engaged in property management services, value-added services to property developers, community value-added services and professional services. Please see “Business” in this document for further information of our business and operations.

Other Businesses Invested by our Ultimate Controlling Shareholders

Other than our Group, our Ultimate Controlling Shareholders hold in total less than 30% of equity interests in Shenzhen Jiaye Investment. Shenzhen Jiaye Investment has investment in elderly care business and property investments. Given the differences in the nature of such other businesses invested by our Ultimate Controlling Shareholders and the business of our Group, our Directors are of the view that there is a clear business delineation, and hence there is unlikely to be any direct or indirect competition with the business of our Group.

To ensure that competition will not exist in the future, our Ultimate Controlling Shareholders [have] entered into the Deed of Non-Competition in favor of our Company to the effect that they will not, and will procure their respective close associates not to, directly or indirectly participate in, or hold any right or interest, or otherwise be involved in or interested in any business which may be in competition with our Group’s business. See “—Deed of Non-Competition.”

As of the Latest Practicable Date, none of our Controlling Shareholders, our Directors and their respective close associates had any interest in any business which competes or is likely to compete, either directly or indirectly with our Company’s business which would require disclosure under Rule 8.10 of the Listing Rules.

INDEPENDENCE FROM OUR CONTROLLING SHAREHOLDERS

We believe that we are capable of carrying on our business independently of our Controlling Shareholders and their respective close associates (other than our Group) after the [REDACTED] for the following reasons:

Management Independence

Our Board comprises four executive Directors, two non-executive Directors and three independent non-executive Directors. As of the Latest Practicable Date, save for three of our executive Directors (namely Mr. Chen Yaozhong, Mr. Liang Zhijun and Mr. Lv Yuhua) and one non-executive Director (Mr. Ma Xingwen) who act as the general partners in Employee Stock Ownership Platforms, none of our Directors or the members of our senior management team held any management position at our Controlling Shareholders or their respective close associates.

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Each of the Directors is aware of his/her fiduciary duties as a Director, which require, among other things, that he/she acts for the benefit and in the best interests of our Company and does not allow any conflict between his/her duties as a Director and his/her personal interests. In the event that there is an actual or potential conflict of interest arising out of any transaction to be entered into between our Group and any of the Directors or their respective close associates, the interested Director(s) shall abstain from voting at the relevant board meetings of our Company in respect of such transactions and shall not be counted in the quorum.

Based on the above, our Directors are of the view that our Group is capable of managing our business independently from our Controlling Shareholders and their respective close associates following the completion of the [REDACTED].

Operational Independence

Although our Controlling Shareholders will retain a controlling interest in our Company after the [REDACTED], we have full rights to make all decisions on, and to carry out, our own business operations independently of our Controlling Shareholders and their respective close associates.

We hold and enjoy the benefit of all relevant licenses and permits material to the operation of our business. We have independent access to suppliers and customers, as well as an independent management team to handle our day-to-day operations. All of the properties and facilities necessary for our business operations are independent from our Controlling Shareholders and their respective close associates.

Financial Independence

There were no loans, advances and balances due to or from our Controlling Shareholders and their respective close associates which arose out of the ordinary course of business and there were no share pledges and guarantees provided by or to the Controlling Shareholders or their close associates on the borrowings of our Group as of the Latest Practicable Date.

In addition, we have our own internal control and accounting systems, accounting and finance department, independent treasury function for cash receipts and payment and independent access to third party financing. Accordingly, our Directors are of the view that our Group is capable of maintaining financial independence from our Controlling Shareholders and their respective close associates.

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DEED OF NON-COMPETITION

Each of our Ultimate Controlling Shareholders [has entered] into a Deed of Non-Competition in favor of our Company, pursuant to which each of our Ultimate Controlling Shareholders has irrevocably and unconditionally undertaken to our Company that he/she will not, and will procure his close associates not to directly or indirectly be involved in, conduct or undertake any business that directly or indirectly competes, or may compete, with the business engaged by our Group from time to time (the “Restricted Businesses”), or hold shares or interest (whether directly or indirectly) in any company or business (other than the shares or interest in our Group) that competes or may compete directly or indirectly with the Restricted Businesses, except where our Ultimate Controlling Shareholders and their respective close associates hold or are interested in (whether directly or indirectly) less than 30% of the total interest in any company which is engaged in any business that is or may be in competition with any business engaged by any member of our Group and they do not control the composition of a majority of the board of such company.

Further, each of our Ultimate Controlling Shareholders has undertaken that if any new business investment/other business opportunity relating to the Restricted Businesses (the “Competing Business Opportunity”) is identified by/made available to him or any of his close associates, he/she shall, and shall procure that his close associates shall, refer such Competing Business Opportunity to our Company on a timely basis by giving written notice (the “Offer Notice”) within 30 business days of identifying the target company (if relevant), the nature of the Competing Business Opportunity, the investment or acquisition costs and all other details reasonably necessary for our Company to consider whether to pursue such Competing Business Opportunity.

Upon receiving the Offer Notice, our Company shall seek approval from a board committee who do not have an interest in the Competing Business Opportunity (the “Independent Board”) as to whether to pursue or decline the Competing Business Opportunity (any Director who has actual or potential interest in the Competing Business Opportunity shall abstain from attending (unless their attendance is specifically requested by the Independent Board) and voting at, and shall not be counted in the quorum for, any meeting convened to consider such Competing Business Opportunity). The Independent Board shall consider, among others, the financial impact of pursuing the Competing Business Opportunity offered, whether the nature of the Competing Business Opportunity is consistent with our Group’s strategies and development plans and the general market conditions of our business. If appropriate, the Independent Board may appoint independent financial advisors and legal advisors to assist in the decision making process in relation to such Competing Business Opportunity. The Independent Board shall, within 30 business days of receipt of the written notice referred above, inform our Ultimate Controlling Shareholders in writing on behalf of our Company its decision as to whether the Company is to pursue or decline the Competing Business Opportunity.

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The relevant Ultimate Controlling Shareholder shall be entitled but not obliged to pursue such Competing Business Opportunity if he/she has received a notice from the Independent Board declining such Competing Business Opportunity or if the Independent Board failed to respond within such 30 business days’ period mentioned above. If there is any material change in the nature, terms or conditions of such Competing Business Opportunity pursued by the relevant Ultimate Controlling Shareholder, he/she shall refer such revised Competing Business Opportunity to our Company as if it were a new Competing Business Opportunity.

The Deed of Non-Competition will lapse automatically if our Ultimate Controlling Shareholders and their respective close associates cease to hold or cease to be interested in, whether directly or indirectly, 30% or above of our Shares with voting rights or our Shares cease to be [REDACTED] on the Stock Exchange.

Each of our Ultimate Controlling Shareholders has further undertaken to us that he will provide and procure his close associates to provide on best endeavor basis, all information necessary for the annual review by our independent non-executive Directors for the enforcement of the Deed of Non-Competition. They will make an annual declaration in our annual report on the compliance with the Deed of Non-Competition in accordance with the principle of voluntary disclosure in the corporate governance report.

In order to promote good corporate governance practices and to improve transparency, the Deed of Non-Competition includes the following provisions:

• our independent non-executive Directors shall review, at least on an annual basis, the compliance with the Deed of Non-Competition by our Ultimate Controlling Shareholders;

• we will disclose the decisions on matters reviewed by the independent non-executive Directors (including the reasons for not taking up the Competing Business Opportunity referred to our Company) and the review by our independent non-executive Directors on the compliance with, and the enforcement of, the Deed of Non-Competition in our annual report or by way of announcement to the public in compliance with the requirements of the Listing Rules; and

• in the event that any of our Directors and/or their respective close associates has material interests in any matter to be deliberated by our Board in relation to the compliance and enforcement of Deed of Non-Competition, he/she may not vote on the resolutions of our Board approving the matter and shall not be counted towards the quorum for the voting pursuant to the applicable provisions in the Articles of Association.

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CORPORATE GOVERNANCE MEASURES

Each of our Ultimate Controlling Shareholders and his respective associates may not compete with us as provided in the Deed of Non-Competition. Each of our Controlling Shareholders has confirmed that he/it fully comprehends his/its obligations to act in our Shareholders’ best interests as a whole. Our Directors believe that there are adequate corporate governance measures in place to manage existing and potential conflicts of interest. In order to further avoid potential conflicts of interest, we have implemented the following measures:

(a) as part of our preparation for the [REDACTED], we have amended our Articles of Association to comply with the Listing Rules. In particular, our Articles of Association provided that, unless otherwise provided, a Director shall not vote on any resolution approving any contract or arrangement or any other proposal in which such Director or any of his associates have a material interest nor shall such Director be counted in the quorum present at the meeting;

(b) a Director with material interests shall make full disclosure in respect of matters that may have conflict or potentially conflict with any of our interest and abstain from the board meetings on matters in which such Director or his associates have a material interest, unless the attendance or participation of such Director at such meeting of the Board is specifically requested by a majority of the independent non-executive Directors;

(c) we are committed that our Board should include a balanced composition of executive Directors and independent non-executive Directors. We have appointed three independent non-executive Directors and we believe our independent non-executive Directors possess sufficient experience and they are free of any business or other relationship which could interfere in any material manner with the exercise of their independent judgment and will be able to provide an impartial, external opinion to protect the interests of our public Shareholders. Details of our independent non-executive Directors are set out in “Directors, Supervisors and Senior Management—Board of Directors—Independent non-executive Directors”;

(d) we have appointed Maxa Capital Limited as our compliance advisor, which will provide advice and guidance to us in respect of compliance with the applicable laws and the Listing Rules including various requirements relating to Directors’ duties and corporate governance;

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(e) as required by the Listing Rules, our independent non-executive Directors shall review any connected transactions annually and confirm in our annual report that such transactions have been entered into in our ordinary and usual course of business, are either on normal commercial terms or on terms no less favorable to us than those available to or from Independent Third Parties and on terms that are fair and reasonable and in the interests of our Shareholders as a whole; and

(f) on an annual basis, our independent non-executive Directors will review the non-competing undertakings provided by our Controlling Shareholders and their compliance with such undertakings.

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Our Group has entered into a number of agreements with parties who will, upon completion of the [REDACTED], become our connected persons, and the transactions disclosed in this section will constitute continuing connected transactions for our Company under the Listing Rules upon the [REDACTED].

CONTINUING CONNECTED TRANSACTIONS FULLY EXEMPT FROM THE REPORTING, ANNUAL REVIEW, ANNOUNCEMENT AND INDEPENDENT SHAREHOLDERS’ APPROVAL REQUIREMENTS

Master Property Management Services Agreement

On [●], our Company entered into a master property management agreement (the “Master Property Management Services Agreement”) with Dongguan Guanshen Changcheng Property Co., Ltd. (東莞市莞深長城地產有限公司)(“Dongguan Guanshen”), a wholly-owned subsidiary of Centralcon Holding, pursuant to which we agreed to provide property management services to Dongguan Guanshen for residential properties it owned and located in the community we manage, including but not limited to cleaning, security, gardening and repair and maintenance services (the “Property Management Services”). The Master Property Management Services Agreement has a term commencing from the [REDACTED] to December 31, 2023.

We started to provide Property Management Services to Dongguan Guanshen and received management fees in 2019. For each of the two years ended December 31, 2019 and 2020 and the three months ended March 31, 2021, the total service fee payable to our Group in respect of the Property Management Services amounted to approximately RMB0.5 million, RMB0.5 million and RMB0.1 million, respectively.

The fees to be charged for the Property Management Services will be determined with reference to the prices charged by us for providing comparable services to Independent Third Parties. The residential property management fees shall not be higher than the standard fees designated by the relevant regulatory authorities or lower than the standard fees to be charged from Independent Third Parties.

It is estimated that the maximum amounts of service fee payable by Dongguan Guanshen in relation to the Property Management Services for each of the three years ending December 31, 2023 will not exceed RMB0.5 million, RMB0.5 million and RMB0.5 million, respectively, which will be subject to the termination provision of the Master Property Management Services Agreement. In arriving at the above annual caps for the Property Management Services, our Directors have considered the existing signed contract and the historical transaction amounts during the Track Record Period.

Dongguan Guanshen is a fellow subsidiary of Centralcon Capital, our substantial shareholder, and therefore a connected person of our Company for the purpose of the Listing Rules. Accordingly, the transactions under the Master Property Management Services Agreement will constitute continuing connected transactions for our Company under Chapter 14A of the Listing Rules upon [REDACTED].

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Since each of the applicable percentage ratios under the Listing Rules in respect of the annual caps under the Master Property Management Services Agreement is expected to be less than 5% and the total consideration will be less than HKD3,000,000 on an annual basis, the transactions under the Master Property Management Services Agreement constitute continuing connected transactions for our Company which will be within the de minimis threshold provided under Rule 14A.76 of the Listing Rules and will be exempt from the reporting, annual review, announcement and independent Shareholders’ approval requirements under Chapter 14A of the Listing Rules.

Repair and Maintenance Services Agreement

On January 1, 2021, Changcheng Louyu Technology Beijing Branch Office entered into a repair and maintenance services agreement (the “Repair and Maintenance Services Agreement”) with Baoshihua Property Management Co., Ltd. (寶石花物業管理有限公司) (“Baoshihua Property Management”), a non-wholly owned subsidiary of Country Garden Services, pursuant to which our Group agreed to provide to Baoshihua Property Management repair and maintenance services, including but not limited to inspection, repair and maintenance services for common area of a property managed by Baoshihua Property Management (the “Repair and Maintenance Services”). The Repair and Maintenance Services Agreement has a term commencing from January 1, 2021 to December 31, 2021.

We started to provide Repair and Maintenance Services to Baoshihua Property Management in January 2021. For the three months ended March 31, 2021, the total service fee payable to our Group in respect of the Repair and Maintenance Services amounted to approximately RMB0.2 million. The fees charged for the Repair and Maintenance Services are determined after arm’s length negotiations with reference to (i) the scope of services; (ii) the anticipated operation costs (including but not limited to labor costs, administration costs and costs of materials); and (iii) the prices charged by us for providing comparable services to Independent Third Parties.

It is estimated that the maximum amounts of the service fees payable by Baoshihua Property Management in relation to the Repair and Maintenance Services for the year ending December 31, 2021 will not exceed RMB0.9 million, as agreed and provided in the Repair and Maintenance Services Agreement.

Country Garden Services is our pre-[REDACTED] Investor and a substantial shareholder, Baoshihua Property Management is therefore a connected person of our Company for the purpose of the Listing Rules. Accordingly, the transactions under the Repair and Maintenance Services Agreement will constitute continuing connected transactions for our Company under Chapter 14A of the Listing Rules upon [REDACTED].

Since the annual caps under the Repair and Maintenance Services Agreement is expected to be less than 5% and the total consideration will be less than HKD3,000,000 on an annual basis, the transactions under the Repair and Maintenance Services Agreement constitute continuing connected transactions for our Company which will be within the de minimis threshold provided under Rule 14A.76 of the Listing Rules and will be exempt from the reporting, annual review, announcement and independent Shareholders’ approval requirements under Chapter 14A of the Listing Rules.

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So far as is known to our Directors, as of the Latest Practicable Date and immediately prior to and following the completion of the [REDACTED] and the Conversion of Domestic Shares into H Shares (assuming the [REDACTED] is not exercised), the following persons had and will have interests or short positions in our Shares or underlying Shares which would fall to be disclosed to us under the provisions of Divisions 2 and 3 of Part XV of the SFO, or who is, directly or indirectly, interested in 10% or more of the issued voting shares of any other member of our Group:

Shares held in the total share Shares held as of capital of the Company the Latest Practicable Date immediately following and immediately prior to the completion of Name of Shareholder Nature of interest Class of Shares the [REDACTED](1) the [REDACTED](1) Percentage Percentage Number (approx.) Number (approx.)

Xicheng Ruijia(2) Beneficial owner Domestic Shares(5) 57,997,391 66.50% [REDACTED] [REDACTED]% Shares (L) Shares (L)

Mr. Ma Xingwen(2) Interest in controlled Domestic Shares(5) 57,997,391 66.50% [REDACTED] [REDACTED]% corporations Shares (L) Shares (L)

Xicheng Ruihe(2) Beneficial owner Domestic Shares(5) 57,997,391 66.50% [REDACTED] [REDACTED]% Shares (L) Shares (L)

Xicheng Rui’an(2) Beneficial owner Domestic Shares(5) 57,997,391 66.50% [REDACTED] [REDACTED]% Shares (L) Shares (L)

Mr. Chen Yaozhong(2) Interest in controlled Domestic Shares(5) 57,997,391 66.50% [REDACTED] [REDACTED]% corporations Shares (L) Shares (L)

Xicheng Ruifeng(3) Beneficial owner Domestic Shares(5) 57,997,391 66.50% [REDACTED] [REDACTED]% Shares (L) Shares (L)

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Shares held in the total share capital of the Company immediately following Shares held as of the completion of the Latest Practicable Date the [REDACTED] and and immediately prior to Conversion of Domestic Name of Shareholder Nature of interest Class of Shares the [REDACTED](1) Shares into H Shares(1) Percentage Percentage Number (approx.) Number (approx.)

Mr. Liang Zhijun(2) Interest in controlled Domestic Shares(5) 57,997,391 66.50% [REDACTED] [REDACTED]% corporations Shares (L) Shares (L)

Xicheng Ruiying(2) Beneficial owner Domestic Shares(5) 57,997,391 66.50% [REDACTED] [REDACTED]% Shares (L) Shares (L)

Mr. Lv Yuhua(2) Interest in controlled Domestic Shares(5) 57,997,391 66.50% [REDACTED] [REDACTED]% corporations Shares (L) Shares (L)

Centralcon Capital(3) Beneficial owner Domestic Shares(5) 15,894,052 18.22% [REDACTED] [REDACTED]% Shares (L) Shares (L)

Centralcon Holding(3) Interest in controlled Domestic Shares(5) 15,894,052 18.22% [REDACTED] [REDACTED]% corporations Shares (L) Shares (L)

Shenzhen Centralcon Land Co., Ltd. Interest in controlled Domestic Shares(5) 15,894,052 18.22% [REDACTED] [REDACTED]% (深圳市中洲置地有限公司)(3) corporations Shares (L) Shares (L)

Mr. Huang Guangmiao (黄光苗)(3) Interest in controlled Domestic Shares(5) 15,894,052 18.22% [REDACTED] [REDACTED]% corporations Shares (L) Shares (L)

Country Garden Services(4) Beneficial owner Domestic Shares(5) 13,321,391 15.28% [REDACTED] [REDACTED]% Shares (L) Shares (L)

Foshan Country Garden Management Interest in controlled Domestic Shares(5) 13,321,391 15.28% [REDACTED] [REDACTED]% Services Co., Ltd. (佛山市碧桂園管理 corporations Shares (L) Shares (L) 服務有限公司)(4)

Foshan Country Garden Management Interest in controlled Domestic Shares(5) 13,321,391 15.28% [REDACTED] [REDACTED]% Consulting Co., Ltd. (佛山市碧桂園 corporations Shares (L) Shares (L) 管理顧問有限公司)(4)

Country Garden Services Holdings Interest in controlled Domestic Shares(5) 13,321,391 15.28% [REDACTED] [REDACTED]% Company Limited (碧桂園服務控股 corporations Shares (L) Shares (L) 有限公司)(4)

Concrete Win Limited(4) Interest in controlled Domestic Shares(5) 13,321,391 15.28% [REDACTED] [REDACTED]% corporations Shares (L) Shares (L)

Ms. Yang Huiyan (楊惠妍)(4) Interest in controlled Domestic Shares(5) 13,321,391 15.28% [REDACTED] [REDACTED]% corporations Shares (L) Shares (L)

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Notes:

(1) The letter “L” denotes the person’s long position in our Shares.

(2) As of the Latest Practicable Date, Xicheng Ruijia, a limited partnership established in the PRC, was owned as to 40.02% by its general partner, Mr. Ma Xingwen, our non-executive Director, and as to 59.98% by other individual limited partners (our existing employees and former employees).

As of the Latest Practicable Date, Xicheng Ruihe, a limited partnership established in the PRC, was owned as to 35.02% by its general partner, Mr. Chen Yaozhong, our executive Director, and as to 64.98% by other individual limited partners (our existing employees and former employees).

As of the Latest Practicable Date, Xicheng Rui’an, a limited partnership established in the PRC, was owned as to 11.52% by its general partner, Mr. Chen Yaozhong, our executive Director, and as to 88.48% by other individual limited partners (our existing employees).

As of the Latest Practicable Date, Xicheng Ruifeng, a limited partnership established in the PRC, was owned as to 16,00% by its general partner, Mr. Liang Zhijun, our executive Director, and as to 84.00% by other individual limited partners (our existing employees and former employees).

As of the Latest Practicable Date, Xicheng Ruiying, a limited partnership established in the PRC, was owned as to 20.90% by its general partner, Mr. Lv Yuhua, our executive Director, and as to 79.10% by other individual limited partners (our existing employees and former employees).

By virtue of the Acting in Concert Arrangement, immediately upon [REDACTED], Mr. Chen Yaozhong, Mr. Liang Zhijun, Mr. Lv Yuhua and Mr. Ma Xingwen (our Ultimate Controlling Shareholders) will control in total approximately 49.88% of the Shares through the Employee Stock Ownership Platforms where they act as the general partners. Accordingly, each of our Ultimate Controlling Shareholders has a deemed interest under the SFO in the Shares held by Employee Stock Ownership Platforms.

(3) As of the Latest Practicable Date, Centralcon Capital was wholly owned by Centralcon Holding. Centralcon Holding was in turned owned as to 52.62% by Shenzhen Centralcon Land Co., Ltd., which is controlled by Mr. Huang Guangmiao. By virtue of SFO, each of Centralcon Holding, Shenzhen Centralcon Land Co., Ltd. and Mr. Huang Guangmiao is deemed to be interested in the same number of Shares in which Centralcon Capital is interested in.

(4) As of the Latest Practicable Date, Country Garden Services was owned as to 50% by Foshan Country Garden Management Services Co., Ltd. and 50% by Foshan Country Garden Management Consulting Co., Ltd., both wholly owned by Country Garden Services Holdings Company Limited. Country Garden Services Holdings Company Limited was owned as to 41.25% by Concrete Win Limited, which was wholly owned by Ms. Yang Huiyan. By virtue of SFO, each of Foshan Country Garden Management Services Co., Ltd., Foshan Country Garden Management Consulting Co., Ltd., Concrete Win Limited and Ms. Yang Huiyan is deemed to be interested in the same number of Shares in which Country Garden Services is interested in.

(5) Upon completion of the [REDACTED] and the Conversion of Dometic Shares into H Shares, such Shares will be H Shares.

Except as disclosed above, our Directors are not aware of any person will, immediately prior to and following the completion of the [REDACTED] and the Conversion of Domestic Shares into H Shares (assuming the [REDACTED] is not exercised), had or will have interests or short positions in any Shares or underlying Shares, which would fall to be disclosed to us under the provisions of Divisions 2 and 3 of Part XV of the SFO, or who is, directly or indirectly interested in 10% or more of the issued voting shares of any other member of our Group. Our Directors are not aware of any arrangement which may at a subsequent date result in a change of control of our Company.

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The detailed information of our Directors, Supervisors and senior management are listed below. None of the following Directors, Supervisors or senior management has any relationship with any other Directors, Supervisors or senior management.

BOARD OF DIRECTORS

Our Board which is responsible for the management and conduct of our business consists of nine Directors including four executive Directors, two non-executive Directors and three independent non-executive Directors.

Date of Relationship Time of joining Position(s) in appointment with other Name Age our Group our Company as Director Key responsibilities Director(s)

Executive Directors Mr. Chen Yaozhong 58 July 1993 Chairman of the Board, December 10, Responsible for the N/A (陳耀忠) executive Director 1996 implementation of strategic and general manager planning and development plans and overall management of our Group

Mr. Liang Zhijun 47 July 1996 Executive Director and February 1, Responsible for operation N/A (梁志軍) deputy general 2005 management and quality manager control of our Group

Mr. Lv Yuhua 45 July 1998 Executive Director and January 1, 2012 Responsible for the investment N/A (呂雨華) deputy general management and marketing manager development of our Group

Mr. Yin Shanfeng 54 April 2016 Executive Director April 13, 2016 Risk management and internal N/A (尹善峰) control of our Group

Non-executive Directors Mr. Ma Xingwen 68 May 2011 Non-executive Director May 26, 2011 Responsible for the provision N/A (馬興文) of guidance for the overall development of our Group

Mr. Ning Zhu 42 July 2018 Non-executive Director July 28, 2018 Responsible for the provision N/A (寧柱) of guidance for the overall development of our Group

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Date of Relationship Time of joining Position(s) in appointment with other Name Age our Group our Company as Director Key responsibilities Director(s)

Independent Non-executive Directors Mr. Cao Yang 66 May 2021 Independent May 10, 2021 Responsible for providing N/A (曹陽) non-executive independent advice to our Director Board

Mr. Wu Yajun 53 December 2019 Independent December 25, Responsible for providing N/A (武亞軍) non-executive 2019 independent advice to our Director Board

Ms. Xin Zhu 52 May 2021 Independent May 10, 2021 Responsible for providing N/A (辛珠) non-executive independent advice to our Director Board

Executive Directors

Mr. Chen Yaozhong (陳耀忠), aged 58, was appointed as our Director on December 10, 1996 and the Chairman of the Board since January 28, 2013. On December 12, 1996, Mr. Chen was appointed as the general manager of our Company and since then, he has been mainly responsible for the implementation of strategic planning and development plans and overall management of our Group.

Mr. Chen joined our Group in July 1993, and successively served as a department manager and an assistant to the general manager of the Company until December 1996, during which he was primarily responsible for the management of elevator engineering department and assisting the general manager. Since December 1996 (other than the period from June 2019 to March 2020), Mr. Chen served as the general manager of the Company with its primary responsibility focusing on daily management and operation of our Company.

Prior to joining our Group, from August 1983 to September 1988, Mr. Chen served as an assistant engineer of Guangdong Hydropower Installation Company (廣東省水電安裝公司) in the PRC, a company principally engaged in the installment of hydroelectric devices. From November 1988 to March 1993, Mr. Chen served as an assistant engineer in Centralcon Holding, where he was primarily responsible for engineering matters.

Mr. Chen was accredited as the leading person in the property management industry in Guangdong for the years 2014 to 2016 (2014-2016年廣東省物業管理行業「領軍人物」)by Guangdong Property Management Industry Association (廣東物業管理行業協會), the outstanding promoter of the performance excellence model in Shenzhen (2016) (深圳市卓越績效模式優秀推進者（2016年）) by Shenzhen Performance Excellence Management Foundation (深圳市卓越績效管理促進會) and Shenzhen May 1st labor medal for 2019 (2019 年深圳市五一勞動獎章) by Shenzhen Federation of Trade Unions (深圳市總工會). In March 2019, Mr. Chen was also awarded for the excellent contribution in promoting the performance excellence model (推行卓越績效模式傑出貢獻獎) by Shenzhen Performance Excellence Management Foundation.

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Mr. Chen obtained his diploma in electrical machines in hydroelectric power stations from Guangdong Water Conservancy and Electric Power School (廣東省水利電力學校) (currently known as Guangdong Polytechnic of Water Resources and Electric Engineering (廣東水利電力職業技術學院)) in the PRC in July 1983, and his master’s degree in business administration through long distance learning courses from Centenary College in the United States of America in January 2011.

Mr. Liang Zhijun (梁志軍), aged 47, was appointed as our executive Director on February 1, 2005. He has been serving as a deputy general manager of the Company since August 2005 and primarily responsible for operation management and quality control of our Group.

Mr. Liang joined our Group as an assistant of community services in July 1996 and successively served for several positions relating to quality control until January 2004. Mr. Liang served as the manager of our Beijing branch from January 2004 to August 2005, and as a deputy general manager of the Company from August 2005 to October 2017, where he was primarily responsible for the management of operations, quality control and information technology. From October 2017 to March 2019, Mr. Liang concurrently served as a deputy general manager of the Company and the regional head of the Central China Region, where he was primarily responsible for business management and quality control of Central China Region. From June 2019 to March 2020, Mr. Liang served as the general manager of our Company and was responsible for the daily management of our Group.

In 2013, Mr. Liang was accredited as a certified property manager (註冊物業管理師) by the Ministry of Housing and Urban-Rural Development (住房和城鄉建設部) of the PRC, and served as a distinguished researcher of the Research and Development Center of China Property Management Institute (中國物業管理協會行業發展研究中心) for the periods of 2008-2011 and 2014-2017, respectively.

Mr. Liang obtained his bachelor’s degree in real estate operations and management from Harbin Architectural and Civil Engineering Institute (哈爾濱建築大學) (currently known as Harbin Institute of Technology (哈爾濱工業大學)) in the PRC in July 1996.

Mr. Lv Yuhua (呂雨華), aged 45, was appointed as our executive Director on January 1, 2012. He has also been serving as a deputy general manager of the Company since August 2007 and primarily responsible for the investment management and marketing development of our Group.

Mr. Lv joined our Group in July 1998 and served as the head of operation management department of the Company until March 2020, where he was primarily responsible for management of operational plans. From April 2000 to July 2007, Mr. Lv successively served as the secretary of the board of the Company and a manager of the asset management department of the Company, where he was primarily responsible for asset management and board matters. From July 2007 to October 2017, Mr. Lv concurrently served as a vice president of our Group, the general manager of Foshan Chengjiruishang, and the head of property operations center and the business division of life and services. Since October 2017, Mr. Lv has served as the regional head of the East China Region, where he was primarily responsible for the overall business operation of the East China Region.

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Mr. Lv obtained a qualification certificate of specialty and technology at an intermediate level in ecomomics – real estate from the Ministry of Personnel of the PRC (中華人民共和國人事部) (currently known as the Ministry of Human Resources and Social Security of the PRC (中華人民共和國人力資源和社會保障部)) in the PRC in November 2002.

Mr. Lv obtained his bachelor’s degree in real estate operations and management from Zhongnan University of Economics and Law (中南財經大學) in the PRC in June 1998 and his master’s degree in business administration from Tsinghua University (清華大學) in the PRC in July 2014.

Mr. Yin Shanfeng (尹善峰), aged 54, joined our Group and was appointed as our non-executive Director on April 13, 2016. On December 1, 2020, he was appointed as an executive Director. He is mainly responsible for the risk management and internal control of our Group.

From December 2004 to November 2020, Mr. Yin successively served as the financial controller, the secretary to the board and a vice-president in Centralcon Holding, where he was primarily responsible for the financial management, financing merger and acquisition and matters relating to corporate governance and information disclosure matters of a listed company.

Mr. Yin was accredited as an accountant by the Ministry of Finance in the PRC in May 1998 and a certified management accountant by the Institute of Management Accountants in the United States of America in February 2002.

Mr. Yin obtained his bachelor’s degree in management engineering and his master’s degree in economics from Xi’an Jiaotong University (西安交通大學) in the PRC in July 1988 and June 1991, respectively. In May 2002, he also obtained his master’s degree in business administration from the Roosevelt University in the United States of America.

Non-executive Directors

Mr. Ma Xingwen (馬興文), aged 68, joined our Group and was appointed as our non-executive Director on May 26, 2011. He is mainly responsible for the provision of guidance for the overall development of our Group, and has served as a Director of the Company since then.

From August 1984 to February 1993, Mr. Ma served at Centralcon Holding as an assistant engineer of the housing management department and the head of such department. From February 1993 to March 1996, he served as a manager of Changcheng Logistics, a company primarily engaged in providing warehouse and storage as well as logistics services, where he was primarily responsible for the overall management of the company. From March 1996 to March 2011, he successively served several positions at Centralcon Holding with his last position as the chairman of the board of directors of Centralcon Holding.

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Mr. Ma obtained his diploma in chemical machinery from Shenyang Chemical Technology College (瀋陽化工學院) in the PRC in November 1979.

Mr. Ning Zhu (寧柱), aged 42, joined our Group and was appointed as our non-executive Director on July 28, 2018. He is primarily responsible for the provision of guidance for the overall development of our Group.

From November 2009 to October 2012, he served as a president of the direct investment department at Shanghai Ruixing Investment Management Co., Ltd. (上海瑞幸投資管理有限公司), an asset management firm. Mr. Ning worked as management positions in several companies of oil and natural gas industry, including as a director at Plus Good Holdings Limited (啓正集團有限公司) from February 2010 to June 2013 (during which he was designated as the chief representative at group’s Beijing representative office from April 2010 to March 2011), as a director of administration department at Zhong Neng International Crude Oil Investment Group Limited (中能國際石油投資集團有限公司)from March 2010 to March 2011, as the chief executive officer of Beijing Sino-Science Huakang Energy Technology Co., Ltd. (北京中科華康能源科技有限公司) from June 2012 to May 2014, as a director at Hong Kong Sino-Science Energy Investment Company Limited (香港中科能源投資有限公司) from September 2014 to January 2016. From December 2013 to September 2015, he also served in Geo-Jade Petroleum Corporation (洲際油氣股份有限公司), a company listed at Shanghai Stock Exchange (stock code: 600759), with his last position serving as a president of the company. Since August 2016, Mr. Ning has been serving as a director and the president of Shanghai Qiansheng Investment Management Enterprise (Limited Partnership) (上海虔盛投資管理企業（有限合夥）), an equity investment firm, where he was primarily responsible for overall operation management.

In September 2010, Mr. Ning was accredited as CFA Charterholder by the Chartered Financial Analyst Institute in the United States of America.

Mr. Ning obtained both his bachelor’s and master’s degree in economics from Renmin University of China (中國人民大學) in the PRC in July 2001 and June 2004, respectively. He obtained his master of science in economics from Hong Kong University of Science and Technology in Hong Kong in November 2004. He also obtained his doctorate degree in finance from Graduate School of Chinese Academy of Social Sciences (中國社會科學院研究生院) in the PRC in June 2013 and executive master of business administration from Tsinghua University (清華大學) in the PRC in July 2018.

Independent Non-executive Directors

Mr. Cao Yang (曹陽), aged 66, was appointed as our independent non-executive Director when he joined our Group on May 10, 2021. He is mainly responsible for providing independent advice to our Board.

From February 2003 to February 2005, Mr. Cao concurrently served as a chief officer of teaching and research section at Shenzhen Real Estate Management and Research Center (深圳市房地產管理研究中心), where he was primarily responsible for teaching, research and educational administration management. From March 2004 to March 2008, Mr. Cao served as a director of Shenzhen Real Estate Management and Research Center. Since May 2005, he has served at several positions in Shenzhen Property Management Association (深圳市物業管理行業協會), with his current position as the president of the association, where he was primarily responsible for the overall management. Since

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October 2015, Mr. Cao has been serving as the general manager (dean) and an executive director of Shenzhen Zhongshennan Property Management Research Institute Co., Ltd. (深圳中深南方物業管理研究院有限公司), where he was primarily responsible for the daily operation and overall management.

Since January 2018, Mr. Cao has been serving as an independent director at EIT Environmental Development Group Co., Ltd. (玉禾田環境發展集團股份有限公司), a company primarily engaged in the operations of municipal sanitation, comprehensive property management, domestic waste disposal and the greening and maintenance of garden and listed on the SZSE (stock code: 300815). Since April 2019, Mr. Cao has also been serving as an independent director at Shenzhen SDG Service Co., Ltd. (深圳市特發服務股份有限公司), a company primarily engaged in providing property management services and listed on SZSE (stock code: 300917).

In September 1984, Mr. Cao obtained his diploma in nursing from the Affiliated School of Nursing in Xi’an Medical School (西安醫學院附設護士學校), currently known as the Xi’an Jiaotong University Health Science Center (西安交通大學醫學部) in the PRC. In December 1987, he obtained a diploma in a special training program for party and government cadres organized by Chinese Communist Party Shaanxi Provincial Party School (中共陝西省委黨校) in the PRC. In April 2018, Mr. Cao obtained the independent director qualification certificate (獨立董事資格證書) from the SZSE.

Mr. Wu Yajun (武亞軍), aged 53, was appointed as our independent non-executive Director when he joined our Group on December 25, 2019. He is mainly responsible for providing independent advice to our Board.

Since July 1994, Mr. Wu has served at several positions in Guanghua School of Management of Peking University (北京大學光華管理學院), where he was primarily responsible for university education and research. He was a tutor from July 1994 to July 1996, a lecturer from August 1996 to July 2002, and has been as an associate professor since August 2007 and a mentor to doctorate students since June 2009.

Since December 2017, Mr. Wu has been serving as an independent non-executive director at Jiangsu Fengye Technical Environment Group Co., Ltd (江蘇峰業科技環保集團股份有限公司), a company primarily engaged in design, construction and management of projects for environmental protection and energy saving.

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Mr. Wu was awarded the Environmental Award by the China Council for International Cooperation on Environment and Development (中國環境與發展國際合作委員會) in the PRC in October 2001.

Mr. Wu obtained his bachelor’s degree in engineering from Tsinghua University (清華大學) in the PRC in July 1991, his master’s degree in management from Peking University (北京大學) in the PRC in July 1994, and his doctorate degree in economics from Peking University (北京大學) in the PRC in July 1999.

Ms. Xin Zhu (辛珠), aged 52, was appointed as our independent non-executive Director when she joined our Group on May 10, 2021. She is mainly responsible for providing independent advice to our Board.

From December 2002 to December 2005, Ms. Xin worked at Guangdong Holdings Limited (廣東粵海控股集團有限公司), a company engaged in infrastructure development, manufacturing and real estate, where she served as a financial controller of its subsidiary, Shenzhen Kingway Brewery Holdings Limited (深圳金威啤酒集團有限公司)from December 2002 to December 2004, and last served as a deputy general manager of finance department of the group, where she was primarily responsible for the financial management of the group and establishment of the information system for financial management. From April 2006 to July 2008, she worked in Hopson Development Holdings Limited (合生創展集團有限公司), whose shares are listed on the Main Board of the Stock Exchange (stock code: 754), a property developer, where she last served as a vice president and the accounting controller of the Group, where she was primarily responsible for financial management. From July 2008 to June 2014, she worked in China Aoyuan Group Limited (中國奧園集團股份有限公司) (previously known as China Aoyuan Property Group Limited (中國奧園地產集團股份有限公司)), whose shares are listed on the Main Board of the Stock Exchange (stock code: 3883), a property developer, with her last concurrent positions held as an executive director and an executive vice president, where she was primarily responsible for financial management and fund management. She was also involved in review, discussion and decisions making of land acquisition when she worked at China Aoyuan Group Limited. From July 2014 to March 2015, she served as the chief financial officer of Logan Property Holdings Company Limited (龍光地產控股有限公司), whose shares are listed on the Main Board of the Stock Exchange (stock code: 3380), where she was primarily responsible for financing.

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Since June 2018, Ms. Xin has been serving as an independent non-executive director of CanSino Biologics Inc. (康希諾生物股份公司), whose shares are listed on the Main Board of the Stock Exchange (stock code: 6185), a company engaged in the research and development, manufacturing and sales of vaccines. Since April 2020, she has been serving as an independent non-executive director of Central China New Life Limited (建業新生活有限公司), whose shares are listed on the Main Board of the Stock Exchange (stock code: 9983), a property management service provider. Since November 2020, she has been an independent non-executive director of Datang Group Holdings Limited (大唐集團控股有限公司), whose shares are listed on the Main Board of the Stock Exchange (stock code: 2117), a property development company.

Ms. Xin became a member of the Chinese Institute of Certified Public Accountant of the PRC in January 1996 and a member of the CPA Australia in January 2010. Ms. Xin completed an undergraduate in accounting from Renmin University of China (中國人民大學) in the PRC in July 1990 and a master’s degree in business administration from Auckland Institute of Studies in New Zealand in December 1999.

Save as disclosed above, none of our Directors has any other directorships in listed companies during the three years immediately prior to the date of this document.

Save as disclosed above, each of our Directors has confirmed that there are no other matters relating to his/her appointment as a Director that need to be brought to the attention of our Shareholders and there is no other information in relation to his/her appointment which is required to be disclosed pursuant to Rule 13.51(2) of the Listing Rules.

SUPERVISORS

In accordance with the Company Law of the PRC, all joint stock companies are required to establish a supervisory committee, responsible for supervising the board of directors and senior management on fulfilling their respective duties, financial performance, internal control management and risk management of the corporation. The Supervisory Committee consists of five members comprising two employee representative Supervisors, and three shareholder representative Supervisors.

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The detailed information of our Supervisors is listed below.

Date of Time of joining Existing positions appointment as Name Age our Group in our Company Supervisors Responsibilities

Mr. Zhang Zhi 55 July 2001 Chairman of the April 13, 2016 Responsible for supervising the (張志) Supervisory Committee, Board and the senior chairman to the labor management of our Company union , and shareholder representative Supervisor

Mr. Liang Xiaobin 44 April 2016 Shareholder representative April 13, 2016 Responsible for supervising the (梁曉斌) Supervisor Board and the senior management of our Company

Mr. Wang Junling 45 December 1999 Employee representative April 25, 2019 Responsible for supervising the (王俊嶺) Supervisor Board and the senior management of our Company

Mr. Xin Zhiqiang 38 March 2021 Shareholder representative March 20, 2021 Responsible for supervising the (辛智強) supervisor Board and the senior management of our Company

Mr. Yu Songdong 48 October 1999 Employee representative April 25, 2019 Responsible for supervising the (余頌東) Supervisor Board and the senior management of our Company

Mr. Zhang Zhi (張志), aged 55, was appointed as a shareholder representative Supervisor and the chairman of the Supervisory Committee on April 13, 2016, where he is mainly responsible for supervising the Board and the senior management of the Company.

In July 2001, he joined our Group and consecutively served at multiple positions. From July 2001 to October 2002, he served as a chief officer in the enterprise development and research office, from November 2002 to November 2004 as the manager of marketing development department, from December 2004 to February 2006 as a project manager, from March 2006 to September 2009 as the manager of our Shanghai branch, and from October 2009 to September 2012 as the manager of the East China Region. From October 2012 to April 2015, Mr. Zhang served as the general manager of Shenzhen Ruishang Commercial Operation Management Co., Ltd. (深圳睿商商業經營管理有限公司), a company primarily engaged in providing commercial and operational management services, where he was primarily responsible for the overall operations and management of the company. Since May 2015, he has been serving as the chairman of the labor union.

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Mr. Zhang graduated from Shanxi Youth Management Vocational College (陝西青年管理幹部學院) majoring in administrative management in the PRC in July 1985.

Mr. Liang Xiaobin (梁曉斌), aged 44, was appointed as a shareholder representative Supervisor on April 13, 2016 and he is mainly responsible for supervising the Board and the senior management of our Company.

From January 2010 to December 2013, Mr. Liang served as a general manager of the auditing management department in Shenzhen Centralcon Group Co., Ltd. (深圳市中洲集團有限公司), where he was primarily responsible for management of financial reporting and auditing of the company. From December 2013 to June 2016, Mr. Liang served as a general manager of the audit and risk management department in Centralcon Holding, where he was primarily responsible for the overall management of the department. Since June 2016, Mr. Liang has been serving as the financial controller of Shenzhen Centralcon Property Management Co., Ltd. (深圳中洲物業管理有限公司), where he has been primarily responsible for the overall financial reporting and auditing matters of the company.

Mr. Liang obtained his bachelor’s degree in accounting from Beijing Institute of Technology (北京理工大學) in the PRC in July 1999.

Mr. Wang Junling (王俊嶺), aged 45, was appointed as an employee representative Supervisor on April 25, 2019 and he is mainly responsible for supervising the Board and the senior management of our Group.

Mr. Wang joined our Group in December 1999 as a head of information technology, where he was primarily responsible for network and information system related support and was promoted to a manager of career support department in June 2004, where he was primarily responsible for the training of employees until December 2007. From December 2007 to February 2011, he served as a career supporting manager of our Company, where he was primarily responsible for the training of employees. From February 2011 to December 2017, Mr. Wang served as a deputy manager of our human resources department, where he was primarily responsible for human resources related matters. Since January 2018, Mr. Wang has successively served as the officer and the head in the Yiying Qingteng labor committee office, where he was primarily responsible for establishment of community interpersonal relationships and the operations of the communities, and concurrently served as the dean of the Yiying Qingteng School from January 2018 to December 2020.

Mr. Wang was accredited as a certified property manager (註冊物業管理師)bythe Department of Human Resources and Social Security of Guangdong Province (廣東省人力源和社會保障廳) in the PRC in April 2011 and as a certified property manager (註冊物業管理師) by the Ministry of Housing and Urban-Rural Development (住房和城鄉建設部)inthe PRC in May 2013.

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Mr. Wang obtained his bachelor’s degree in laws from Nanjing University (Network Education) (南京大學（網路教育）) in the PRC in March 2014 and his master’s degree in engineering from Jilin University (吉林大學) in the PRC in June 2015.

Mr. Xin Zhiqiang (辛智強), aged 38, was appointed as a shareholder representative Supervisor on March 20, 2021 and he is mainly responsible for supervising the Board and the senior management of the Company.

From December 2006 to August 2012, Mr. Xin worked as a lawyer in Beijing King & Bond Law Firm (北京振邦律師事務所). From August 2014 to March 2017, Mr. Xin served as a senior manager at CNOOC International Energy Service (Beijing) Co., Ltd. (中海石油國際能源服務（北京）有限公司), an oil and gas exploration and development company, where he was mainly responsible for providing internal legal advice for the company. Since April 2017, Mr. Xin has been serving as a vice president of Shanghai Qiansheng Investment Management, LLP (上海虔盛投資管理企業（有限合夥）), an assets management company, where he was mainly responsible for overseeing overall legal and compliance related matters for the company.

Mr. Xin obtained his legal profession qualification by the Ministry of Justice in the PRC in March 2010. He obtained his bachelor’s degree in laws from Guangdong University of Foreign Studies (廣東外語外貿大學) in the PRC in June 2006 and his master’s degree in laws (financial services) from IIT Chicago-kent College of Law, Chicago in the United States of America in May 2013.

Mr. Yu Songdong (余頌東), aged 48, was appointed as an employee representative Supervisor on April 25, 2019 and he is mainly responsible for providing supervising the Board and the senior management of the Company.

Mr. Yu joined our Group in October 1999 and successively served as the head of management offices until August 2004, where he was primarily responsible for on-site operations and management of property projects. From August 2004 to December 2006, Mr. Yu served as a consultant in property consulting department, where he was primarily responsible for consultancy on property projects. From December 2006 to September 2007, Mr. Yu served as a manager of general affairs department in the Shenzhen branch, where he was primarily responsible for management of general affairs in the Shenzhen branch. From September 2007 to June 2014, he served as the general manager in both of our group planning and development department and the marketing strategy department, where he was primarily responsible for the strategic planning, development and marketing matters of our Group. Since January 2016, Mr. Yu served as the administrative director of the administrative matters center, where he has been primarily responsible for the overall management of the administrative matters in our Group. Since December 2017, he has also been serving as an assistant to the president, where he has mainly been responsible for providing daily support to senior management.

Mr. Yu was accredited as a certified property manager (註冊物業管理師)bythe Department of Human Resources and Social Security of Guangdong Province (廣東省人力資源和社會保障廳) in the PRC in April 2011.

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Mr. Yu obtained his bachelor’s degree in economics from Shenzhen University (深圳大學) in the PRC in June 1995 and has completed the advanced seminar on business administration for executives at the Educational Training and Management Office of Tsinghua University (清華大學教育培訓管理處) (currently knows as the School of Continuing Education of Tsinghua University (清華大學繼續教育學院)) in the PRC in March 2011.

SENIOR MANAGEMENT

Our executive Directors are responsible for the day-to-day operations and management of the business of our Group. For the biographical details of Mr. Chen Yaozhong, Mr. Liang Zhijun, Mr. Lv Yuhua and Mr. Yin Shanfeng, please refer to “—Board of Directors —Executive Directors” in this section.

The detailed information of our other members of senior management are listed below.

Date of appointment Time of joining Existing positions as senior Name Age our Group in our Company management Responsibilities

Mr. Fan Zhiwei 46 March 2002 Deputy general manager, May 25, 2012 Responsible for financial (范治威) chief financial officer management, financing and secretary to the management and Board implementation and matters related to the Board and shareholders’ meetings of our Company

Mr. Cao Kelong 55 March 1996 Deputy general manager August 11, 2009 Responsible for the overall (曹科龍) operations and management of the West China Region

Mr. Jiang Wei 48 June 2003 Deputy general manager January 27, 2016 Responsible for the overall (蔣偉) operations and management of the Bohai Region of our Group

Mr. Zheng Haoyuan 48 June 2001 Deputy general manager June 3, 2016 Responsible for the overall (鄭皓元) operations and management of Louyu technology division

Mr. Xiao Jiarui 39 June 2007 Deputy general manager January 27, 2016 Responsible for the overall (肖家銳) operations and management of the business department

Mr. He Shuang 42 July 2001 Deputy general manager March 14, 2020 Responsible for the overall (何霜) operations and management in Central China Region

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Mr. Fan Zhiwei (范治威), aged 46, was appointed as a deputy general manager and secretary to the Board on May 25, 2012 and he is mainly responsible for the financial management, financing management and implementation and matters related to Board and shareholders’ meetings of our Company.

Mr. Fan joined our Group in March 2002 and successively served as the head of finance department, an assistant to the general manager and a deputy general manager. He has been serving as the chief financial officer of the Company since December 12, 2014.

Mr. Fan obtained a certificate of qualification of accounting professional from the Finance Bureau of Shenzhen City (深圳市財政局) in the PRC in September 2005, a qualification certificate of specialty and technology at an intermediate level in accounting from the Ministry of Finance in PRC in September 2003, and as a certified property manager (註冊物業管理師) by the Department of Labor and Social Security of Guangdong Province (廣東省人力資源和社會保障廳) in the PRC in April 2011.

Mr. Fan obtained his bachelor’s degree in economics from Zhongnan University of Finance and Economics (中南財經大學) (currently known as Zhongnan University of Economics and Law (中南財經政法大學)) in the PRC in June 1998.

Mr. Cao Kelong (曹科龍), aged 56, was appointed as a deputy general manager on August 11, 2009 and he is mainly responsible for the overall operations and management in the West China Region.

Mr. Cao joined our Group in March 1996 and has successively served as a deputy chief engineer and the head of security department and engineering department, until he was promoted to a deputy general manager in where he was primarily responsible for improvement of the orderliness, environment and quality of our property management services.

From October 1993 to October 1995, he served as a deputy general manager and chief engineer at Shenzhen Changcheng Engineering Co. Ltd. (深圳長城工程公司) (currently known as Shenzhen Yingcan Construction Co., Ltd. (深圳市盈燦建設有限公司)), where he was primarily responsible for operations and construction property management, as the responsible person for technical matters.

Mr. Cao was accredited as a certified engineer by the Department of Personnel of Hunan Province (湖南省人事廳) (currently known as the Department of Human Resources and Social Security of Hunan Province (湖南省人力資源和社會保障廳)) in the PRC in August 1993, and a certified property manager (註冊物業管理師) by Ministry of Housing and Urban-Rural Development (住房和城鄉建設部) in the PRC in May 2013.

Mr. Cao obtained his bachelor’s degree in civil engineering from Chongqing Architectural Engineering College (重慶建築工程學院) (currently known as the School of Civil Engineering of Chongqing University (重慶大學土木工程學院)) in the PRC in July 1987 and executive master of business administration through long distance learning courses from The University of Texas at Arlington in the United States of America in August 2014.

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Mr. Jiang Wei (蔣偉), aged 48, was appointed as a deputy general manager on January 27, 2016 and is mainly responsible for the overall operation and management of the Bohai Region of our Group.

In June 2003, Mr. Jiang joined our Group, and successively served as a manager of Changcheng Environment Engineering Property Co. Ltd. (長城環境工程公司), a manager of the property management department, the general manager of Shenchangcheng Consulting Co. Ltd. (深長城諮詢公司). From January 2015 to December 2018, he concurrently served as a vice president and the head of collaborative development division, where he was primarily responsible for the development of EINWIN Cloud Alliance.

Prior to joining our Group, from July 1994 to June 2000, Mr. Jiang served as a landscape engineer in Zhuzhou Road Greening Management Office (株洲市道路綠化管理處), where he was primarily responsible for the management of maintenance on municipal road greening and construction of garden greening projects. From February 2002 to June 2003, he served at Shenzhen Chinese Town Property Management Co., Ltd. (深圳市華僑城物業管理有限公司), where he was primarily responsible for the provision and management of customer services.

Mr. Jiang was accredited as a certified property manager (註冊物業管理師) by the Department of Labor and Social Security (廣東省人力資源和社會保障廳) in the PRC in October 2010. He obtained his bachelor’s degree in forestry from Central South College of Forestry (中南林業學院) (currently known as Central South University of Forestry and Technology (中南林業科技大學)) in the PRC in July 1994.

Mr. Zheng Haoyuan (鄭皓元), aged 48, was appointed as our a deputy general manager on June 3, 2016 and he is mainly responsible for the overall operations and management of Louyu technology division.

Mr. Zheng joined our Group in June 2001 and successively served as a project manager, the general manager of Changcheng Louyu Technology and the general manager of Changcheng Elevator. Since June 2016, Mr. Zheng has been serving as a deputy general manager of the Group, and from October 2017 to December 2020, he concurrently served as the regional head of South China Region, where he was primarily responsible for the overall operations and management in the South China Region. Since January 2021, he has been serving as the head of Louyu technology division, where he was primarily responsible for the overall operations and management of the division.

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Mr. Zheng was accredited as a certified second-class constructor (註冊二級建造師) by the Department of Housing and Urban-Rural Development of Guangdong Province (廣東省住房和城鄉建設廳) in the PRC in June 2011, and as a certified property manager (註冊物業管理師) by the Ministry of Housing and Urban-Rural Development (住房和城鄉建設部) in the PRC in August 2013.

Mr. Zheng obtained a diploma in property management from Jinan University (暨南大學) in the PRC in December 2004, and a diploma in electrical engineering from China University of Geosciences (中國地質大學) in the PRC in January 2017.

Mr. Xiao Jiarui (肖家銳), aged 39, was appointed as a deputy general manager on January 27, 2016 and he is mainly responsible for the overall operations and management of the business department.

He joined our Group in June 2007 and has been consecutively served as a project manager, the marketing director of South China Region, the head of Central China Region, the general manager of Foshan Chengjiruishang the chief marketing officer of the Company, the head of North China Region and the head of strategic clientele division, where he was primarily responsible for project management, expansion of markets, exploitation in regional markets, commercial operations, the overall operations of certain regions and divisions in entirety. Prior to joining our Group, from July 2005 to June 2007, Mr. Xiao successively served as an officer at the quality department, the head of customer services of a project named Crystal City, and the chief of management office of Huibin Plaza of Shenzhen Shifang Property Management Co., Ltd. (深圳市世房物業管理有限公司).

Mr. Xiao obtained the National Property Management Enterprise Manager Certificate (全國物業管理企業經理證書) issued by the Personnel Education Division (人事教育司) and Housing and Real Estate Industry Division (住宅與房地產業司) of the Ministry of Construction (建設部) (currently known as the Ministry of Housing and Urban-Rural Development (住房和城鄉建設部)) in the PRC in April 2007, and was accredited as a certified property manager (註冊物業管理師) by the Ministry of Housing and Urban-Rural Development (住房和城鄉建設部) in the PRC in May 2013.

Mr. Xiao obtained his bachelor’s degree in computer science and technology from Central China Normal University (華中師範大學) in the PRC in July 2005.

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Mr. He Shuang (何霜), aged 42, was appointed as a deputy general manager on March 14, 2020 and he is mainly responsible for the overall operations and management in Central China Region.

Mr. He joined our Group in July 2001 and has successively served as a project manager and the general manager of Fuzhou branch and Shenzhen branch, where he was mainly responsible for the management of projects and operations and management of the branches, respectively.

Mr. He obtained a qualification certificate of specialty and technology at an intermediate level in tourism from the Ministry of Personnel (人事部) (currently known as the Ministry of Human Resources and Social Security (人力資源和社會保障部)) in the PRC in November 2006 and as a senior economist by the Department of Human Resources and Social Security of Hubei Province (湖北省人力資源和社會保障廳) in the PRC in December 2020. Mr. He obtained his bachelor’s degree in tourism management from Sun Yat-Sen University (中山大學) in the PRC in July 2001.

JOINT COMPANY SECRETARY

Mr. Fan Zhiwei (范治威), aged 46, was appointed as our joint company secretary on May 24, 2021. For details of Mr. Fan, please refer to “Senior Management” in this section.

Ms. Chan Yin Wah (陳燕華), aged 45, was appointed as our joint company secretary on May 24, 2021 and is primarily responsible for company secretarial matters of our Group.

Ms. Chan is an associate director of SWCS Corporate Services Group (Hong Kong) Limited, a professional services provider specialized in corporate services, and has over 19 years of professional experience in handling corporate secretarial and compliance matters for listed companies in Hong Kong. Ms. Chan currently serves as the company secretary at Starrise Media Holdings Limited (星宏傳媒控股有限公司), formerly known as Silverman Holdings Limited (銀仕來控股有限公司) (stock code: 1616), CCID Consulting Company Limited (賽迪顧問股份有限公司) (stock code: 8235) and Yihai International Holding Ltd. (頤海國際控股有限公司) (stock code: 1579). All the above companies are listed on the Stock Exchange.

Ms. Chan obtained a bachelor degree in economics from the University of Hong Kong in December 1997 in Hong Kong, and a master degree in professional accounting from the Hong Kong Polytechnic University in November 2002 in Hong Kong. She is a fellow member of The Hong Kong Institute of Chartered Secretaries and The Chartered Governance Institute in the United Kingdom. She is also a fellow member of the Association of Chartered Certified Accountants.

BOARD COMMITTEES

Our Board has established the audit committee, the remuneration committee and the nomination committee and delegated various responsibilities to these committees, which assist our Board in discharging its duties and overseeing particular aspects of our Group’s activities.

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Audit Committee

We have established an audit committee on May 10, 2021 with written terms of reference in compliance with Rule 3.21 of the Listing Rules and paragraph C.3 of the Corporate Governance Code (“CG Code”) as set out in Appendix 14 to the Listing Rules. The audit committee consists of three members, namely Ms. Xin Zhu (辛珠), Mr. Wu Yajun (武亞軍) and Mr. Ma Xingwen (馬興文). The chairman of the audit committee is Ms. Xin Zhu (辛珠), who is an independent non-executive Director of our Company and became a member of the Chinese Institute of Certified Public Accountant of the PRC in January 1996 and a member of the CPA Australia in January 2010.

The primary duties of the audit committee include, but not limited to (i) review and supervise our financial reporting process and internal control system of our Group, risk management and internal audit; (ii) provide advice and comments to our Board and perform other duties and responsibilities as may be assigned by our Board.

Remuneration Committee

We have established a remuneration committee on May 10, 2021 with written terms of reference in compliance with Rule 3.25 of the Listing Rules and paragraph B.1 of the CG Code as set out in Appendix 14 of the Listing Rules. The remuneration committee consists of three members, namely Mr. Cao Yang (曹陽), Mr. Chen Yaozhong (陳耀忠) and Mr. Wu Yajun (武亞軍). The chairman of the remuneration committee is Mr. Cao Yang (曹陽), who is an independent non-executive Director of our Company.

The primary duties of the remuneration committee include, but not limited to (i) establish, review and provide advices to our Board on our policy and structure concerning remuneration of our Directors, Supervisors and senior management and on the establishment of a formal and transparent procedure for developing policies concerning such remuneration; (ii) determine the terms of the specific remuneration package of each executive Director and senior management; and (iii) review and approve performance-based remuneration by reference to corporate goals and objectives resolved by our Directors from time-to-time.

Nomination Committee

We have established a nomination committee on May 10, 2021 with written terms of reference in compliance with paragraph A.5 of the CG Code as set out in Appendix 14 of the Listing Rules. The nomination committee consists of three members, namely Mr. Chen Yaozhong (陳耀忠), Mr. Cao Yang (曹陽) and Mr. Wu Yajun (武亞軍). The chairman of the nomination committee is Mr. Chen Yaozhong (陳耀忠), who is an executive Director of our Company.

The primary duties of the nomination committee include, but not limited to (i) review the structure, size and composition of our Board on a regular basis and make recommendations to the Board regarding any proposed changes to the composition of our Board; (ii) identify, select or make recommendations to our Board on the selection of individuals nominated for directorship, and ensure the diversity of our Board members; (iii) assess the independence of our independent non-executive Directors; and (iv) make recommendations to our Board on relevant matters relating to the appointment, reappointment and removal of our Directors and succession planning for our Directors.

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BOARD DIVERSITY POLICY

Our Board [has adopted] a board diversity policy which sets out the approach to achieve diversity on our Board. Our Company recognizes and embraces the benefits of having a diverse Board and sees increasing diversity at Board level as an essential element in supporting the attainment of our Company’s strategic objectives and sustainable development. Our Company seeks to achieve Board diversity through the consideration of a number of factors, including but not limited to gender, age, cultural and educational background, ethnicity, professional experience, skills, knowledge and length of service. All Board appointments will be based on meritocracy and candidates will be considered against objective criteria, having due regard to the benefits of diversity on our Board.

Our Board currently comprises nine members, including one female independent non-executive Director. Our Directors also have a balanced mix of knowledge, skills and experience, including overall management and strategic development, human resources, information technology, accounting and financial management, and corporate governance. They obtained degrees in various majors including business administration, property management, law, computer science, economics and engineering. We have three independent non-executive Directors with different industry backgrounds, representing a third of the members of our Board. Furthermore, our Board has a wide range of age, ranging from 42 years to 68 years old. Taking into account our existing business model and specific needs as well as the different background of our Directors, the composition of our Board satisfies our board diversity policy.

With regards to gender diversity on the Board, our board diversity policy further provides that our Board shall take opportunities to increase the proportion of female members over time when selecting and making recommendations on suitable candidates for Board appointments. Our Board would ensure that appropriate balance of gender diversity is achieved with reference to stakeholders’ expectation and international and local recommended best practices, with the ultimate goal of bringing our Board to gender parity.

Our nomination committee is responsible for ensuring diversity within our Board members and will use its best efforts to identify and recommend suitable candidates, including female candidates, for the Board’s consideration. We also welcome candidates of different gender to apply for our mid to senior level positions. The ultimate decision of the appointment will be based on merits and the contribution which the selected candidates could bring to our Board and management team. Our Board believes that such merit-based selection criteria will best enable our Company to serve our Shareholders and other stakeholders going forward. After [REDACTED], our nomination committee will review our board diversity policy and its implementation from time to time to ensure its implementation and monitor its continued effectiveness, and the same will be disclosed in our corporate governance report, including any measurable objectives set for implementing the board diversity policy and the progress on achieving these objectives on an annual basis.

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COMPENSATION OF DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT

Our Directors and Supervisors receive compensation from our Company in the form of salaries, housing allowance and contributions to a retirement benefit scheme.

The remuneration (including fees, salaries, housing allowance and contributions to a retirement benefit scheme and other allowance and benefits in kind) paid to our Directors and Supervisors in aggregate for the three years ended December 31, 2018, 2019 and 2020 and the three months ended March 31, 2021 were approximately RMB4.15 million, RMB10.30 million, RMB10.73 million and RMB1.97 million, respectively.

The remuneration (including wages, salaries and bonuses, pension costs, housing funds, medical insurance and other social insurances) paid to our Group’s five highest paid individuals included three Directors during the Track Record Period and the three months ended March 31, 2021, respectively. The remuneration payable to the remaining two individuals during the Track Record Period were approximately RMB2.12 million, RMB3.77 million, RMB3.89 million and RMB5.94 million, respectively.

During the Track Record Period, no remuneration was paid by us to, or receivable by, our Directors, Supervisors or the five highest paid individuals as an inducement to join or upon joining our Company as a compensation for loss of office in respect of the years ended December 31, 2018, 2019 and 2020 and the three months ended March 31, 2021.

None of our Directors and Supervisors had waived or agreed to waive any remuneration during the Track Record Period. Under the current arrangements, our Directors and Supervisors are entitled to receive compensation (including fees, salaries, housing allowance and contributions to a retirement benefit scheme) from our Company for the year ending December 31, 2021 under arrangement in force as of the date of this document which is approximately RMB12.30 million in aggregate.

Our Board will review and determine the remuneration and compensation packages of our Directors, Supervisors and senior management and will, following the [REDACTED], receive recommendation from our remuneration and appraisal committee which will take into account salaries paid by comparable companies, time commitment and responsibilities of our Directors and Supervisors and performance of our Group.

Save as disclosed above, no other payments had been made, or are payable, by any member of our Group to our Directors and Supervisors during the Track Record Period. For additional information on our Directors and Supervisors’ remuneration during the Track Record Period as well as information on the highest paid individuals, please refer to Note 40 in the Accountant’s Report set out in Appendix I to this document.

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COMPLIANCE ADVISOR

Our Company has appointed Maxa Capital Limited as our compliance advisor pursuant to Rule 3A.19 of the Listing Rules. The material terms of the compliance advisor’s agreement entered into between our Company and the compliance advisor are as follows:

(a) the compliance advisor shall provide our Company with services including guidance and advice as to compliance with the requirement of the Listing Rules and other applicable laws, rules, codes and guidelines, and accompany our Company to any meetings with the Stock Exchange;

(b) our Company may terminate the appointment of the compliance advisor by giving a no less than 30 days’ prior written notice to the compliance advisor. Our Company will exercise such right in compliance with Rule 3A.26 of the Listing Rules. The compliance advisor will have the right to terminate its appointment as compliance advisor under certain specific circumstances and upon notification of the reason of its resignation to the Stock Exchange; and

(c) during the period of appointment, our Company must consult with, and if necessary, seek advice from the compliance advisor on a timely basis in the following circumstances:

i. before the publication of any regulatory announcement, circular or financial report;

ii. where a transaction, which might be a notifiable or connected transaction, is contemplated, including share issues and share repurchases;

iii. where we propose to use the proceeds of the [REDACTED] in a manner different from that detailed in this document or where our business activities, developments or results materially deviate from any forecast, estimate, or other information in this document; and

iv. where the Stock Exchange makes an inquiry of our Company regarding unusual movements in the price or trading volume of our Shares.

The term of the appointment shall commence on the [REDACTED] and end on the date on which we distribute our annual report in respect of our financial results for the first full financial year commencing after the [REDACTED].

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CORPORATE GOVERNANCE CODE

Our Directors recognize the importance of incorporating elements of good corporate governance in the management structures and internal procedures of our Group so as to achieve effective accountability. Our Company has adopted the code provisions stated in the CG Code.

Our Company is committed to the view that our Board should include a balanced composition of executive Directors and independent non-executive Directors so that there is a strong independent element on the Board, which can effectively exercise independent judgment.

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Immediately before the [REDACTED]

As of the Latest Practicable Date, the share capital of our Company was RMB87,212,834.00, divided into 87,212,834 Shares, with a nominal value of RMB1.00 each.

Upon the Completion of the [REDACTED]

Assuming the [REDACTED] is not exercised, the share capital of our Company immediately after the completion of the [REDACTED] and conversion of Domestic Shares into H Shares will be as follows:

Approximate percentage of Number of total share Shares Description of Shares capital

87,212,834 H Shares to be converted from [REDACTED]% Domestic Shares Note [REDACTED] H Shares to be issued under the [REDACTED] [REDACTED]%

[REDACTED] 100%

Note: Please refer to “Corporate Structure After the [REDACTED]” in “History, Reorganization and Corporate Structure” for details of the identities of the shareholders whose Shares will be converted into H Shares upon the [REDACTED].

Assuming the [REDACTED] is exercised in full, the share capital of our Company immediately after the completion of the [REDACTED] and Conversion of Domestic Shares into H Shares will be as follows:

Approximate percentage of Number of total share Shares Description of Shares capital

87,212,834 H Shares to be converted from [REDACTED]% Domestic Shares Note [REDACTED] H Shares to be issued under the [REDACTED] [REDACTED]%

[REDACTED] 100%

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SHARE CLASSES

Upon the completion of [REDACTED] and conversion of Domestic Shares into H Shares, the Shares of our Company will be divided into two categories: Domestic Shares and H Shares. The two classes of Shares are both ordinary shares in the share capital of our Company. H Shares may only be subscribed for and traded in Hong Kong dollars. Domestic Shares may only be subscribed for and traded in RMB. Apart from certain qualified domestic institutional investors in the PRC, the qualified PRC investors under the Shanghai-Hong Kong Stock Connect, the Shenzhen-Hong Kong Stock Connect or other persons who are entitled to hold our H Shares pursuant to relevant PRC laws and regulations or upon approvals of any competent authorities, H Shares generally cannot be subscribed for by or traded between legal or natural persons of the PRC. Domestic Shares, on the other hand, can be subscribed for by and traded between legal or natural persons of the PRC, qualified foreign institutional investors. We must pay all dividends in respect of H Shares in Hong Kong dollars, all dividends in respect of Domestic Shares in RMB.

Except as described above and in relation to the dispatch of notices and financial reports to our Shareholders, dispute resolution, registration of Shares in different parts of our register of Shareholders, methods of share transfer and the appointment of dividend receiving agents, which are all provided for in the Articles of Association and summarized in Appendix VI to this document, our Domestic Shares and H Shares will rank equally with each other in all respects and, in particular, will rank equally for all dividends or distributions declared, paid or made after the date of this document (save for the dividends payment in RMB for Domestic Shares, in foreign currency except for RMB for Domestic Shares and in Hong Kong dollars for H Shares). However, the transfer of Domestic Shares is subject to such restrictions as PRC laws may impose from time to time. Save for the [REDACTED], we do not propose to carry out any public or private issue or to place securities simultaneously with the [REDACTED] or within the next six months from the [REDACTED]. We have not approved any share issue plan other than the [REDACTED].

CONVERSION OF OUR DOMESTIC SHARES INTO H SHARES

If any of the Domestic Shares are to be converted, [REDACTED] and traded as H Shares on the Stock Exchange, such conversion, [REDACTED] and trading will need the approval of the relevant PRC regulatory authorities, including the CSRC, and the approval of the Stock Exchange.

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Listing Review and Approval by the CSRC

Listing Review and Approval by the CSRC In accordance with the Guidelines for the “Full Circulation” Program for Domestic Unlisted Shares of H-share Listed Companies《 ( H股公司境內未上市股份申請「全流通」業務指引》) announced by the CSRC, H-share listed companies which apply for the conversion of domestic shares into H shares for [REDACTED] and circulation on the Stock Exchange shall file the application with the CSRC according to the administrative licensing procedures necessary for the “examination and approval of public issuance and listing (including additional issuance) of overseas shares by a joint stock company”. An H-share listed company may apply for a “Full Circulation” separately or when applying for refinancing overseas. An unlisted domestic joint stock company may apply for “full circulation” when applying for an overseas initial public offering.

[REDACTED]

[REDACTED] Approval by the Stock Exchange

We have applied to the Stock Exchange for the granting of [REDACTED] of, and permission to [REDACTED], our H Shares to be issued pursuant to the [REDACTED] (including any H Shares which may be issued pursuant to the exercise of the [REDACTED]) and the H Shares to be converted from 87,212,834 Domestic Shares on the Stock Exchange, which is subject to the approval by the Stock Exchange. We will perform the follow procedures for the conversion of domestic [REDACTED] shares into H Shares after receiving the approval of the Stock Exchange: (i) giving instructions to our H Share Registrar regarding relevant share certificates of the converted H Shares; and (ii) enabling the converted H Shares to be accepted as eligible securities by [REDACTED] for deposit, clearance and settlement in the [REDACTED]. The Domestic Participating Shareholders may only [REDACTED] the Shares upon completion of following domestic procedures.

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Domestic Procedures

The Domestic Participating Shareholders may only [REDACTED] the Shares upon completion of the below arrangement procedures for the registration, deposit and transaction settlement in relation to the conversion and [REDACTED]:

(a) We will appoint CSDC as the nominal holder to deposit the relevant securities at CSDC (Hong Kong), which will then deposit the securities at [REDACTED] in its own name. CSDC, as the nominal holder of the Domestic Participating Shareholders, shall handle all custody, maintenance of detailed records, cross-broader settlement and corporate actions, etc. relating to the converted H Shares for the Domestic Participating Shareholders;

(b) We will engage a domestic securities company (the “Domestic Securities Company”) to provide services such as the transmission of sell orders and trading messages in respect of the converted H Shares. The Domestic Securities Company will engage a Hong Kong securities company (the “Hong Kong Securities Company”) for settlement of share transactions. We will make an application to CSDC, Shenzhen Branch for the maintenance of a detailed record of the initial holding of the converted H Shares held by our Shareholders. Meanwhile, we will submit applications for a domestic transaction commission code and abbreviation, which shall be confirmed by CSDC, Shenzhen Branch as authorized by SZSE;

(c) The SZSE shall authorize Shenzhen Securities Communication Co., Ltd. to provide services relating to transmission of trading orders and trading messages in respect of the Converted H Shares between the Domestic Securities Company and the Hong Kong Securities Company, and the real-time market forwarding services of the H Shares;

(d) According to the Notice of the SAFE on Issues Concerning the Foreign Exchange Administration of Overseas Listing《國家外匯管理局關於境外上市 ( 外匯管理有關問題的通知》), the Domestic Participating Shareholders shall complete the overseas shareholding registration with the local foreign exchange administration bureau before the Shares are sold, and after the overseas shareholding registration, open a specified bank account for the holding of overseas shares by domestic investors at a domestic bank with relevant qualifications and open a fund account for the H Share “[REDACTED]” at the Domestic Securities Company. The Domestic Securities Company shall open a securities trading account for the H Share “[REDACTED]” at the Hong Kong Securities Company; and

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(e) The Domestic Participating Shareholders shall submit trading orders of the Converted H Shares through the Domestic Securities Company. Trading orders of the Domestic Participating Shareholders for the relevant Shares will be submitted to the Stock Exchange through the securities trading account opened by the Domestic Securities Company at the Hong Kong Securities Company. Upon completion of the transaction, settlements between each of the Hong Kong Securities Company and CSDC (Hong Kong), CSDC (Hong Kong) and CSDC, CSDC and the Domestic Securities Company, and the Domestic Securities Company and the Domestic Participating Shareholders, will all be conducted separately.

As a result of the conversion, the shareholding of the relevant Domestic Participating Shareholders in our Domestic Share capital registered shall be reduced by the number of Domestic Shares converted and the number of H Shares shall be increased by the number of converted H Shares.

A Domestic Shareholders can work with our Company according to the Articles of Association and follow the procedures set out in this document to convert the Domestic Shares into H Shares after the [REDACTED] if they want, provided that such conversion of Domestic Shares into and [REDACTED] and trading of H Shares will be subject to the approval of the relevant PRC regulatory authorities, including the CSRC, the approval of the Stock Exchange and the satisfaction of the public float requirement under the Listing Rules by our Company.

TRANSFER OF SHARES ISSUED PRIOR TO [REDACTED]

The Company Law provides that in relation to the [REDACTED] of a company, the shares issued prior to the [REDACTED] shall not be transferred within a period of one year from the date on which the publicly [REDACTED] shares are [REDACTED] on any stock exchange. Accordingly, Shares issued by our Company prior to the [REDACTED] (including a total of 87,212,834 Shares to be converted from Domestic Shares held by our Shareholders) shall be subject to this statutory restriction and not be transferred within a period of one year from the [REDACTED].

Our Company will work with the Domestic Securities Company to be engaged by our Company to restrict the trading of the H Shares converted from Domestic Shares technically within one year after the [REDACTED].

Please refer to “[REDACTED]—[REDACTED]” for details of the lock-up undertaking given by our Controlling Shareholder to the Stock Exchange. Please refer to “[REDACTED]—[REDACTED]” for details of the lock-up undertaking given by our Controlling Shareholder under the [REDACTED].

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INCREASE IN SHARE CAPITAL

As advised by our PRC Legal Advisors, Global Law Office, pursuant to the Articles of Association and subject to the requirements of relevant PRC laws and regulations, our Company, upon the [REDACTED] of our H Shares, is eligible to enlarge its share capital by issuing either new H Shares or new Domestic Shares on condition that such proposed issuance shall be approved by a special resolution of Shareholders in general meeting and by holders of Shares of that class of Shareholders whose interest is affected in a separate meeting conducted in accordance with the provisions of the Articles of Association and that such issuance complies with the Listing Rules and other relevant laws and regulations of Hong Kong. To adopt a special resolution of Shareholders in general meeting, more than the two thirds votes represented by the Shareholders (including proxies) present at the general meeting must be exercised in favor of the resolution. Resolutions of a class of Shareholders shall be passed by votes representing more than two thirds of Shareholders with voting rights attending the class Shareholders’ meeting.

REGISTRATION OF SHARES NOT LISTED ON THE OVERSEAS STOCK EXCHANGE

According to the Notice of Centralized Registration and Deposit of Non-overseas Listed Shares of Companies Listed on an Overseas Stock Exchange《關於境外上市公司非 ( 境外上市股份集中登記存管有關事宜的通知》) issued by the CSRC, an overseas listed company is required to register its shares that are not listed on the overseas stock exchange with CSDC within 15 Business Days upon the listing and provide a written report to the CSRC regarding the centralized registration and deposit of its unlisted Shares as well as the current offering and listing of shares.

SHAREHOLDERS’ APPROVAL FOR THE [REDACTED]

Approval from holders of the Shares is required for our Company to issue H Shares and seek the [REDACTED] of H Shares on the Stock Exchange. Our Company has obtained such approval at the Shareholders’ general meeting held on May 10, 2021.

CIRCUMSTANCES UNDER WHICH GENERAL MEETING AND CLASS MEETING ARE REQUIRED

For details of circumstances under which our Shareholders’ general meeting and class Shareholders’ meeting are required, please refer to “Appendix VI—6. General Meeting” in this document.

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You should read the following discussion and analysis in conjunction with our audited consolidated financial statements, including the notes thereto set forth in the Accountant's Report set out in Appendix I to this document. The Accountant's Report has been prepared in accordance with HKFRS, which may differ in material aspects from generally accepted accounting principles in other jurisdictions.

The following discussion and analysis and other parts of this document contain forward-looking statements that reflect our current views with respect to future events and financial performance that involve risks and uncertainties. These statements are based on assumptions and analysis made by us in light of our experience and perception of historical events, current conditions and expected future developments, as well as other factors we believe are appropriate under the circumstances. In evaluating our business, you should carefully consider the information provided in “Risk Factors”, “Forward-looking Statements” and elsewhere in this document.

OVERVIEW

We do not rely on any affiliated property developer and therefore, market competitiveness has been the key driver of our success since our inception. As we have to compete for projects on the open market, we strive to develop keen insights for market trends and customer needs to provide services that are above the expectation of our customers. Our ability to succeed under market competition is testified by our proven track record in obtaining management projects from property developers and owners who are independent from us, and our dedication to customer services and continuing self-improvement has been reflected in our market recognition and customer loyalty.

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BASIS OF PREPARATION

The historical financial information of our Group has been prepared in accordance with principal accounting policies which are in accordance with the Hong Kong Financial Reporting Standards (“HKFRS”) issued by the HKICPA. The historical financial information has been prepared on a historical cost basis, except for the following:

• certain financial assets, investment properties and redeemable shares measured at fair value; and

• assets held for sale – measured at lower of carrying amount and fair value less cost to sell.

The preparation of historical financial information in conformity with HKFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in the process of applying our Group’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the historical financial information are disclosed in Note 4 in the Accountant’s Report in Appendix I to this document.

KEY FACTORS AFFECTING OUR RESULTS OF OPERATIONS

Our results of operations and financial position have been and will continue to be affected by a number of factors, including those set out in “Risk Factors” in this document and those discussed below:

Our GFA under Management

During the Track Record Period, we generated a majority of our revenue from our property management services, which amounted to RMB1,905.8 million, RMB2,196.2 million, RMB2,315.4 million, RMB538.5 million and RMB608.1 million, respectively, for 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, accounting for approximately 79.3%, 78.1%, 76.3%, 77.7% and 77.6% of our total revenue for the same periods, respectively. Accordingly, our business and results of operations depend on our ability to maintain and increase our GFA under management, which in turn is affected by our ability to secure new and renew existing property management service agreements. During the Track Record Period, we experienced a stable growth in our GFA under management, which was 84.4 million sq.m., 101.4 million sq.m., 109.4 million sq.m., and 114.6 million sq.m. as of December 31, 2018, 2019 and 2020 and March 31, 2021, respectively.

Our Branding and Pricing Ability

Our financial condition and results of operations are affected by our ability to continuously maintain or increase the fee rates we charge for our services, which is, in part, affected by our brand recognition and positioning in China’s property management industry. We leverage our branding in pricing our services, and take into account factors such as (i) the types and locations of the communities, (ii) our estimated costs and target profit margins, (iii) the profiles of property owners and residents, (iv) the required scope and quality of our services, and (v) the prices charged by our competitors for comparable properties. We may be subject to pricing control under the PRC laws and regulations with

– 240 – THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. FINANCIAL INFORMATION respect to our residential property management services. We strive to balance between competitive pricing and quality service. Failure to balance various factors in determining our pricing could materially and adversely affect our financial condition and results of operations. To strengthen our pricing power, we make efforts to diversify our services by offering more value-added services and further improving our service quality.

Our pricing ability can materially affect our results of operations. We set forth below a sensitivity analysis of our revenue and profit and total comprehensive income for the year with reference to the fluctuations of average property management fees for property management services during the Track Record Period for illustrative purposes. The sensitivity analysis below demonstrates the impact of the hypothetical decrease in average property management fees for property management services on our revenue and profit and total comprehensive income, while all other factors remain unchanged:

For the year ended For the three months December 31, ended March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000

Profit for the period 71,372 134,162 206,566 47,092 49,971 Assuming 2.5% decrease in our average property management fees Decrease in revenue from our property management service business 47,645 54,904 57,884 13,464 15,202 Decrease in profit and total comprehensive income for the year/period(1) 35,734 41,178 43,413 10,098 11,402 Assuming 5% decrease in our average property management fees Decrease in revenue from our property management service business 95,289 109,809 115,768 26,927 30,405 Decrease in profit and total comprehensive income for the year/period(1) 71,467 82,357 86,826 20,195 22,804

Note:

(1) Impact on profit and total comprehensive income for the year was calculated under the assumption that EIT was 25.0% for the year.

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Business Mix

During the Track Record Period, our financial condition and results of operations were affected by our business mix. Our profit margins vary across our four business lines, namely, property management services, value-added services to property developers, community value-added services and professional services. Any change in the structure of revenue contribution from our four business lines or change in profit margin of any business line may have a corresponding impact on our overall gross profit margin.

The table below sets forth the revenue contribution by business line for the years or periods indicated:

For the year ended December 31, For the three months ended March 31, 2018 2019 2020 2020 2021 RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 % (Unaudited)

Property management services 1,905,789 79.3 2,196,176 78.1 2,315,359 76.3 538,546 77.7 608,096 77.6 Value-added services to property developers 152,536 6.3 123,173 4.5 108,473 3.6 27,260 3.9 28,014 3.6 Community value-added services 236,151 9.8 321,237 11.4 368,304 12.1 89,392 12.9 107,536 13.7 Professional services 109,811 4.6 169,763 6.0 243,464 8.0 37,964 5.5 40,152 5.1

Total 2,404,287 100.0 2,810,349 100.0 3,035,600 100.0 693,162 100.0 783,798 100.0

The table below sets forth the gross profit margin by business line for the years or periods indicated:

For the year ended For the three months December 31, ended March 31, 2018 2019 2020 2020 2021 %%%%% (Unaudited)

Property management services 16.3 16.8 19.0 16.3 18.1 Value-added services to property developers 16.8 14.1 14.4 17.1 10.9 Community value-added services 22.0 26.2 30.2 35.2 36.3 Professional services 17.4 26.0 29.3 34.9 32.6

Overall gross profit margin 17.0 18.3 21.0 19.8 21.1

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In general, the gross profit margins of our community value-added services and professional services were higher than those of property management services and value-added services to property developers. The relatively higher gross profit margins for our community value-added services and professional services during the Track Record Period were primarily due to the fact that community value-added services and professional services are in general less labor-intensive than property management services and value-added services to property developers. Please see “—Description of Certain Consolidated Statements of Comprehensive Income—Gross Profit and Gross Profit Margin” for more discussion on the fluctuation in our gross profit margins during the Track Record Period.

Ability to Mitigate the Impact of Rising Labor Costs

Since property management is labor intensive, labor costs constitute a substantial portion of our cost of services. During the Track Record Period, our labor costs increased as a result of our business expansion. In 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, our labor costs (recorded as employee benefits expenses) recorded under our cost of services were RMB662.6 million, RMB791.8 million, RMB851.9 million, RMB203.1 million, and RMB240.6 million, respectively, accounting for 33.2%, 34.5%, 35.5%, 36.5% and 38.9% of our cost of services in the same periods, respectively. Our labor cost as a percentage of our total cost of services increased during the Track Record Period, primarily attributable to our business expansion, rising wages and our overall efforts to improve service quality by reducing our reliance on third party contractors and increasing the amount of services rendered by our own employees.

We have also outsourced certain services, such as security, cleaning, greening and gardening services, to third party subcontractors while maintaining close supervision over their services to ensure service quality. In 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, we incurred security, cleaning, greening and gardening expenses (which primarily consisted of subcontracting costs), of RMB780.5 million, RMB853.0 million, RMB891.6 million, RMB219.8 million and RMB223.7 million, respectively, representing 39.1%, 37.2%, 37.2%, 39.5% and 36.2%, respectively, of our cost of services in the same periods. The fluctuations in subcontracting costs during the Track Record Period was attributable to fluctuations in pricing terms with third party contractors, our overall efforts to improve service quality by reducing our reliance on third party contractors and increasing the amount of services rendered by our own employees, and, for the three months ended March 31, 2020, special expenses incurred relating to COVID-19 prevention and control measures. See “Business—Suppliers” in this document for further discussion.

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Competition

We primarily compete against national, regional and local property management companies in China. According to CIA, we were ranked 10th among the 2021 Top 100 Property Management Companies in China in terms of overall strength. See “Business—Competition” and “Industry Overview—Competition” in this document for more information. Our ability to compete effectively against our competitors and strengthen our market position depends on our ability to enhance our competitive strengths. If we fail to compete effectively and grow our GFA under management, we may lose our existing market position and experience decreased revenue and weakened profitability.

SIGNIFICANT ACCOUNTING POLICIES, JUDGMENTS AND ESTIMATES

When reviewing our consolidated financial statements, you should consider (i) our significant accounting policies, (ii) the judgments and other uncertainties affecting the application of such policies and (iii) the sensitivity of reported results to changes in conditions and assumptions. Our significant accounting policies, judgments and estimates, which are important for an understanding of our financial condition and results of operations, are set forth in detail in Notes 2 and 4 in the Accountant’s Report in Appendix I, respectively, to this document. We set forth below those accounting policies and estimates that we believe involve the most significant estimates and judgments used in the preparation of our financial statements.

Revenue recognition

We provide property management services, value-added services to property developers, community value-added services and professional services. Revenue is recognized when the control of services is transferred to the customers. Depending on the terms of the contracts and the laws that apply to the contract, control of services may be transferred over time or at a point in time.

We distinguish whether we act as principal or agent in the transactions with its customers. When we act as a principal, the associated revenue is recognized in gross amount and when we act as agent, the associated revenue is recognized in net amount.

Property management services

We bill a fixed amount for services provided on a monthly, quarterly or annually basis and recognize as revenue in the amount to which we have a right to bill and that corresponds directly with the value of performance completed. We primarily generate revenue from property management services income from properties managed under lump sum basis.

For property management service income from properties managed under commission basis, we recognize the commission, which is calculated by certain percentage of the total property management fee received or receivable from the property units, as our revenue for arranging and monitoring the services as provided by other suppliers to the property owners.

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Value-added services to property developers

Value-added services to property developers mainly include sales office management services at the pre-sale stage of property sales, comprising of (i) preliminary property management services, which include greening, securities and repair and maintenance services. Revenues of preliminary property management services are billed on a monthly basis and are recognized over time when such services are rendered; (ii) property inspection and pre-delivery on-site cleaning services to property developers which are recognized as revenue when we agree the price for these services with the customers upfront and issues monthly bill to the customers which varies based on the actual levels of services completed in that month.

Community value-added services

Revenue from community value-added services mainly includes (i) revenue from promotion and facilitation for third parties, which is recognized over time according to the services rendered; (ii) revenue from provision of purchase agency service to third parties, where we act as purchase agent and charge a service fee based on the scale of commodities being purchased on behalf of third parties, and recognize such service fee as revenue when the purchased commodities are delivered and the services are rendered; (iii) rental income from carpark spaces leased from the property owners; and (iv) income from management of advertising and other miscellaneous activities in the common areas in the properties managed by us, which is recognized over time when the services are rendered.

Professional services

Professional services mainly include engineering and maintenance services of elevator and intelligent security equipment. Revenue from professional services are recognized when the contracts have been approved and the services are rendered. Professional services are normally billable on a monthly basis when we have a right to bill the customers and recognize the revenue of these services accordingly.

If contracts involve the sale of multiple services, the transaction price will be allocated to each performance obligation based on their relative stand-alone selling prices. If the stand-alone selling prices are not directly observable, they are estimated based on expected cost plus a margin or adjusted market assessment approach, depending on the availability of observable information.

Leases

We as lessor under finance leases

At the commencement of the lease term, the aggregate of the minimum lease receivable at the inception of the lease and the initial direct costs is recognized as a finance lease receivable, and the unguaranteed residual value is recorded at the same time. The difference between the aggregate of the minimum lease receivable, the initial direct costs and the unguaranteed residual value, and the aggregate of their present values is recognized as unearned finance income.

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Unearned finance income is recognized as finance income using the effective interest method over the lease term. Contingent rentals under finance lease are recognized as revenue in the periods in which they are incurred.

We as lessor under operating leases

Lease income from operating leases where we act as lessor is recognized as income on a straight-line basis over the lease term. Initial direct costs incurred in obtaining an operating lease are added to the carrying amount of the underlying asset and recognized as expense over the lease term on the same basis as lease income. The respective leased assets are included in the balance sheet based on their nature. We do not need to make any adjustments to the accounting for assets held as lessor as a result of adopting the new leasing standard.

We as lessee

Leases are recognized as a right-of-use asset and a corresponding liability at the date at which the leased asset is available for use by us.

Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. The lease agreements do not impose any covenants other than the security interests in the leased assets that are held by the lessor. Leased assets may not be used as security for borrowing purposes.

Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include the net present value of the following lease payments:

• fixed payments(including in-substance fixed payments), less any lease incentives receivable

• variable lease payment that are based on an index or a rate

• amounts expected to be payable by the lessee under residual value guarantees

• the exercise price of a purchase option if the lessee is reasonably certain to exercise that option and

• payments of penalties for terminating the lease, if the lease term reflects the lessee exercising that option

Lease payments to be made under reasonably certain extension options are also included in the measurement of the liability.

The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be readily determined, the lessee’s incremental borrowing rate is used, being the rate that the individual lessee would have to pay to borrow the funds necessary to obtain an asset of similar value to the right-of-use asset in a similar economic environment with similar terms, security and conditions.

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Right-of-use assets are measured at cost comprising the following:

• the amount of the initial measurement of lease liability

• any lease payments made at or before the commencement date less any lease incentives received

• any initial direct costs, and

• restoration costs

Right-of-use assets are generally depreciated over the shorter of the asset’s useful life and the lease term on a straight-line basis. If we are reasonably certain to exercise a purchase option, the right-of-use asset is depreciated over the underlying asset’s useful life.

Payments associated with short-term leases and leases of low-value assets are recognized on a straight-line basis as an expense in profit or loss. Short-term leases are leases with a lease term of 12 months or less. Low-value assets comprise IT-equipment and small items of office furniture.

Investment properties

Investment properties, principally comprising buildings, are held for long-term rental and that are not occupied by us. Investment properties are initially measured at cost, including related transaction costs and where applicable borrowing costs. After initial recognition, investment properties are carried at fair value. Changes in fair values are recorded in profit or loss.

Intangible assets

Acquired computer software licenses are capitalized on the basis of the costs incurred to acquire and bring the specific software into usage. These costs are amortized using the straight-line method over their estimated useful lives of 5 years. Costs associated with maintaining computer software programs are recognized as expense as incurred.

Assets held for sale

Assets are classified as assets held for sale when their carrying amount is to be recovered principally through a sale transaction and a sale is considered highly probable. They are stated at the lower of carrying amount and fair value less costs to sell if their carrying amount is to be recovered principally through a sale transaction rather than through continuing use.

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Financial assets

Classification

We classify our financial assets in the following measurement categories:

• Those to be measured subsequently at fair value (either through other comprehensive income, or through profit or loss), and

• Those to be measured at amortized cost.

The classification depends on the entity’s business model for managing the financial assets and the contractual terms of the cash flows.

For financial assets measured at fair value, gains and losses will either be recorded in profit or loss or other comprehensive income. For investments in debt instruments, this will depend on the business model in which the investment is held. For investments in equity instruments that are not held for trading, this will depend on whether the Group has made an irrevocable election at the time of initial recognition to account for the equity investment at fair value through other comprehensive income.

See Note 23 to the Accountant’s Report in Appendix I to this document for details about each type of financial assets.

We reclassifies debt investments when and only when our business model for managing those assets changes.

Recognition and derecognition

Regular way purchases and sales of financial assets are recognized on trade-date, the date on which we commit to purchase or sell the asset. Financial assets are derecognized when the rights to receive cash flows from the financial assets have expired or have been transferred and we have transferred substantially all the risks and rewards of ownership.

Measurement

At initial recognition, we measure a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value through profit or loss are expensed in profit or loss.

Financial assets with embedded derivatives are considered in their entirety when determining whether their cash flows are solely payment of principal and interest.

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Impairment

We assess on a forward-looking basis the expected credit losses associated with its debt instruments carried at amortized cost and fair value through other comprehensive income. The impairment methodology applied depends on whether there has been a significant increase in credit risk.

For trade receivables, we apply the simplified approach permitted by HKFRS 9, which requires expected lifetime losses to be recognized from initial recognition of the receivables. We make allowances on receivables based on assumptions about risk of default and expected loss rates. We used judgement in making these assumptions and selecting the inputs to the impairment calculation, based on our past history, existing market conditions as well as forward looking estimates at the end of each reporting period.

Fair value of redeemable shares

Redeemable shares represent those ordinary shares with preference rights such as redemption rights and anti-dilution rights. We designated the redeemable shares as financial liabilities at fair value through profit or loss . They were initially recognized at fair value. Any directly attributable transaction costs were recognized as finance costs in profit or loss. Subsequent to initial recognition, the redeemable shares were measured at fair value with fair value changes being charged or credited to profit or loss. When the ordinary shares with preference rights were transferred to redeemable shares, the excess of the fair value of redeemable shares as at the date of such transfer over the nominal value of the ordinary share capital was debited to capital reserves. When the redeemable shares were transferred back to ordinary shares upon the termination of the preference rights, the excess of the fair value of redeemable shares as at the date of such transfer over the nominal value of the ordinary share capital was credited to capital reserves.

We used the discounted cash flow method to determine the underlying equity value of the Company and adopted a hybrid method, being a hybrid of scenario-based methods and the option pricing method to determine the fair value of the redeemable shares. Key assumptions include discount rate, discount for the lack of marketability, discount for the lack of control, risk-free interest rate and volatility. For details on the key assumptions in determining the fair value of the redeemable shares, see Note 34 to the Accountant’s Report in Appendix I to this document.

Current and deferred income tax

We are subject to corporate income taxes in the PRC. Judgment is required in determining the amount of the provision for taxation and the timing of payment of the related taxations. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the income tax and deferred income tax provisions in the period in which such determination is made.

Deferred income tax assets relating to certain temporary differences and tax losses are recognized when management considers to be probable that future taxable profit will be available against which the temporary differences or tax losses can be utilized. The outcome of their actual utilization may be different.

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DESCRIPTION OF CERTAIN CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

The following table sets forth a summary of our consolidated statements of comprehensive income for the years or periods indicated. Our historical results presented below are not necessarily indicative of the results that may be expected for any future period.

For the year ended For the three months December 31, ended March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Revenue 2,404,287 2,810,349 3,035,600 693,162 783,798 Cost of services (1,996,141) (2,295,646) (2,397,370) (556,081) (618,552)

Gross profit 408,146 514,703 638,230 137,081 165,246

Selling and marketing expenses (58,695) (83,406) (112,959) (18,656) (14,014) Administrative expenses (214,537) (228,001) (269,681) (44,591) (65,406) Net impairment losses on financial assets (35,411) (63,123) (23,694) (12,932) (15,084) Other income – net 12,820 27,019 49,721 321 3,819 Other gains – net 10,493 8,875 3,254 2,001 5,134

Operating profit 122,816 176,067 284,871 63,224 79,695

Finance income 4,646 5,856 4,384 1,358 983 Finance costs (14,560) (12,674) (12,021) (2,977) (2,757) Finance costs – net (9,914) (6,818) (7,637) (1,619) (1,774)

Fair value changes of redeemable shares (6,507) 7,103 338 4,262 – Share of net profits/(losses) of investments accounted for using the equity method 4,014 9,369 9,778 428 (1,095)

Profit before income tax 110,409 185,721 287,350 66,295 76,826 Income tax expense (39,037) (51,559) (80,784) (19,203) (26,855)

Profit for the year/period 71,372 134,162 206,566 47,092 49,971

Profit attributable to: − Owners of the Company 69,245 135,344 210,012 49,920 53,268 − Non-controlling interests 2,127 (1,182) (3,446) (2,828) (3,297)

71,372 134,162 206,566 47,092 49,971

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For the year ended For the three months December 31, ended March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited) Other comprehensive income Items that may be reclassified to profit or loss − Revaluation of properties 41,305 (4,200) (2,700) (900) – − Income tax relating to the item (10,326) 1,050 675 225 –

Other comprehensive income for the year/period, net of tax 30,979 (3,150) (2,025) (675) –

Total comprehensive income for the year/period 102,351 131,012 204,541 46,417 49,971

Total comprehensive income attributable to: − Owners of the Company 100,224 132,194 207,987 49,245 53,268 − Non-controlling interests 2,127 (1,182) (3,446) (2,828) (3,297)

102,351 131,012 204,541 46,417 49,971

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Revenue

During the Track Record Period, we derived our revenue primarily from the following four business lines:

• Property management services, which primarily comprise (i) cleaning services, (ii) security services, (iii) greening and landscaping services and (iv) repair and maintenance services to property developers, property owners and residents. Such business line contributed to 79.3%, 78.1%, 76.3%, 77.7% and 77.6% of our total revenue for the years ended December 31, 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, respectively. Our property management services are provided for residential and non-residential properties, and the latter primarily includes commercial and public properties.

• Value-added services to property developers, which primarily comprise sales office management services. Such business line contributed to 6.3%, 4.5%, 3.6%, 3.9% and 3.6% of our total revenue for the years ended December 31, 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, respectively. Our value-added services to property developers are primarily provided to property developers which require certain additional tailored services for their residential and/or non-residential properties;

• Community value-added services, which primarily comprise (i) space management services; (ii) community shopping services; (iii) home-living services; and (iv) car parks management services. Such business line contributed to 9.8%, 11.4%, 12.1%, 12.9% and 13.7% of our total revenue for the years ended December 31, 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, respectively. Our community value-added services are provided to property owners, residents, tenants and property developers; and

• Professional services, which primarily comprise (i) construction and installation engineering services; (ii) elevator related services; and (iii) smart integrated operation platform services. Such business line contributed to 4.6%, 6.0%, 8.0%, 5.5% and 5.1% of our total revenue for the years ended December 31, 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, respectively. Our professional services are provided to property developers, property owners, residents, tenants, property management companies, government agencies, transportation hubs and other companies.

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The following table sets forth the breakdown of our revenue by business line for the years or periods indicated:

For the year ended December 31, For the three months ended March 31, 2018 2019 2020 2020 2021 RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 % (Unaudited)

Total 2,404,287 100.0 2,810,349 100.0 3,035,600 100.0 693,162 100.0 783,798 100.0

Revenue from property management services

Revenue from our property management services, which primarily include cleaning services, security services, greening and landscaping services and repair and maintenance services, increased during the Track Record Period, primarily driven by the increase in our total GFA under management as a result of our business expansion through organic growth as well as acquisition. During the Track Record Period, we experienced a steady growth in our GFA under management, which was 84.4 million sq.m., 101.4 million sq.m., 109.4 million sq.m. and 114.6 million sq.m. as of December 31, 2018, 2019 and 2020 and March 31, 2021, respectively.

Property management fees may be charged on either a lump sum or a commission basis. The lump-sum fee model is the dominant method of collecting property management fees in China. It dispenses with certain collective decision-making procedures among property owners and residents for making large expenditures, which instead are required under the commission fee model. Another advantage of the lump-sum fee model is that it incentivizes property management companies to optimize their cost structure and streamline their business operations to enhance profitability, which is conducive to the development of the PRC property management industry as a whole. During the Track Record Period, we charged property management fees under the lump sum basis for a majority of the properties under our management. We expect property management fees charged on a lump sum basis to continue to account for a majority of our revenue from property management services in the foreseeable future.

– 253 – The following table sets forth a breakdown of our total GFA under management as of the dates indicated, and revenue from our THE THAT AND CHANGE THE TO ON “WARNING” SUBJECT HEADED SECTION AND THE INCOMPLETE WITH DOCUMENT. CONJUNCTION FORM, THIS IN OF DRAFT COVER READ BE IN MUST IS INFORMATION DOCUMENT THIS property management services for the years or periods indicated, by fee model:

As of or for the year ended December 31, As of or for the three months ended March 31, 2018 2019 2020 2020 2021 GFA under GFA under GFA under GFA under GFA under management Revenue management Revenue management Revenue management Revenue management Revenue sq.m. ’000 RMB ’000 % sq.m. ’000 RMB ’000 % sq.m. ’000 RMB ’000 % sq.m. ’000 RMB ’000 % sq.m. ’000 RMB ’000 % (Unaudited)

Total 84,442 1,905,789 100.0 101,369 2,196,176 100.0 109,429 2,315,359 100.0 INFORMATION 103,529FINANCIAL 538,546 100.0 114,606 608,096 100.0 5 – 254 – During the Track Record Period, a majority of our revenue from property management services was derived from residential THE THAT AND CHANGE THE TO ON “WARNING” SUBJECT HEADED SECTION AND THE INCOMPLETE WITH DOCUMENT. CONJUNCTION FORM, THIS IN OF DRAFT COVER READ BE IN MUST IS INFORMATION DOCUMENT THIS properties, which accounted for 65.3%, 66.3%, 64.9%, 67.7% and 65.0%, respectively, of our total revenue from property management services in 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021. Our percentage of revenue derived from managing residential properties remained generally stable during the Track Record Period.

As of or for the year ended December 31, As of or for the three months ended March 31, 2018 2019 2020 2020 2021 GFA Revenue GFA Revenue GFA Revenue GFA Revenue GFA Revenue sq.m. ’000 RMB ’000 % sq.m. ’000 RMB ’000 % sq.m. ’000 RMB ’000 % sq.m. ’000 RMB ’000 % sq.m. ’000 RMB ’000 % (Unaudited)

Residential properties 64,648 1,243,412 65.3 77,813 1,456,606 66.3 83,631 1,502,706 64.9 INFORMATION FINANCIAL 80,207 364,398 67.7 84,937 395,532 65.0 Non-residential properties 19,794 662,377 34.7 23,556 739,570 33.7 25,798 812,653 35.1 23,322 174,148 32.3 29,669 212,564 35.0 Commercial properties 15,872 587,251 30.8 14,989 634,482 28.9 19,324 686,572 29.7 16,497 141,681 26.3 20,400 176,741 29.1 Public properties 3,922 75,126 3.9 8,567 105,088 4.8 6,473 126,081 5.4 6,825 32,467 6.0 9,269 35,823 5.9

Total 84,442 1,905,789 100.0 101,369 2,196,176 100.0 109,429 2,315,359 100.0 103,529 538,546 100.0 114,606 608,096 100.0 5 – 255 – The following table sets forth a breakdown of our total GFA under management as of the dates indicated, and our revenue generated THE THAT AND CHANGE THE TO ON “WARNING” SUBJECT HEADED SECTION AND THE INCOMPLETE WITH DOCUMENT. CONJUNCTION FORM, THIS IN OF DRAFT COVER READ BE IN MUST IS INFORMATION DOCUMENT THIS from property management services for the periods indicated, by geographic region.

South China Region IACA INFORMATION FINANCIAL

5 – 256 – (5) 10,376 249,110 13.1 14,295 303,782 13.8 17,262 311,250 13.4 16,843 76,275 14.2 17,564 82,867 13.6 Bohai Region (6) 9,366 247,566 13.0 9,264 242,296 11.0 10,349 249,969 10.8 8,796 57,199 10.6 11,235 65,168 10.7

Total 84,442 1,905,789 100.0 101,369 2,196,176 100.0 109,429 2,315,359 100.0 103,529 538,546 100.0 114,606 608,096 100.0

Notes:

(1) Includes Guangdong Province, Guangxi Zhuang Autonomous Region, Fujian Province, Hunan Province, Hainan Province and Guizhou Province.

(2) Includes Beijing, Hebei Province and Ningxia Hui Autonomous Region.

(3) Includes Shanghai, Shandong Province, Anhui Province, Jiangsu Province and Zhejiang Province.

(4) Includes Hubei Province, Jiangxi Pronvince, Henan Province, Shanxi Province and Shaanxi Province.

(5) Includes Chongqing, Sichuan Province, Yunan Province, Qinghai Province, Gansu Province, Inner Mongolia Autonomous Region, Xinjiang Uygur Autonomous Region and Tibet Autonomous Region.

Revenue from value-added services to property developers

We provide value-added services to property developers, namely sales office management services. In 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, we generated RMB152.5 million, RMB123.2 million, RMB108.5 million, RMB27.3 million and RMB28.0 million, respectively, from sales office management services.

Revenue from community value-added services

For the year ended December 31, For the three months ended March 31, 2018 2019 2020 2020 2021 RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 %

Total 236,151 100.0 321,237 100.0 368,304 100.0 89,392 100.0 107,536 100.0

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Revenue from Professional services

We provide professional services to property developers, property owners, residents, tenants, property management companies, government agencies, transportation hubs and other companies, including (i) construction and installation engineering services; (ii) elevator related services; and (iii) smart integrated operation platform services. The following table sets forth a breakdown of our revenue from professional services for the years or periods indicated:

For the year ended December 31, For the three months ended March 31, 2018 2019 2020 2020 2021 RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 %

Construction and installation services 85,101 77.5 112,238 66.2 159,384 65.4 26,089 68.7 34,083 84.9 Elevator related services 24,710 22.5 41,487 24.4 51,314 21.1 7,347 19.4 4,918 12.2 Smart integrated operation platform services – – 16,038 9.4 32,766 13.5 4,528 11.9 1,151 2.9

Total 109,811 100.0 169,763 100.0 243,464 100.0 37,964 100.0 40,152 100.0

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Cost of Services

Our cost of services primarily consists of (i) employee benefits expenses; (ii) security expenses; (iii) cleaning expenses; (iv) utilities; (v) maintenance expenses; (vi) office expenses; (vii) greening and gardening expenses; (viii) depreciation and amortization expenses; (ix) travelling and entertainment expenses; (x) Short-term and low value lease expenses; (xi) taxes and surcharges; and (xii) others. The following table sets forth a breakdown of the components of our cost of services for the years or periods indicated:

For the year ended December 31, For the three months ended March 31, 2018 2019 2020 2020 2021 RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 % (Unaudited)

Employee benefits expenses 662,588 33.2 791,781 34.5 851,877 35.5 203,135 36.5 240,604 38.9 Security expenses 427,262 21.4 423,674 18.5 425,458 17.7 118,721 21.3 135,191 21.9 Cleaning expenses 300,832 15.1 374,614 16.3 404,414 16.9 89,218 16.0 78,768 12.7 Utilities 210,972 10.6 273,022 11.9 244,034 10.2 72,069 13.0 78,175 12.6 Maintenance expenses 204,089 10.2 205,239 8.9 214,529 8.9 32,196 5.8 42,594 6.9 Office expenses 93,030 4.7 106,173 4.6 113,451 4.7 13,444 2.4 17,257 2.8 Greening and gardening expenses 52,420 2.6 54,748 2.4 61,754 2.6 11,845 2.1 9,777 1.6 Depreciation and amortization expenses 11,139 0.6 19,038 0.8 30,814 1.3 8,229 1.5 7,503 1.2 Travelling and entertainment expenses 4,181 0.2 4,507 0.2 4,953 0.2 468 0.1 1,134 0.2 Short-term and low value lease expenses 7,382 0.4 12,201 0.5 13,730 0.6 3,013 0.5 2,724 0.4 Taxes and surcharges 12,683 0.6 12,166 0.5 16,374 0.7 2,201 0.4 2,578 0.4 Others 9,563 0.4 18,483 0.9 15,982 0.7 1,542 0.4 2,247 0.4

Total 1,996,141 100.0 2,295,646 100.0 2,397,370 100.0 556,081 100.0 618,552 100.0

During the Track Record Period, the main components of our cost of services was employee benefits expenses, security expenses, cleaning expenses, utilities costs and maintenance expenses. The increase in our cost of services during the Track Record Period was in line with our business expansion.

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The following table sets forth the breakdown of our cost of services by business line for the years or periods indicated:

For the year ended December 31, For the three months ended March 31, 2018 2019 2020 2020 2021 RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 % (Unaudited)

Property management services 1,594,372 79.9 1,827,187 79.6 1,875,337 78.2 450,855 81.1 498,067 80.5 Value-added services to property developers 126,896 6.4 105,789 4.6 92,803 3.9 22,598 4.1 24,966 4.0 Community value-added services 184,176 9.2 236,995 10.3 257,206 10.7 57,918 10.4 68,452 11.1 Professional services 90,697 4.5 125,675 5.5 172,024 7.2 24,710 4.4 27,067 4.4

Total 1,996,141 100.0 2,295,646 100.0 2,397,370 100.0 556,081 100.0 618,552 100.0

Gross Profit and Gross Profit Margin

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The following table sets forth our gross profit and gross profit margin by business line for the years or periods indicated:

Total 408,146 17.0 514,703 18.3 638,230 21.0 137,081 19.8 165,246 21.1

Property Management Services

Gross profit margin for our property management services is largely affected by the consolidated effect of the average fee per sq.m. per month we charge for our property management services and our cost of services per sq.m. per period for providing such services. The average property management fees that we charge for property management services remained generally stable at RMB1.9 per sq.m. per month, RMB1.8 per sq.m. per month, RMB1.8 per sq.m. per month, RMB1.7 per sq.m. per month and RMB1.8 per sq.m. per month in 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, respectively. Our gross profit margin for property management services remained stable at 16.3% in 2018 and 16.8% in 2019. Our gross profit margin for property management services increased from 16.8% in 2019 to 19.0% in 2020 primarily attributable to a reduction in social insurance costs due to the PRC government policy aimed at mitigating the impact of COVID-19 to businesses. Our gross profit margin for property management services increased from 16.3% in the three months ended March 31, 2020 to 18.1% in the three months ended March 31, 2021 primarily because our revenue in the three months ended March 31, 2020 was affected by the closure of certain commercial and public properties under our management as a result of the COVID-19 pandemic.

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The following table sets forth our gross profit and gross profit margin from property management services by property type for the years or periods indicated:

Total gross profit/overall gross profit margin 311,417 16.3 368,989 16.8 440,022 19.0 87,691 16.3 110,029 18.1

The table below sets forth the monthly average property management fees charged for projects under our management during the Track Record Period by property type:

For the three months For the year ended December 31, ended March 31, 2018 2019 2020 2020 2021 RMB per sq.m. per month

Residential properties 1.6 1.6 1.5 1.5 1.6 Non-residential properties 2.8 2.6 2.6 2.5 2.4 Commercial properties 3.1 3.5 3.0 2.9 2.9 Public properties(1) 1.6 1.0 1.6 1.6 1.3

Overall 1.9 1.8 1.8 1.7 1.8

Note:

(1) As the property management fees for certain public properties under our management were not charged on a per sq.m. basis, monthly average property management fees for public properties might not be indicative of our overall revenue or profit margin derived from the management of public properties.

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Value-added services to property developers

Gross profit margin for our value-added services to property developers was 16.8%, 14.1%, 14.4%, 17.1% and 10.9%, respectively, in 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021. Our gross profit margin for value-added services to property developers generally decreased during the Track Record Period due to increased market competition, which affected the pricing for such services. The overall trend was partially mitigated in 2020 as a result of the reduction in social insurance costs due to the PRC government policy aimed at mitigating the impact of COVID-19 to businesses.

Community value-added services

Professional services

Gross profit margin for our Professional services was 17.4%, 26.0%, 29.3%, 34.9% and 32.6%, respectively, in 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021. Our gross profit margin from professional services generally increased during the Track Record Period due to economies of scale as a result of our expansion.

Selling and Marketing Expenses

Our selling and marketing expenses primarily consist of employee benefits expenses, travelling and entertainment expenses and office expenses. In 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, we recorded selling and marketing expenses of RMB58.7 million, RMB83.4 million, RMB113.0 million, RMB18.7 million and RMB14.0 million, respectively.

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The table below sets forth a breakdown of our selling and marketing expenses for the years or periods indicated:

For the year ended December 31, For the three months ended March 31, 2018 2019 2020 2020 2021 RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 % (Unaudited)

Employee benefits expenses 36,061 61.4 54,587 65.4 78,850 69.8 16,133 86.5 11,754 83.9 Office expenses 4,638 7.9 3,890 4.7 5,984 5.3 78 0.4 115 0.8 Depreciation and amortization expenses 274 0.5 294 0.4 1,026 0.9 198 1.1 128 0.9 Travelling and entertainment expenses 13,424 22.9 15,931 19.1 13,486 12.0 969 5.2 1,045 7.5 Short-term and low value lease expenses 533 0.9 522 0.6 1,937 1.7 485 2.6 171 1.2 Professional service fees(1) 3,472 5.9 2,904 3.5 4,972 4.5 644 3.5 158 1.1 Others(2) 294 0.5 5,278 6.3 6,704 5.8 149 0.7 643 4.6

Total 58,695 100.0 83,406 100.0 112,959 100.0 18,656 100.0 14,014 100.0

Notes:

(1) Refer to service fees paid for sales and marketing related consultancy services.

(2) Primarily include tender and bidding related expenses.

Administrative Expenses

Our administrative expenses primarily consist of (i) employee benefits expenses; (ii) depreciation and amortization expenses; and (iii) travelling and entertainment expenses. In 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, we recorded administrative expenses of RMB214.5 million, RMB228.0 million, RMB269.7 million, RMB44.6 million and RMB65.4 million, respectively.

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The table below sets forth a breakdown of our administrative expenses for the years or periods indicated:

For the year ended December 31, For the three months ended March 31, 2018 2019 2020 2020 2021 RMB’000 % RMB’000 % RMB’000 % RMB’000 % RMB’000 % (Unaudited)

Employee benefits expenses 131,846 61.5 139,420 61.1 175,302 65.0 34,881 78.2 50,127 76.7 Office expenses 8,787 4.1 8,016 3.5 17,364 6.4 550 1.2 676 1.0 Depreciation and amortization expenses 35,465 16.5 31,952 14.0 24,765 9.2 5,322 11.9 5,709 8.7 Traveling and entertainment expenses 20,018 9.3 21,109 9.3 20,288 7.5 1,832 4.1 2,596 4.0 Short-term and low value lease expenses 331 0.2 2,348 1.0 1,453 0.5 279 0.6 749 1.1 Professional service fees(1) 7,894 3.7 4,541 2.0 11,010 4.1 160 0.4 1,172 1.8 Impairment losses on asset held for sale 1,892 0.9 8,419 3.8 1,812 0.7 − – 161 0.3 Others(2) 8,304 3.8 12,196 5.3 17,687 6.6 1,567 3.6 4,217 6.4

Total(2) 214,537 100.0 228,001 100.0 269,681 100.0 44,591 100.0 65,406 100.0

Notes:

(1) Refer to service fees paid to business management related consultancy services.

(2) Others primarily include bank charges and insurance expenses.

Net Impairment Losses on Financial Assets

Our net impairment losses on financial assets primarily consists of provisions for losses arising from potential bad debts in respect of our trade receivables and other receivables and payments on behalf of residents in the ordinary course of business. In 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, we recorded net impairment losses on financial assets of RMB35.4 million, RMB63.1 million, RMB23.7 million, RMB12.9 million and RMB15.1 million, respectively. See “Risk Factors—Risks Relating to Our Business and Industry—We may not be able to collect property management fees from property owners,residents and/or property developers which could incur impairment losses on our trade receivables” for further discussion.

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Other Income – Net

Our other income and expenses primarily consist of (i) super deduction of value-added tax, (ii) government grants, (iii) rental income from our investment properties, including office and retail properties, and (iv) others, including non-recurring losses such as administrative fines and penalties. In 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, we recorded other income of RMB12.8 million, RMB27.0 million, RMB49.7 million, RMB0.3 million and RMB3.8 million, respectively. The following table sets forth a breakdown of our other income for the years or periods indicated:

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Super deduction of value-added tax – 12,446 15,300 1,205 2,001 Government grants 7,134 3,633 30,207 1,138 358 Rental income from operating leases 8,487 10,097 10,871 1,290 1,924 Others (2,801) 843 (6,657) (3,312) (464)

12,820 27,019 49,721 321 3,819

Other Gains – Net

Our other gains primarily consists of net gains/(losses) on disposal of property, plant and equipment, intangible assets and investment properties, fair value gains on investment properties and unrealized fair value gains on financial assets at fair value through profit or loss. In 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, we recorded other gains of RMB10.5 million, RMB8.9 million, RMB3.3 million, RMB2.0 million and RMB5.1 million, respectively.

Finance Costs – Net

Our net finance costs mainly include interest expenses on lease liabilities and bank borrowings, offset by interest income from bank deposits, wealth management products and finance lease receivables. In 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, our net finance costs amounted to RMB9.9 million, RMB6.8 million, RMB7.6 million, RMB1.6 million and RMB1.8 million, respectively.

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The following table sets forth a breakdown of our net finance costs for the years or periods indicated:

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Finance income: Interest income from bank deposits 1,545 1,596 1,540 571 290 Interest income from wealth management products 1,788 3,085 1,823 532 481 Interest income from finance lease receivables 1,313 1,175 1,021 255 212

4,646 5,856 4,384 1,358 983

Finance costs: Interest expenses on lease liabilities (5,454) (4,587) (3,984) (1,068) (844) Interest expenses on bank borrowings (9,106) (8,087) (8,037) (1,909) (1,913)

(14,560) (12,674) (12,021) (2,977) (2,757)

Finance costs – net (9,914) (6,818) (7,637) (1,619) (1,774)

Fair Value Changes of Redeemable Shares

We recorded fair value loss of redeemable shares in the amount of RMB6.5 million in 2018 and fair value gain in the amount of RMB7.1 million, RMB0.3 million and RMB4.3 million in 2019, 2020 and for the three months ended March 31, 2020, respectively, reflecting the change in fair value of certain shares we issued to third-party investors embedded with preference rights. These preference rights had been terminated in July 2020 and no change in the fair value of redeemable shares were recorded for the three months ended March 31, 2021. See Note 34 in Appendix I for details.

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Share of Net Profits/(losses) of Investments Accounted for Using the Equity Method

We recorded share of profits of investments of RMB4.0 million, RMB9.4 million, RMB9.8 million and RMB0.4 million in 2018, 2019 and 2020 and the three months ended March 31, 2020, respectively, and a loss of RMB1.1 million in the three months ended March 31, 2021, which primarily accounted for using the equity method represents the profits or losses we shared from our subsidiaries and our investment in Suzhou Industrial Park Shengcheng Property Management Co., Ltd. (蘇州工業園區勝城物業管理有限公司), Zhuzhou Xinyuancheng Property Service Co., Ltd. (株洲市新遠城物業服務有限公司) and Ningxia Construction Investment Changcheng Property Management Co., Ltd. (寧夏建投長城物業管理有限公司) during the Track Record Period.

Income Tax Expense

Income tax expenses consist of current and deferred income tax payable in the PRC by our Company and our subsidiaries.

The following table sets forth a breakdown of the income tax expenses for the years or periods indicated:

For the three months For the year ended December 31, ended March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Current income tax 46,178 65,927 86,696 25,460 34,564 Deferred income tax (7,141) (14,368) (5,912) (6,257) (7,709)

Total 39,037 51,559 80,784 19,203 26,855

In 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, our effective income tax rates, calculated as income tax expenses divided by profit before tax, were approximately 35.4%, 27.8%, 28.1%, 29.0% and 35.0%, respectively, which were higher than the PRC statutory corporate income tax rate of 25% primarily due to certain tax losses not recognized and certain expenses not deductible for taxation purposes. During the Track Record Period and up to the Latest Practicable Date, we had paid all applicable taxes when due and were not subject to any investigation or inquiry by the relevant tax authorities and there were no matters in dispute or unresolved with any tax authorities.

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RESULTS OF OPERATIONS

Three Months Ended March 31, 2021 Compared to Three Months Ended March 31, 2020

Revenue

Our total revenue increased by 13.1% to RMB783.8 million in the three months ended March 31, 2021 from RMB693.2 million in the three months ended March 31, 2020, primarily due to our overall business expansion.

• Property management services. Our revenue from property management services increased by 12.9% to RMB608.1 million in the three months ended March 31, 2021 from RMB538.5 million in the three months ended March 31, 2020, primarily because of (i) an increase in GFA under management of residential properties to 84.9 million sq.m. as of March 31, 2021 from 80.2 million sq.m. as of March 31, 2020; and (ii) an increase in GFA under management of non-residential properties to 29.7 million sq.m. as of March 31, 2021 from 23.3 million sq.m. as of March 31, 2020.

• Value-added services to property developers. Our revenue from value-added services to property developers increased by 2.6% to RMB28.0 million in the three months ended March 31, 2021 from RMB27.3 million in the three months ended March 31, 2020, primarily because of certain of our sales offices under management were closed during the three months ended March 31, 2020 due to the impact of COVID-19 pandemic.

• Community value-added services. Our revenue from community value-added services increased by 20.2% to RMB107.5 million in the three months ended March 31, 2021 from RMB89.4 million in the three months ended March 31, 2020, primarily increase in the number of communities under our management and number of customers we provided services to as a result of our business expansion.

• Professional services. Our revenue from professional services increased by 5.8% to RMB40.2 million in the three months ended March 31, 2021 from RMB38.0 million in the three months ended March 31, 2020, primarily due to our business expansion.

Cost of services

Our total cost of services increased by 11.2% to RMB618.6 million in the three months ended March 31, 2021 from RMB556.1 million in the three months ended March 31, 2020, primarily due to the increases in our employee benefits expenses and security expenses, which were in line with our business expansion.

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Gross profit and gross profit margin

As a result of the foregoing, our total gross profit increased by 20.5% to RMB165.2 million in the three months ended March 31, 2021 from RMB137.1 million in the three months ended March 31, 2020, primarily attributable to our business expansion. Our gross profit margin increased to 21.1% in the three months ended March 31, 2021 from 19.8% in the three months ended March 31, 2020, primarily reflecting economies of scale as a result of our expansion.

• Property management services. Our gross profit for property management services increased by 25.4% to RMB110.0 million in the three months ended March 31, 2021 from RMB87.7 million in the three months ended March 31, 2020. Gross profit margin for property management services improved to 18.1% in the three months ended March 31, 2021 from 16.3% in the three months ended March 31, 2020, primarily due to the recovery of property management services we provided to non-residential properties from the COVID-19 pandemic in 2021 and economies of scale as a result of our expansion, partially offset by the expiration of the social insurance costs reduction policies promulgated in 2020 to mitigate the impact of COVID-19 to businesses.

• Value-added services to property developers. Our gross profit for value-added services to property developers decreased by 36.2% to RMB3.0 million in the three months ended March 31, 2021 from RMB4.7 million in the three months ended March 31, 2020. Gross profit margin for value-added services to property developers decreased to 10.9% in the three months ended March 31, 2021 from 17.1% in the three months ended March 31, 2020, primarily due to increased market competition that affected our pricing for such services.

• Community value-added services. Our gross profit for community value-added services increased by 24.1% to RMB39.1 million in the three months ended March 31, 2021 from RMB31.5 million in the three months ended March 31, 2020, with gross profit margin for community value-added services increasing to 36.3% in the three months ended March 31, 2021 from 35.2% in the three months ended March 31, 2020, primarily due to economies of scale.

• Professional services. Our gross profit for professional services decreased by 1.3% to RMB13.1 million in the three months ended March 31, 2021 from RMB13.3 million in the three months ended March 31, 2020, with gross profit margin for Professional services decreasing to 32.6% in the three months ended March 31, 2021 from 34.9% in the three months ended March 31, 2020, primarily due to the timing of delivery of certain of our construction and installation engineering services and smart integrated operation platform services, which affected our revenue growth, while our cost of services grew at a faster pace.

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Selling and marketing expenses

Our selling and marketing expenses decreased by 25.1% to RMB14.0 million in the three months ended March 31, 2021 from RMB18.7 million in the three months ended March 31, 2020, primarily due to the rearrangement of sales personnel, which led to the reclassification of some of the personnel’s employee benefits expenses as cost of services, and a change in overall salary structure as new employees who joined the Group in general had lower wage levels than the employees who left the Group during the same period.

Administrative expenses

Our administrative expenses increased by 46.6% to RMB65.4 million in the three months ended March 31, 2021 from RMB44.6 million in the three months ended March 31, 2020, primarily due to an increase in administrative personnel due to the centralization of certain administrative functions from project level to our headquarters, an increase in the number of supporting staff to assist with our community programs, and an increase in others as a result of additional bank charges we incurred in connection with the [REDACTED].

Net impairment losses on financial assets

Our net impairment losses on financial assets increased by 17.1% to RMB15.1 million in the three months ended March 31, 2021 from RMB12.9 million in the three months ended March 31, 2020, primarily due to the increases in allowance for impairment of trade and other receivables.

Other income – net

Our net other income increased by 1,166.7% to RMB3.8 million in the three months ended March 31, 2021 from RMB0.3 million in the three months ended March 31, 2020, primarily due to an increase in super deduction of value-added tax in line with our business expansion, and an increase in rental income from operating leases.

Other gains – net

Our net other gains increased by 155.0% to RMB5.1 million in the three months ended March 31, 2021 from RMB2.0 million the three months ended March 31, 2020, primarily due to an increase in gains on disposal of property, plant and equipment, intangible assets and investment properties.

Finance costs – net

Our net finance costs remained stable at RMB1.8 million in three months ended March 31, 2021 and at RMB1.6 million in three months ended March 31, 2020.

Income tax expense

Our income tax expense increased by 40.1% to RMB26.9 million in the three months ended March 31, 2021 from RMB19.2 million in the three months ended March 31, 2020, primarily due to an increase in our profit before tax.

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Profit for the period

As a result of the foregoing, our profit for the period increased by 6.2% to RMB50.0 million in the three months ended March 31, 2021 from RMB47.1 million in the three months ended March 31, 2020.

Year Ended December 31, 2020 Compared to Year Ended December 31, 2019

Revenue

Our total revenue increased by 8.0% to RMB3,035.6 million in 2020 from RMB2,810.3 million in 2019, primarily due to our overall business expansion.

• Property management services. Our revenue from property management services increased by 5.4% to RMB2,315.4 million in 2020 from RMB2,196.2 million in 2019, primarily due to (i) an increase in GFA under management of residential properties to 83.6 million sq.m. as of December 31, 2020 from 77.8 million sq.m. as of December 31, 2019; and (ii) an increase in GFA under management of non-residential properties to 25.8 million sq.m. as of December 31, 2020 from 23.6 million sq.m. as of December 31, 2019.

• Value-added services to property developers. Our revenue from value-added services to property developers decreased by 11.9% to RMB108.5 million in 2020 from RMB123.2 million in 2019, primarily as a result of decrease in the number of property developers’ sales offices under management and increased market competition which affected our pricing for such services and the temporary closure of certain of our sales offices under management due to the COVID-19 pandemic in 2020.

• Community value-added services. Our revenue from community value-added services increased by 14.7% to RMB368.3 million in 2020 from RMB321.2 million in 2019, primarily due to increase in the number of communities under our management and number of customers we provided services to as a result of our business expansion.

• Professional services. Our revenue from professional services increased by 43.4% to RMB243.4 million in 2020 from RMB169.7 million in 2019, primarily due to our business expansion.

Cost of services

Our total cost of services increased by 4.4% to RMB2,397.4 million in 2020 from RMB2,295.6 million in 2019, primarily due to increases in our employee benefits expenses and cleaning expenses as a result of our business expansion, partially offset by the reduction in social insurance costs due to the PRC government policy aimed at mitigating the impact of COVID-19 to businesses.

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Gross profit and gross profit margin

As a result of the foregoing, our total gross profit increased by 24.0% to RMB638.2 million in 2020 from RMB514.7 million in 2019, primarily due to our continued business expansion. Our gross profit margin increased to 21.0% in 2020 from 18.3% in 2019, primarily reflecting the reduction in social insurance costs due to the PRC government policy aimed at mitigating the impact of COVID-19 to businesses and economies of scale as a result of our business expansion.

• Property management services. Our gross profit for property management services increased by 19.3% to RMB440.0 million in 2020 from RMB369.0 million in 2019. Gross profit margin for property management services improved to 19.0% in 2020 from 16.8% in 2019, primarily due to the reduction in social insurance costs due to the PRC government policy aimed at mitigating the impact of COVID-19 to businesses and economies of scale as a result of our business expansion.

• Value-added services to property developers. Our gross profit for value-added services to property developers decreased by 9.8% to RMB15.7 million in 2020 from RMB17.4 million in 2019. Gross profit margin for Value-added services to property developers increased to 14.4% in 2020 from 14.1% in 2019, primarily due to the reduction in social insurance costs due to the PRC government policy aimed at mitigating the impact of COVID-19 to businesses, partially offset by increased market competition that affected our pricing for such services.

• Community value-added services. Our gross profit for community value-added services increased by 31.9% to RMB111.1 million in 2020 from RMB84.2 million in 2019, with gross profit margin for community value-added services increasing from 26.2% in 2019 to 30.2% in 2020, primarily due to the reduction in social insurance costs due to the PRC government policy aimed at mitigating the impact of COVID-19 to businesses and economies of scale as a result of our business expansion.

• Professional services. Our gross profit for professional services increased by 62.0% to RMB71.4 million in 2020 from RMB44.1 million in 2019. Gross profit margin for Professional services increased to 29.3% in 2020 from 26.0% in 2019, primarily due to the reduction in social insurance costs due to the PRC government policy aimed at mitigating the impact of COVID-19 to businesses and economies of scale as a result of our business expansion.

Selling and marketing expenses

Our selling and marketing expenses increased by 35.5% to RMB113.0 million in 2020 from RMB83.4 million in 2019, primarily due to an increase in employee benefits expenses as we expanded our sales and marketing team to enhance our business development efforts.

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Administrative expenses

Our administrative expenses increased by 18.3% to RMB269.7 million in 2020 from RMB228.0 million in 2019, primarily due to (i) an increase in employee benefits expenses as we hired additional administrative staff to support our business expansion; (ii) an increase in office expenses as a result of our business expansion; (iii) an increase in professional service fees; and (iv) an increase in others as a result of our purchase of additional insurance.

Net impairment losses on financial assets

Our net impairment losses of financial assets decreased 62.4% to RMB23.7 million in 2020 from RMB63.1 million in 2019, primarily due to (i) a relatively small increase in loss allowance for trade receivables; and (ii) a net decreased in loss allowance for payments on behalf of residents due to the settlement of certain outstanding balances.

Other income – net

Our other income increased by 84.1% to RMB49.7 million in 2020 from RMB27.0 million in 2019, primarily due to increase in government grants received in relation to the local business or investment attraction, and allowance from local government for general business support.

Other gains – net

We recorded net other gains of RMB8.9 million and RMB3.3 million in 2019 and 2020, respectively, primarily reflecting fair value gains on investment properties. Partially offset by non-recurring losses during the ordinary course of our business.

Finance costs – net

Our net finance costs increased by 11.8% to RMB7.6 million in 2020 from RMB6.8 million in 2019, primarily due to (i) an increase in interest expenses on bank borrowings and (ii) a decrease in Interest income from wealth management products, partially offset by (i) an increase in interest income from bank deposits and (ii) a decrease in interest expenses on lease liabilities, as a result of our fluctuating bank balances, amount of bank borrowings, amount of lease liabilities and amount and performance of our wealth management products.

Income tax expense

Our income tax expense increased by 56.6% to RMB80.8 million in 2020 from RMB51.6 million for 2019, primarily due to our increased profit before tax.

Profit for the year

As a result of the foregoing, our profit for the year increased by 53.9% to RMB206.6 million in 2020 from RMB134.2 million in 2019.

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Year Ended December 31, 2019 Compared to Year Ended December 31, 2018

Revenue

Our total revenue increased by 16.9% to RMB2,810.3 million in 2019 from RMB2,404.3 million in 2018, primarily due to our overall business expansion.

• Property management services. Our revenue from property management services increased by 15.2% to RMB2,196.2 million in 2019 from RMB1,905.8 million in 2018, primarily due to (i) an increase in GFA under management of residential properties to 77.8 million sq.m. as of December 31, 2019 from 64.6 million sq.m. as of December 31, 2018; and (ii) an increase in GFA under management of non-residential properties to 23.6 million sq.m. as of December 31, 2019 from 19.8 million sq.m. as of December 31, 2018.

• Value-added services to property developers. Our revenue from value-added services to property developers decreased by 19.2% to RMB123.2 million in 2019 from RMB152.5 million in 2018, primarily because of increased market competition that affected our pricing for such services.

• Community value-added services. Our revenue from community value-added services increased by 36.0% to RMB321.2 million in 2019 from RMB236.2 million in 2018, primarily due to increase in the number of communities under our management and number of customers we provided services to as a result of our business expansion.

• Professional services. Our revenue from professional services increased by 54.6% to RMB169.7 million in 2019 from RMB109.8 million in 2018, primarily due to our business expansion.

Cost of services

Our total cost of services increased by 15.0% to RMB2,295.6 million in 2019 from RMB1,996.1 million in 2018, primarily due to increases in our employee benefits expenses, cleaning expenses and utilities as a result of our business expansion.

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Gross profit and gross profit margin

As a result of the foregoing, our total gross profit increased by 26.1% to RMB514.7 million in 2019 from RMB408.1 million in 2018, primarily due to our continued business expansion. Our gross profit margin increased to 18.3% in 2019 from 17.0% in 2018, primarily reflecting increased gross profit margin from our community value-added services and professional service.

• Property management services. Our gross profit for property management services increased by 18.5% to RMB369.0 million in 2019 from RMB311.4 million in 2018. Gross profit margin for property management services improved to 16.8% in 2019 from 16.3% in 2018, primarily due to economies of scale as a result of our business expansion.

• Value-added services to property developers. Our gross profit for value-added services to property developers decreased by 47.1% to RMB17.4 million in 2019 from RMB25.6 million in 2018. Gross profit margin for value-added services to property developers decreased to 14.1% in 2019 from 16.8% in 2018, primarily due to increased market competition that affected our pricing for such services.

• Community value-added services. Our gross profit for community value-added services increased by 61.9% to RMB84.2 million in 2019 from RMB52.0 million in 2018, with gross profit margin for community value-added services increasing from 22.0% in 2018 to 26.2% in 2019, primarily due to (i) the increase of space management services, community shopping services and home-living services, which in general had high gross profit margin, as a percentage of our overall revenue; and (ii) economies of scale due to the expansion of our car parks management services.

• Professional services. Our gross profit for professional services increased by 130.7% to RMB44.1 million in 2019 from RMB19.1 million in 2018. Gross profit margin for Professional services increased to 26.0% in 2019 from 17.4% in 2018, primarily due to economies of scales as a result of our business expansion.

Selling and marketing expenses

Our selling and marketing expenses increased by 42.1% to RMB83.4 million in 2019 from RMB58.7 million in 2018, primarily due to an increase in employee benefits expenses as we expanded our sales and marketing team to support our business expansion.

Administrative expenses

Our administrative expenses increased by 6.3% to RMB228.0 million in 2019 from RMB214.5 million in 2018, primarily due to an increase in employee benefits expenses as we hired additional administrative staff to support our business expansion.

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Net impairment losses on financial assets

Our net impairment losses of financial assets increased 78.2% to RMB63.1 million in 2019 from RMB35.4 million in 2018, primarily due to an increase in loss allowance made for trade receivables.

Other income – net

Our net other income increased by 110.9% to RMB27.0 million in 2019 from RMB12.8 million in 2018, primarily due to the promulgation of the Relevant Taxation Policies of Deepen Reforms of Value-added Tax (No.39 in the year of 2019) (財政部稅務總局海關總署公告2019年第39號《關於深化增值稅改革有關政策的公告》) in March 2019, which allowed a 10% super deduction of the deductible value-added tax for consumer-oriented service industry. We were entitled to such super deduction subsidy as our primary business was the provision of property management services to the residents and was qualified as a tax payer in the consumer-oriented service industry.

Other gains – net

Our net other gains amounted to RMB8.9 million in 2019 and RMB10.5 million in 2018, primarily reflecting fair value gains on investment properties, partially offset by non-recurring losses during the ordinary course of our business.

Finance costs – net

Our net finance costs decreased by 31.3% to RMB6.8 million in 2019 from RMB9.9 million in 2018, primarily due to (i) an increase in interest income from bank deposits; (ii) an increase in Interest income from wealth management products; (iii) a decrease in interest expenses on bank borrowings; and (iv) a decrease in interest expenses on lease liabilities, as a result of our fluctuating bank balances, amount of bank borrowings, amount of lease liabilities and amount and performance of our wealth management products.

Income tax expense

Our income tax expense increased by 32.3% to RMB51.6 million in 2019 from RMB39.0 million for 2018, primarily due to our increased profit before tax.

Profit for the year

As a result of the foregoing, our profit for the year increased by 88.0% to RMB134.2 million in 2019 from RMB71.4 million in 2018.

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DESCRIPTION OF SELECTED ITEMS OF CONSOLIDATED BALANCE SHEETS

The following table sets forth a summary of our consolidated balance sheets as of the dates indicated:

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Non-current assets Property, plant and equipment 116,955 141,975 158,626 144,216 Right-of-use assets 71,983 66,864 74,098 69,562 Investment properties 284,366 294,872 295,208 296,032 Prepayments 8,992 14,131 3,452 4,512 Intangible assets 20,654 20,327 20,903 18,833 Investments accounted for using the equity method 8,794 21,867 32,112 33,573 Deferred income tax assets 39,042 55,448 61,969 69,716 Finance lease receivables 15,750 13,225 10,515 12,685

566,536 628,709 656,883 649,129

Current assets Inventories – 1,847 2,788 5,583 Trade and other receivables 676,147 748,137 883,730 1,086,578 Finance lease receivables 3,375 3,476 3,501 610 Prepayments 113,668 93,371 114,609 [REDACTED] Financial assets at fair value through profit or loss 48,509 17,575 46,789 61,817 Payments on behalf of residents 79,138 61,694 60,000 63,182 Restricted bank deposits 5,859 6,799 9,912 8,539 Cash and cash equivalents 530,299 523,733 514,213 366,363 Assets held for sale 77,062 150,875 145,548 144,412

1,534,057 1,607,507 1,781,090 [REDACTED]

Total assets 2,100,593 2,236,216 2,437,973 [REDACTED]

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As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Non-current liabilities Borrowings 38,566 33,766 16,766 12,516 Lease liabilities 65,442 46,096 44,448 39,214 Deferred income tax liabilities 12,506 13,494 13,428 13,466

116,514 93,356 74,642 65,196

Current liabilities Trade and other payables 983,070 1,022,497 1,067,253 1,227,201 Receipts on behalf of residents 145,949 127,178 142,120 151,921 Contract liabilities 162,479 209,651 205,055 157,914 Current income tax liabilities 35,809 46,684 45,154 73,042 Redeemable shares 569,358 562,255 – – Borrowings 127,850 124,800 137,000 137,000 Lease liabilities 30,050 33,240 34,803 35,736

2,054,565 2,126,305 1,631,385 1,782,814

Total liabilities 2,171,079 2,219,661 1,706,027 1,848,010

Equity attributable to owners of the Company Share capital 68,223 68,223 81,544 81,544 Other reserves (416,010) (410,822) 146,507 43,049 Retained earnings 267,134 347,462 494,290 541,760

(80,653) 4,863 722,341 666,353

Non-controlling interests 10,167 11,692 9,605 6,308

Total equity (70,486) 16,555 731,946 672,661

Total equity and liabilities 2,100,593 2,236,216 2,437,973 2,520,671

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Property, Plant and Equipment

We recorded property, plant and equipment in the amount of RMB117.0 million, RMB142.0 million, RMB158.6 million and RMB144.2 million as of December 31, 2018, 2019 and 2020 and March 31, 2021, respectively, which primarily consists of buildings, machinery, motor vehicles, leasehold improvement, electronic equipment and construction in progress. Our property, plant and equipment increased from December 31, 2018 to December 31, 2020 primarily due to additions in buildings, leasehold improvements and electronic equipment for our business operation and expansion. Our property, plant and equipment decreased from December 31, 2020 to March 31, 2021 primarily as a result of our disposal of certain buildings.

Right-of-use Assets

We recorded right-of-use assets, consisting of carrying amount of our lease liabilities with lease terms longer than one year, in the amount RMB72.0 million, RMB66.9 million, RMB74.1 million and RMB69.6 million as of December 31, 2018, 2019 and 2020 and March 31, 2021, respectively, which primarily reflects the fluctuating carrying amount of our leases with terms longer than one year at different points of time.

Investment Properties

We recorded investment properties in the amount of RMB284.4 million, RMB294.9 million, RMB295.2 million and RMB296.0 million as of December 31, 2018, 2019 and 2020 and March 31, 2021, respectively, which primarily consists of properties we held for rental purposes. The amount of our investment properties remained generally stable during the Track Record Period.

Intangible Assets

Our intangible assets consist of computer software. Our intangible assets remained relatively stable at RMB20.7 million, RMB20.3 million, RMB20.9 million and RMB18.8 million as of December 31, 2018, 2019, 2020 and March 31, 2021, respectively.

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Prepayments

The table below sets forth the breakdown of our prepayments as of the dates indicated:

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Included in current assests: Prepayments to suppliers 109,668 85,182 105,896 120,240 Prepayments for [REDACTED] expenses – – – [REDACTED] Prepaid taxes 4,000 8,189 8,713 6,836

113,668 93,371 114,609 [REDACTED]

Included in non-current assests: Prepayments for property, plant and equipment 5,342 4,268 1,713 440 Prepayments for intangible assets 3,650 9,863 1,739 4,072

8,992 14,131 3,452 4,512

Our prepayments included in current assets primarily comprise prepayments in relation to prepayments to suppliers for materials and services. Our prepayments included in non-current assets mainly represent prepayments for property, plant and equipment and computer software purchases. Our prepayments increased from 2018 to 2019, primarily due to an increase in prepayments we made for the purchase of certain softwares recorded as intangible assets. Our prepayments decreased from December 31, 2019 to December 31, 2020 as some of the softwares and property, plant and equipment we prepaid were delivered to us. Our prepayment increased from December 31, 2020 to March 31, 2021 primarily due to prepayments for [REDACTED] expenses made in relation to the [REDACTED].

Deferred Income Tax Assets

We recorded deferred income tax assets in the amount of RMB39.0 million, RMB55.4 million, RMB62.0 million and RMB69.7 million as of December 31, 2018, 2019 and 2020 and March 31, 2021, respectively. Such increases were primarily due to allowance made for impairment of receivables and assets held for sale during the respective year or period, which mainly comprised impairment of receivables and assets held for sale.

Inventories

We recorded inventories in the amount of nil, RMB1.8 million, RMB2.8 million and RMB5.6 million as of December 31, 2018, 2019 and 2020 and March 31, 2021, respectively, which primarily consisted of consumables we used in providing our services.

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Trade and Other Receivables

The table below sets forth a breakdown of the trade and other receivables as of the dates indicated:

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Trade receivables – Related parties 2,380 2,735 6,930 8,794 – Third parties 734,622 808,892 876,083 1,074,566 737,002 811,627 883,013 1,083,360

Less: allowance for impairment of trade receivables (122,251) (180,537) (192,800) (206,137)

614,751 631,090 690,213 877,223

Other receivables – Payments made on behalf of customers 32,277 81,797 130,242 143,873 – Deposits 25,794 35,996 50,918 52,801 – Amounts due from related parties 20,324 15,235 39,985 42,608 – Notes receivable 1,000 3,500 1,500 1,500 Less: allowance for impairment of other receivables (17,999) (19,481) (29,128) (31,427)

61,396 117,047 193,517 209,355

676,147 748,137 883,730 1,086,578

Trade receivables are amounts due from customers for services provided in the ordinary course of business. Trade receivables mainly arise from property management and value-added services provided to property developers, property owners, residents and other customers. We charge service fees in accordance with the relevant service agreements, which is due for payment by the property owners upon our rendering of services. Our trade receivables increased during the Track Record Period, which was in line with our business expansion.

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Our other receivables mainly arise from (i) payments made on behalf of customers, and (ii) deposits and payments made on behalf of property owners and residents of the property projects under our management, mainly in relation to utility fees. Our other receivables increased during the Track Record Period primarily due to the increases in deposits and payments made on behalf of third party business partners, customers and related parties in connection with our business expansion.

See “Related Party Transactions” below for more details on amounts due from related parties, including aging analysis and turnover days of trade receivables from related parties.

The following table sets forth our trade receivable turnover days for the years or periods indicated:

For the three months ended For the year ended December 31, March 31, 2018 2019 2020 2021 Day Day Day Day

Average trade receivable turnover days(1) 83 81 79 90

Note:

(1) Average trade receivable turnover days for a certain year equals average trade receivable divided by revenue for the year and then multiplied 365 for one-year period and 90 for three months. Average trade receivable is calculated as trade receivable as of the beginning of the year plus trade receivable as of the end of the year, divided by two.

Average trade receivable turnover days indicate the average time required for us to collect cash payments from provision of services. Our average turnover days of trade receivables had remained relatively stable during the Track Record Period, except for the three months ended March 31, 2021, primarily due to seasonality effect as we generally collect a large percentage of our trade receivables towards the end of the year.

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The following table sets forth an aging analysis of the trade receivables as of the dates indicated, based on the invoice date and net of allowance for impairment:

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Up to 1 year 377,091 405,425 383,641 577,587 1 to 2 years 160,209 159,005 236,723 213,541 2 to 3 years 82,283 93,607 93,250 120,130 3 to 4 years 52,898 61,475 59,784 51,015 4 to 5 years 35,100 41,878 38,671 48,337 Over 5 years 29,421 50,237 70,944 72,750

737,002 811,627 883,013 1,083,360

As of May 31, 2021, RMB311.1 million, or 28.7% of our trade receivables as of March 31, 2021, were subsequently settled.

Financial Assets at Fair Value through Profit or Loss

We recorded financial assets at fair value through profit or loss in the amount of RMB48.5 million, RMB17.6 million, RMB46.8 million and RMB61.8 million as of December 31, 2018, 2019 and 2020 and March 31, 2021, respectively, in connection with the changes in fair value of certain wealth management products we held. See Note 22 to the Accountant’s Report in Appendix I to this document for details.

Assets Held for Sale

We recorded assets held for sale in the amount of RMB77.1 million, RMB150.9 million, RMB145.5 million and RMB144.4 million as of December 31, 2018, 2019 and 2020 and March 31, 2021, respectively. Our assets held for sale consisted of properties received from certain property developer customers in exchange for property management service fees payable to us. Our intention is to sell these properties to settle the outstanding trade receivables, and accordingly, these properties are classified as assets held for sale if the related properties are ready to be sold. Our assets held for sale increased from RMB77.1 million as of December 31, 2018 to RMB150.9 million as of December 31, 2019 primarily as a result of certain property developer customers who provided us certain properties to settle property management service fees. Our assets held for sale remained stable as of December 31, 2019 and 2020 and March 31, 2021. See Note 28 to the Accountant’s Report in Appendix I to this document for details.

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Cash and Cash Equivalents

We recorded cash and cash equivalents in the amount of RMB530.3 million, RMB523.7 million, RMB514.2 million and RMB366.4 million as of December 31, 2018, 2019 and 2020 and March 31, 2021, respectively.

The following table sets forth the movements of cash and cash equivalents and restricted bank deposits as of the dates indicated:

As of As of December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Cash at banks and on hand 536,158 530,532 524,125 374,902 Less: Restricted bank deposits (5,859) (6,799) (9,912) (8,539)

Cash and cash equivalents 530,299 523,733 514,213 366,363

Deferred Income Tax Liabilities

We recorded deferred income tax liabilities in the amount of RMB12.5 million, RMB13.5 million, RMB13.4 million and RMB13.5 million as of December 31, 2018, 2019 and 2020 and March 31, 2021, respectively.

Trade and Other Payables

Our trade payables primarily represent our obligations to pay for goods and services that have been acquired in the ordinary course of business from suppliers, including purchases of materials and utilities and purchases from subcontractors. We are typically granted credit terms ranging from 30 days to 90 days from suppliers.

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The following table sets forth an aging analysis of the trade payables as of the dates indicated, based on the invoice date:

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Up to 1 year 249,033 294,387 340,732 410,374 1 to 2 years 32,773 65,195 82,299 61,561 2 to 5 years 11,529 25,715 28,153 25,303 Over 5 years 4,061 6,231 2,837 2,989

Total 297,396 391,528 454,021 500,227

Our trade payables increased by 31.6% from RMB297.4 million as of December 31, 2018 to RMB391.5 million as of December 31, 2019, by 16.0% to RMB454.0 million as of December 31, 2020 and further increased by 10.2% to RMB500.2 million as of March 31, 2021, primarily due to our business expansion.

For the three months ended For the years ended December 31, March 31, 2018 2019 2020 2021

Average trade payables turnover days (1) 48 55 64 69

Note:

(1) Average trade payables turnover days for a year equals average trade payables divided by cost of services for the year and then multiplied by 365 for a one-year period and 90 for a three-month period. Average trade payables are calculated as trade payables as of the beginning of the year plus trade payables as of the end of the year, divided by two.

Our average trade payable turnover days indicate the average time we take to make payments to suppliers, which increased during the Track Record Period primarily due to our more efficient use of cash resources to the extent permitted under the credit terms granted to us, as well as seasonality effect for the three months ended March 31, 2021 due to the holiday season.

As of May 31, 2021, RMB213.3 million, or 42.6% of our trade payables as of March 31, 2021 were subsequently settled.

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Our other payables mainly represent (i) accrued payroll; (ii) deposits received from customers and suppliers such as performance bond, retention deposits and prepaid utility costs; (iii) other tax payables mainly relating to value-added tax and tax surcharges; (iv) amounts due to related parties primarily relating to payments made by the related parties on behalf of us; (v) Income from common area received on behalf of residents; (vi) utility and other payables. (vii) advance received in relation to sales of assets held for sale; and (viii) others, primarily consisting of payments we collected on behalf of third party contractors and utility providers from property developers and property owners. The following table sets forth a breakdown of our other payables as of the dates indicated.

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Other payables – Accrued payroll 125,405 172,754 221,977 218,277 – Deposits 170,218 181,584 155,118 159,782 – Income from common area received on behalf of property owners 45,457 73,403 99,471 107,703 – Advances received in relation to sales of assets held for sale 28,878 59,280 69,882 68,583 – Utility and other payables 90,079 50,006 39,333 26,367 – Amounts due to related parties 31,638 10,570 6,851 6,604 – Other taxes payables 40,295 10,522 6,449 6,122 – Consideration payable for business combination under common control – – – 109,256 – [REDACTED] expenses – – – [REDACTED] – Others 153,704 72,850 14,151 15,898

685,674 630,969 613,232 [REDACTED]

Our other payables decreased by 8.0% from RMB685.7 million as of December 31, 2018 to RMB631.0 million as of December 31, 2019 and further decreased by 2.8% to RMB613.2 million as of December 31, 2020, primarily attributable to the decrease in others, as an increasing amount of payments to be made to third party contractors and utility providers was directly made by property developers and property owners instead of through us, and the payments we collected on behalf of such third party contractors and utility providers were gradually settled, partially offset by the increase in accrued payroll as a result of our business expansion. Our other payables increased by 18.6% from RMB613.2 million as of December 31, 2020 to RMB727.0 million as of March 31, 2021, primarily due to an increase in consideration payable for business combination under common control as a result of our acquisition of Foshan Chengjiruishang. See “History, Reorganization and Corporate Structure—Reorganization—Acquisition of 100% equity interest in Foshan Chengjiruishang”.

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Contract Liabilities

During the Track Record Period, contract liabilities mainly represent our obligations to provide the contracted services to customers. We recorded contract liabilities in the amount of RMB162.5 million, RMB209.7 million, RMB205.1 million and RMB157.9 million as of December 31, 2018, 2019 and 2020 and March 31, 2021, respectively. The increase of contract liabilities from RMB162.5 million as of December 31, 2018 to RMB209.7 million as of December 31, 2019 primarily as a result of our business expansion. Our contract liabilities remained relatively stable from RMB209.7 million as of December 31, 2019 to RMB205.1 million as of December 31, 2020, but decreased to RMB157.9 million as of March 31, 2021, primarily due to seasonality effect, as we generally collect advance payment for property management fees in the fourth quarter of the year.

Redeemable Shares

Redeemable shares represent certain ordinary shares with preference rights which we issued to certain third-party investors prior to and during the Track Record Period. As of December 31, 2018, 2019 and 2020 and March 31, 2021, we recorded redeemable shares amounting to RMB569.4 million, RMB562.3 million, nil and nil, respectively. Based on the assessment of the host instruments and the preference rights embedded, We did not bifurcate any embedded derivatives from the host instruments and designated the entire instruments as financial liabilities at fair value through profit or loss, with the changes in the fair value recorded in the consolidated statements of comprehensive income. See Note 34 to the Accountant’s Report in Appendix I to this document for details.

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CURRENT ASSETS AND CURRENT LIABILITIES

The following table sets out current assets and current liabilities as of the dates indicated:

As at As at As at December 31, March 31, April 30, 2018 2019 2020 2021 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Current assets Inventories – 1,847 2,788 5,583 4,201 Trade and other receivables 676,147 748,137 883,730 1,086,578 1,171,792 Finance lease receivables 3,375 3,476 3,501 610 813 Prepayments 113,668 93,371 114,609 134,458 133,271 Financial assets at fair value through profit or loss 48,509 17,575 46,789 61,817 61,813 Payments on behalf of residents 79,138 61,694 60,000 63,182 63,182 Restricted bank deposits 5,859 6,799 9,912 8,539 8,539 Cash and cash equivalents 530,299 523,733 514,213 366,363 402,013 Assets held for sale 77,062 150,875 145,548 144,412 144,412

1,534,057 1,607,507 1,781,090 1,871,542 1,990,036

Current liabilities Trade and other payables 983,070 1,022,497 1,067,253 1,227,201 1,228,317 Receipts on behalf of residents 145,949 127,178 142,120 151,921 151,921 Contract liabilities 162,479 209,651 205,055 157,914 155,282 Current income tax liabilities 35,809 46,684 45,154 73,042 68,321 Redeemable shares 569,358 562,255 − − − Borrowings 127,850 124,800 137,000 137,000 249,180 Lease liabilities 30,050 33,240 34,803 35,736 30,369

2,054,565 2,126,305 1,631,385 1,782,814 1,883,390

Net current (liabilities)/assets (520,508) (518,798) 149,705 88,728 106,646

Our net current assets decreased by RMB61.0 million from RMB149.7 million as of December 31, 2020 to RMB88.7 million as of March 31, 2021, mainly attributable to (i) an increase in trade and other payables and (ii) a decrease in cash and cash equivalents; partially offset by (i) an increase in trade and other receivables and (ii) an increase in financial assets at fair value through profit or loss.

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Our net current assets increased by RMB668.5 million from net current liabilities of RMB518.8 million as of December 31, 2019 to net current assets of RMB149.7 million as of December 31, 2020, mainly attributable to (i) transfer of the redeemable shares, (ii) an increase in financial assets at fair value through profit or loss, (iii) an increase in prepayments, and (iv) an increase in trade and other receivables, partially offset by an increase in borrowings.

Our net current liabilities decreased by RMB1.7 million from RMB520.5 million as of as of December 31, 2018 to RMB518.8 million as of December 31, 2019, mainly attributable to (i) a decrease in financial assets at fair value through profit or loss, (ii) a decrease in prepayments, and (iii) a decrease in payments on behalf of residents, partially offset by an increase in assets held for sale.

Directors’ Statements on Our Liquidity and Cash Flow Position

We recorded net current liabilities of RMB520.5 million and RMB518.8 million as of December 31, 2018 and 2019, respectively, and net current assets of RMB149.7 million, RMB88.7 million, and RMB106.6 million as of December 31, 2020, March 31, 2021 and April 30, 2021, respectively. Our net current liabilities positions as of December 31, 2018 and 2019 were mainly attributable to redeemable shares recorded as current liabilities as of the respective dates. When the redemption options of the redeemable shares were terminated in 2020, the fair value of the relevant redeemable shares were transferred to ordinary shares and capital reserves, and we recorded net current assets as of December 31, 2020, March 31, 2021 and April 30, 2021 as a result. See Note 34 to the Accountant’s Report in Appendix I to this document for details.

Despite our net current liability position as of December 31, 2018 and 2019, we have not experienced any financial difficulty with respect to our cash flows during the Track Record Period, as such net current liability position was, to a great extent, attributable to our accounting treatment for redeemable shares. Our Directors confirm that there has not been any material default on our part in the payment of trade and other payables, bank borrowings or lease liabilities, nor has there been any breach of financial deeds by us during the Track Record Period.

Taking into account the financial resources available to us, including our available banking facilities, our existing cash resources, the expected cash generated from operating activities and the estimated net proceeds from the [REDACTED], our Directors confirm, and the Joint Sponsors concur, that we have sufficient working capital for our present requirements and for at least the next 12 months from the date of this document.

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LIQUIDITY AND CAPITAL RESOURCES

Our principal use of cash has been for working capital purposes. Our main source of liquidity has been generated from cash flow from operations. In the foreseeable future, we expect cash flow from operations to continue to be our principal source of liquidity and we may use a portion of the proceeds from the [REDACTED] to finance some of our capital requirements.

Cash Flow

The following table sets forth selected cash flow data from our consolidated statements of cash flows for the years or periods indicated:

As of December 31, As of March 31, 2018 2019 2020 2020 2021 RMB’000 (Unaudited)

Operating cashflow before changes in working capital 197,990 288,782 362,370 88,303 103,206 Net cash inflow/(outflow) from operating activities 53,791 139,869 183,040 (70,794) (127,605) Net cash outflow from investing activities (75,220) (38,479) (96,200) (65,683) (8,587) Net cash outflow from financing activities (96,810) (107,956) (96,360) (12,642) (11,658)

Net decrease in cash and cash equivalents (118,239) (6,566) (9,520) (149,119) (147,850) Cash and cash equivalents as of the beginning of year/period 648,538 530,299 523,733 523,733 514,213

Cash and cash equivalents as of the end of year/period 530,299 523,733 514,213 374,614 366,363

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Net cash from operating activities

Our cash flow from operating activities primarily reflects (i) profit before tax adjusted for non-cash and non-operating items, (ii) the effects of movements in working capital, (iii) interests received, and (iv) income tax paid.

In the three months ended March 31, 2021, our net cash used in operating activities was RMB127.6 million, consisting of cash used in operations of RMB121.2 million and income tax paid of RMB6.7 million, partially offset by interest received of RMB0.3 million. Operating cash inflow before changes in working capital was RMB103.2 million, primarily attributable to profit before tax of RMB76.8 million. Changes in working capital contributed a cash outflow in the amount of RMB224.4 million, consisting primarily of (i) an increase in trade and other receivables of RMB215.3 million, and (ii) a decrease in contract liabilities of RMB47.1 million, partially offset by an increase in trade and other payables of RMB44.5 million.

In 2020, our net cash from operating activities was RMB183.0 million, consisting of cash generated from operations of RMB269.7 million and interests received of RMB1.5 million, partially offset by income tax paid of RMB88.2 million. Operating cash inflow before changes in working capital was RMB362.4 million, primarily attributable to profit before tax of RMB287.4 million. Changes in working capital contributed a cash outflow in the amount of RMB92.6 million, consisting primarily of (i) an increase in trade and other receivables of RMB134.1 million and (ii) an increase in prepayments of RMB21.2 million, partially offset by (i) an increase in trade and other payables of RMB52.0 million and (ii) an increase in receipts on behalf of residents of RMB14.9 million.

In 2019, our net cash from operating activities was RMB139.9 million, consisting of cash generated from operations of RMB193.3 million and interests received of RMB1.6 million, partially offset by income tax paid of RMB55.1 million. Operating cash inflow before changes in working capital was RMB288.8 million, primarily attributable to profit before tax of RMB185.7 million. Changes in working capital contributed a cash outflow in the amount of RMB95.5 million, consisting primarily of an increase in trade and other receivables of RMB221.7 million, partially offset by (i) an increase in trade and other payables of RMB60.5 million and (ii) an increase in receipts on behalf of residents of RMB18.8 million.

In 2018, our net cash from operating activities was RMB53.8 million, consisting of cash generated from operations of RMB98.0 million and interests received of RMB1.5 million, partially offset by income tax paid of RMB45.8 million. Operating cash inflow before changes in working capital was RMB198.0 million, primarily attributable to profit before tax of RMB110.4 million. Changes in working capital contributed a cash outflow in the amount of RMB100.0 million, consisting primarily of (i) a decrease in contract liabilities of RMB117.3 million and (ii) an increase in trade and other receivables of RMB91.1 million, partially offset by (i) an increase in trade and other payables of RMB118.4 million and (ii) an increase in receipts on behalf of residents of RMB49.4 million.

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Net cash used in investing activities

During the Track Record Period, our cash used in investing activities mainly consists of purchases of financial assets at fair value through profit or loss and purchase of items of property, plant and equipment. Our cash generated from investing activities mainly consists of proceeds from financial assets at fair value through profit or loss.

In the three months ended March 31, 2021, our net cash used in investing activities was RMB8.6 million. The net cash outflow was primarily attributable to the purchases of financial assets at fair value through profit or loss of RMB344.0 million, partially offset by proceeds from financial assets at fair value through profit or loss of RMB329.5 million.

In 2020, our net cash used in investing activities was RMB96.2 million. The net cash outflow was primarily attributable to (i) the purchases of financial assets at fair value through profit or loss of RMB1,009.2 million, (ii) the purchases of property, plant and equipment of RMB58.5 million, and (iii) advances to related parties of RMB24.8 million, partially offset by (i) proceeds from financial assets at fair value through profit or loss of RMB981.9 million, and (ii) proceeds from disposal of property, plant and equipment, intangible assets and investment properties of RMB16.0 million.

In 2019, our net cash used in investing activities was RMB38.5 million. The net cash outflow was primarily attributable to (i) the purchases of financial assets at fair value through profit or loss of RMB1,114.6 million, (ii) the purchases of property, plant and equipment of RMB57.2 million, and (iii) the purchase of intangible assets of RMB14.9 million, partially offset by proceeds from financial assets at fair value through profit or loss of RMB1,148.6 million.

In 2018, our net cash used in investing activities was RMB75.2 million. The net cash outflow was primarily attributable (i) the purchases of financial assets at fair value through profit or loss of RMB422.2 million, and (ii) the purchases of property, plant and equipment of RMB66.3 million, partially offset by proceeds from financial assets at fair value through profit or loss of RMB408.2 million.

Net cash used in financing activities

In the three months ended March 31, 2021, our net cash used in financing activities was RMB11.7 million, primarily reflecting (i) our lease payments of RMB5.2 million and (ii) repayments of borrowings of RMB4.3 million.

In 2020, our net cash used in financing activities was RMB96.4 million, primarily reflecting (i) repayments of borrowings of RMB124.8 million, (ii) dividends paid of RMB53.4 million, and (iii) lease payments of RMB28.7 million, partially offset by proceeds from borrowings of RMB120.0 million.

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In 2019, our net cash used in financing activities was RMB108.0 million, primarily reflecting (i) repayments of borrowings of RMB127.9 million, (ii) dividends paid of RMB48.0 million, (iii) lease payments of RMB27.0 million, and (iv) repayments to related parties of RMB21.1 million offset by proceeds from borrowings of RMB120.0 million.

In 2018, our net cash used in financing activities was RMB96.8 million, primarily reflecting (i) dividends paid of RMB112.5 million, (ii) repayments of borrowings of RMB102.0 million, and (iii) lease payments of RMB21.7 million, partially offset (i) proceeds from borrowings of RMB120.0 million and (ii) capital injection of RMB27.2 million.

WORKING CAPITAL

Our Directors are of the view that, after taking into account the financial resources available to us, including the estimated net proceeds of the [REDACTED], available banking facilities to us and our internally generated funds, we have sufficient working capital to satisfy our requirements for at least the next 12 months following the date of this document.

INDEBTEDNESS

Bank Borrowings

As of December 31, 2018, 2019 and 2020, March 31, 2021 and April 30, 2021, our bank borrowings, amounted to RMB166.4 million, RMB158.6 million, RMB153.8 million, RMB149.5 million and RMB261.7 million, respectively. As of April 30, 2021, we had unutilized banking facilities of RMB0.8 million.

The following table sets forth the components of our interest-bearing bank borrowings as of the dates indicated:

As at As at As at December 31, March 31, April 30, 2018 2019 2020 2021 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Non-current Secured bank loans 46,416 38,566 33,766 29,516 29,516 Less: current portion of non-current borrowings (7,850) (4,800) (17,000) (17,000) (17,000)

38,566 33,766 16,766 12,516 12,516

Current Secured bank loans 120,000 120,000 120,000 120,000 220,000 Unsecured bank loans – – – – 12,180 Add: current portion of non-current borrowings 7,850 4,800 17,000 17,000 17,000

127,850 124,800 137,000 137,000 249,180

Total 166,416 158,566 153,766 149,516 261,696

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As of April 30,2021, our bank borrowings comprised unsecured credit loans and letter of credit loans amounting to RMB9,190,000 and RMB2,990,000, respectively.

As of December 31, 2018, 2019, and 2020, March 31, 2021 and April 31, 2021, our secured bank loans were secured by:

As of As of As of December 31, March 31, April 30, 2018 2019 2020 2021 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Certificate of deposits 500 500 500 500 500 Buildings 9,239 8,651 8,063 7,916 7,867 Investment properties 243,137 247,631 249,355 250,735 250,735

252,876 256,782 257,918 259,151 259,102

The table below sets out the maturity profiles of our borrowings as of the dates indicated:

As of As of As of December 31, March 31, April 30, 2018 2019 2020 2021 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Within 1 year 127,850 124,800 137,000 137,000 139,993 Between 1 and 2 years 38,566 17,000 16,766 12,516 12,516 Between 2 and 5 years – 16,766 – – –

166,416 158,566 153,766 149,516 152,509

The weighted average effective interest rate for the years ended December 31, 2018, 2019 and 2020, the three months ended March 31, 2021 and the four months ended April 30, 2021 were 5.62%, 5.46%, 5.08%, 5.00% and 5.01%, respectively.

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Lease Liabilities

As of December 31, 2018, 2019 and 2020, March 31, 2021 and April 30, 2021, we recorded lease liabilities of of RMB95.5 million, RMB79.3 million, RMB79.3 million, RMB75.0 million and RMB69.4 million, respectively.

Our Directors confirm that we did not have any defaults in the payment of trade and non-trade payables or bank borrowings during the Track Record Period and up to the Latest Practicable Date. During the Track Record Period and up to the Latest Practicable Date, our Directors confirm that we did not (i) experience any difficulty in obtaining credit facilities, (ii) experience any withdrawal of banking facilities by a bank or receive any request to make an early repayment, or (iii) default in payment or breach any financial covenants of our bank borrowings.

Redeemable Shares

Pursuant to the relevant investment agreements, Shanghai Luyuan, holding 2.88% of our shares as of January 1, 2018, and Shengmei Tongying, holding 16.34% of our shares as of December 31, 2018 and 2019, were entitled to certain preference rights. Based on the assessment of the host instruments and the preference rights embedded, we did not bifurcate any embedded derivatives from the host instruments and designated the entire instruments as financial liabilities at fair value through profit or loss, namely redeemable shares, with the changes in the fair value recorded in the consolidated statements of comprehensive income.

The preference rights that were relevant to the assessment of the classification of the redeemable shares are summarized as follows:

• Redemption rights. If we did not meet the committed profit targets from 2017 to 2020 which were agreed in the investment agreement or would not complete the submission of listing application by June 30, 2019, at the option of the redeemable shareholders, we should redeem all, but not less than all, of the issued redeemable shares held by the redeemable shareholder out of funds legally available to us or the original shareholders before the issuance of such redeemable shares. The redemption price should be paid by us to the redeemable shares holder in the amount equaling to 100% of issue price, plus a 10% per annum interest of issue price accrued during the period from the issue date of each redeemable share until the date stated on redemption notice on which the redeemable shares were to be redeemed.

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• Anti-dilution rights. If the investment price or cost paid by any new investor was lower than the investment price or cost of the redeemable shareholder, the original shareholders, we or our management should ensure the redeemable shareholder had the right to request additional shares by additional capital injection at a nominal price or free of charge until the investment price of the redeemable shareholder was the same as the investment price of the new investor.

The above preference rights had been terminated on July 2, 2020 and the fair value of the relevant redeemable shares were transferred to ordinary shares and capital reserves upon the termination of these preference rights.

As of December 31, 2018, 2019 and 2020 and March 31, 2021 and April 30, 2021, we recorded redeemable shares in the amount of RMB569.4 million, RMB562.3 million, nil, nil and nil, respectifully.

COMMITMENTS AND CONTINGENT LIABILITIES

As of the Latest Practicable Date, except as disclosed in “Business—Legal Proceedings and Compliance—Ongoing Litigation”, we were not involved in any material legal, arbitration or administrative proceedings that, if adversely determined, we expected would materially adversely affect our business, financial position or results of operations. Except as disclosed herein and apart from intra-group liabilities, we did not have any outstanding loan capital, debt securities, debentures, bank overdrafts, mortgages, charges, guarantees, liabilities under acceptances or acceptance credits or hire purchase commitments guarantees or other material contingent liabilities or any covenant in connection therewith as of the latest date for liquidity disclosure, being the latest practicable date for the purpose of the indebtedness statement. As of the same date, we had not guaranteed the indebtedness of any Independent Third Parties. Save as otherwise disclosed above, our Directors confirm that there has been no material change in our indebtedness, capital commitments and contingent liabilities since April 30, 2021 and up to the Latest Practicable Date.

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CAPITAL EXPENDITURES

Our capital expenditures represent additions to property, plant and equipment and intangible assets, including software products. Our total capital expenditures generally remained stable from 2018 to 2020. As of March 31, 2021, our capital expenditure amounted to RMB3.2 million, primarily due to acquisition of property, plant and equipment.

The table below sets forth the amount of capital expenditures incurred during the Track Record Period.

For the three months ended For the year ended December 31, March 31, 2018 2019 2020 2020 2021 RMB’000 (Unaudited)

Additions to property, plant and equipment 66,598 58,280 61,030 3,537 3,156 Additions to intangible assets 2,946 8,710 8,883 − –

Total 69,544 66,990 69,913 3,537 3,156

For the year ending December 31, 2021, our estimated total capital expenditure is approximately RMB65.5 million, for the purpose of purchasing property, plant and equipment and intangible assets in connection with our business expansion.

Our actual capital expenditures may differ from the amounts set forth above due to various factors, including our future cash flows, results of operations and financial condition, economic conditions in the PRC, the availability of financing on terms acceptable to us, technical or other problems in obtaining or installing equipment, changes in the regulatory environment in the PRC and other factors.

OFF-BALANCE SHEET ARRANGEMENTS

We had no material off-balance sheet arrangements as of March 31, 2021, being the date of our most recent financial statement, and as of the Latest Practicable Date.

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KEY FINANCIAL RATIOS

The following table set forth our key financial ratios as of the dates or for the years or periods indicated:

As of or for the three As of or for the year ended months ended December 31, March 31, 2018 2019 2020 2021

Return on equity (1) (%) 14.3 23.2 28.2 30.1 Return on total assets(2) (%) 3.4 6.0 8.5 8.0 Current ratios(3) (times) 1.0 1.0 1.1 1.0 Gearing ratios(4) (%) 52.5 41.1 31.8 33.4

Notes:

(1) Equals profit for the year/period divided by total equity as of the end of that year/period and multiplied by 100%. Total equity as of the end of 2018 and 2019 had been adjusted by adding back redeemable shares for more meaningful comparison. Return on equity in the three months ended March 31, 2021 was annualized by multiplying by 365 and dividing by 90. Accordingly, the annualized return on equity may not be indicative of that for the full year ending December 31, 2021. Investors are cautioned not to place any undue reliance on such information.

(2) Equals profit for the year/period divided by total assets as of the end of that year/period and multiplied by 100%. Return on total assets in the three months ended March 31, 2021 was annualized by multiplying by 365 and dividing by 90. Accordingly, the annualized return on total assets may not be indicative of that for the full year ending December 31, 2021. Investors are cautioned not to place any undue reliance on such information.

(3) Equals current assets divided by current liabilities as of the same date. Current liabilities as of the end of 2018 and 2019 had been adjusted by subtracting redeemable shares for more meaningful comparison.

(4) Equals total interest-bearing borrowings divided by total equity as of the end of that year/period and multiplied by 100%. Total equity as of the end of 2018 and 2019 had been adjusted by adding back redeemable shares for more meaningful comparison.

Return on Equity

Our return on equity increased from 28.2% in 2020 to 30.1% in the three months ended March 31, 2021, mainly attributable to the growth of our annualized profit outpaced the growth in our equity.

Our return on equity increased from 23.2% in 2019 to 28.2% in 2020, mainly attributable to the growth of our profit for the year, which outpaced the growth in our equity.

Our return on equity increased from 14.3% in 2018 to 23.2% in 2019, mainly due to the growth of our profit for the year, which outpaced the growth in our equity.

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Return on Total Assets

Our return on assets decreased from 8.5% in 2020 to 8.0% in the three months ended March 31, 2021, mainly attributable to an increase in our total assets, which was mainly due to the increase in trade and other receivables, that outpaced the growth of our annualized profit.

Our return on assets increased from 6.0% in 2019 to 8.5% in 2020, mainly attributable to the growth of our profit for the year, which outpaced the growth in our total assets.

Our return on assets increased from 3.4% in 2018 to 6.0% in 2019, mainly due to the growth of our profit for the year, which outpaced the growth in our total assets.

Current Ratio

Our current ratio remained relatively stable during the Track Record Period.

Gearing Ratio

Our gearing ratio increased from 31.8% in 2020 to 33.4% in the three months ended March 31, 2021, mainly attributable to a decrease in our equity from December 31, 2020 to March 31, 2021 as a result of deemed distribution arising from business combination under common control, which reduced our other reserves.

Our gearing ratio decreased from 41.1% in 2019 to 31.8% in 2020, mainly attributable to an increase in our equity as a result of the increase in our retained earnings.

Our gearing ratio decreased from 52.5% in 2018 to 41.1% in 2019, mainly due to an increase in our equity as a result of the increase in our retained earnings.

MARKET RISKS

We are exposed to a variety of market risks, including interest rate risk, credit risk and liquidity risk, as set out below. We manage and monitor these exposures to ensure appropriate measures are implemented on a timely and effective manner. As of the Latest Practicable Date, we did not hedge or consider necessary to hedge any of these risks. For further details, including relevant sensitivity analysis, please see Note 3 in Appendix I to this document.

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Interest Rate Risk

We are exposed to fair value interest rate risk in relation to fixed rate bank borrowings. We are also exposed to cash flow interest rate risk in relation to variable-rate bank balances and bank borrowings. Management monitors interest rate exposure and will consider hedging significant interest rate exposure should the need arises. Our Directors consider that the fair value interest rate risk and cash flow interest rate risk are insignificant.

Credit Risk

We are exposed to credit risk in relation to its trade and other receivables, restricted bank deposits, cash and cash equivalents, and financial assets at fair value through profit or loss. The carrying amounts of trade and other receivables, payments on behalf of residents, restricted bank deposits, cash and cash equivalents and financial assets at fair value through profit or loss represent the Group’s maximum exposure to credit risk in relation to financial assets.

Liquidity Risk

We monitor and maintain a level of cash and cash equivalents deemed adequate by our Directors to finance our operations and mitigate the effects of fluctuations in cash flows.

The following table sets forth maturity profile of our financial liabilities as of December 31, 2018, 2019 and 2020 and March 31, 2021 based on the contractual undiscounted payments.

Between Between Less than 1 and 2 and Over Carrying 1 year 2 years 5 years 5 years Total Amount RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000

As of March 31, 2021 Borrowings 139,045 12,796 – – 151,841 149,516 Trade and other payables (excluding other tax payables and accrued payroll) 1,002,802–––1,002,802 1,002,802 Receipts on behalf of residents 151,921–––151,921 151,921 Lease liabilities 36,592 11,460 32,482 5,801 86,335 74,950

Total 1,330,360 24,256 32,482 5,801 1,392,899 1,379,189

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Between Between Less than 1 and 2 and Over Carrying 1 year 2 years 5 years 5 years Total Amount RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000

As of December 31, 2020 Borrowings 140,426 17,437 – – 157,863 153,766 Trade and other payables (excluding other tax payables and accrued payroll) 838,827–––838,827 838,827 Receipts on behalf of residents 142,120–––142,120 142,120 Lease liabilities 35,545 11,884 33,187 7,896 88,512 79,251

Total 1,156,918 29,321 33,187 7,896 1,227,322 1,213,964

As of December 31, 2019 Borrowings 127,389 18,166 17,437 – 162,992 158,566 Trade and other payables (excluding other tax payables and accrued payroll) 839,221–––839,221 839,221 Receipts on behalf of residents 127,178–––127,178 127,178 Lease liabilities 34,206 14,699 25,365 16,149 90,419 79,336 Redeemable shares 460,546–––460,546 562,255

Total 1,588,540 32,865 42,802 16,149 1,680,356 1,766,556

As of December 31, 2018 Borrowings 130,649 40,771 – – 171,420 166,416 Trade and other payables (excluding other tax payables and accrued payroll) 817,370–––817,370 817,370 Receipts on behalf of residents 145,949–––145,949 145,949 Lease liabilities 30,841 25,687 29,783 24,483 110,794 95,492 Redeemable shares 420,498–––420,498 569,358

Total 1,545,307 66,458 29,783 24,483 1,666,031 1,794,585

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RELATED PARTY TRANSACTIONS

Parties are considered to be related if one party has the ability, directly or indirectly, control the other party or exercise significant influence over the other party in making financial and operation decisions. Parties are also considered to be related if they are subject to common control. Members of key management and their close family members of us are also considered as related parties. For a detailed discussion of related party transactions, see Note 36 in Appendix I to this document.

Significant Related Party Transactions

During the Track Record Period, we had certain related party transactions, mainly (i) provision of services; (ii) purchase of services; and (iii) lease of carpark spaces.

These related party transactions were conducted in accordance with terms as agreed between us and the respective related parties. Our Directors confirm that all the aforementioned related party transactions during the Track Record Period were conducted on normal commercial terms that are reasonable and in the interest of our Group as a whole. Our Directors further confirm that these related party transactions would not distort our results of operations for the Track Record Period or make our historical results not reflective of our future performance.

Provision of services

In 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, we provided services, including property management services and professional services, to related parties, in an aggregate amount of RMB5.4 million, RMB9.5 million, RMB13.9 million, RMB1.2 million and RMB2.3 million, respectively.

Purchase of services

We purchased certain services, primarily including cleaning services and greening and gardening services, from related parties in 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021, and paid service fees in an aggregate amount of RMB29.9 million, RMB26.3 million, RMB20.0 million, RMB5.3 million and RMB1.7 million, respectively, to our related parties.

Lease of carpark spaces

We leased certain carpark spaces from related parties in 2020 and the three months ended March 31, 2020 and 2021, and paid rents in an aggregate amount of RMB4.8 million, RMB1.2 million and RMB1.2 million, respectively, to our related parties.

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Balances with Related Parties

The table below sets forth the balances with related parties as of the dates indicated:

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Amounts due from/to related parties Trade receivables – Centralcon Capital and its subsidiaries 40 68 89 324 – Changcheng Property Group Co., Ltd. Trade Union Committee (長城物業集團股份有限公司工會委員會) (the "Trade Union") –404040 – Joint ventures 2,340 2,627 6,801 8,430

2,380 2,735 6,930 8,794

Other receivables – Shenzhen jiaye Investment 11,693 5,795 28,079 29,334 – Changcheng Property Group Co., Ltd. Trade Union Committee (長城物業集團股份有限公司工會委員會) (the “Trade Union”) 8,145 8,145 8,145 8,145 – Joint ventures 486 1,295 3,761 5,129

20,324 15,235 39,985 42,608

Trade payables – Centralcon Capital – – 5,000 6,283 – Joint ventures 4,250 5,295 1,014 1,063

4,250 5,295 6,014 7,346

Other payables – Centralcon Capital and its subsidiaries 10,495 10,555 6,594 6,594 – Shenzhen Jiaye Investment 20,993––– – Joint ventures 150 15 257 10

31,638 10,570 6,851 6,604

Contract liabilities – Centralcon Capital and its subsidiaries – 23 – – – Joint ventures – 33 – –

–56––

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Our Directors are of the view that the related party transactions were conducted on a normal commercial terms and were fair and reasonable as a whole, and would not distort our track record results or make the historical results not reflective of our future performance. As of December 31, 2018, 2019 and 2020 and March 31, 2021, our non-trade related amounts due from related parties amounted to RMB20.3 million, RMB15.2 million, RMB40.0 million and RMB42.6 million, respectively, and our non-trade related amounts due to related parties amounted to RMB31.6 million, RMB10.6 million, RMB6.9 million and RMB6.6 million, respectively. Our Directors confirm that all related party balances that are non-trade in nature will be fully settled prior to the [REDACTED]. For further details on related party balances and transactions, please refer to Note 36 in Appendix I to this document.

DIVIDENDS AND DIVIDEND POLICY

In 2018, 2019 and 2020 and the three months ended March 31, 2021, we distributed dividends in the aggregate amount of RMB111.7 million, RMB46.7 million, RMB52.4 million and nil. In April 2021, we announced dividend in the amount of RMB102.7 million to be paid to our existing shareholders. As of the Latest Practicable Date, we have distributed such dividends in the amount of RMB65.9 million and expect to distribute the remaining RMB36.8 million by the end of July 2021. As of the Latest Practicable Date, except otherwise disclosed, we had not proposed payment of dividend for the months up to the [REDACTED] in the year ending December 31, 2021, nor formulated any plans as to whether such dividends would be paid to the pre-[REDACTED] shareholders. Holders of our Shares will be entitled to receive such dividends pro rata according to the amounts paid up or credited as paid up on the shares.

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DISTRIBUTABLE RESERVES

As of March 31, 2021, our Group had retained profits of RMB541.8 million under HKFRS, as reserves available for distribution to our equity shareholders.

DISCLOSURE PURSUANT TO RULES 13.13 TO 13.19 OF THE LISTING RULES

Except as otherwise disclosed in this document, we confirm that, as of the Latest Practicable Date, we were not aware of any circumstances that would give rise to a disclosure requirement under Rules 13.13 to Rules 13.19 of the Listing Rules.

[REDACTED] EXPENSES

The total amount of [REDACTED] expenses that will be borne by us in connection with the [REDACTED], including [REDACTED], is estimated to be approximately RMB[REDACTED] (HK$[REDACTED]) (based on the mid-point of the indicative [REDACTED], before the exercise of the [REDACTED]), representing approximately [REDACTED]% of the gross proceeds from the [REDACTED], of which RMB[REDACTED] (HK$[REDACTED]) is expected to be accounted for as a deduction from equity upon completion of the [REDACTED]. The remaining fees and expenses include RMB[REDACTED] (HK$[REDACTED]) was charged to our profit or loss during the Track Record Period and RMB[REDACTED] (HK$[REDACTED]) are expected to be charged to our profit or loss subsequent to the end of the Track Record Period and upon completion of the [REDACTED]. The professional fees and/or other expenses related to the preparation of [REDACTED] are currently in estimates for reference only and the actual amount to be recognized is subject to adjustment based on audit and the then changes in variables and assumptions. Our Directors do not expect our [REDACTED] expenses to have a material adverse impact on our financial performance for year ending December 31, 2021.

UNAUDITED PRO FORMA ADJUSTED CONSOLIDATED NET TANGIBLE ASSETS

The following unaudited pro forma adjusted consolidated net tangible assets prepared in accordance with Rule 4.29 of the Listing Rules are set out to illustrate the effect of the [REDACTED] on the consolidated net tangible assets of our Group attributable to the owners of our Company as of March 31, 2021 as if the [REDACTED] had taken place on that date.

The unaudited pro forma adjusted consolidated net tangible assets attributable to owners of our Company have been prepared for illustrative purposes only and, because of its hypothetical nature, may not give a true picture of the consolidated net tangible assets of our Group had the [REDACTED] been completed as of March 31, 2021 or at any future dates. It is prepared based on the consolidated net assets of our Group as of March 31, 2021 as set out in the Accountant’s Report of our Group, the text of which is set out in Appendix I to this document, and adjusted as described below. The unaudited pro forma statement of adjusted consolidated net tangible assets does not form part of the Accountant’s Report.

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Unaudited pro forma Audited adjusted consolidated consolidated net tangible net tangible assets assets attributable to attributable to owners of the Estimated net owners of the Company as proceeds from Company as Unaudited pro forma at March 31, the Global at March 31, adjusted consolidated net 2021(1) [REDACTED](2) 2021 tangible assets per Share(3)(4) RMB’000 RMB’000 RMB’000 RMB HK$

Based on an [REDACTED] of HK$[[REDACTED]] per H Share 649,194 [REDACTED] [REDACTED] [REDACTED] [REDACTED]

Based on an[REDACTED] of HK$[[REDACTED] ] per H Share 649,194 [REDACTED] [REDACTED] [REDACTED] [REDACTED]

Notes:

(1) The audited consolidated net tangible assets attributable to owners of the Company as at March 31, 2021 is extracted from the Accountant’s Report set out in Appendix I to this document, which is based on the audited consolidated equity attributable to owners of the Company as at March 31, 2021 of approximately RMB666,353,000 with an adjustment for the intangible assets attributable to the owners of the Company as at March 31, 2021 of approximately RMB17,159,000.

(2) The estimated net proceeds from the [REDACTED] are based on [REDACTED] H Shares and the indicative [REDACTED] of HK$[REDACTED] per H Share and HK$[REDACTED] per H share, after deduction of the estimated [REDACTED] fees and other related expenses payable by the Group, and takes no account of any shares which may be issued upon the exercise of the [REDACTED].

(3) The unaudited pro forma adjusted consolidated net tangible assets per Share is calculated based on [REDACTED] Shares were in issue immediately following the completion of the [REDACTED] and does not take into account of 5,668,834 shares issued to Xicheng Rui’an on April 30, 2021 and any Shares which may be issued upon the exercise of the [REDACTED].

(4) The unaudited pro forma adjusted consolidated net tangible assets per Share is converted into Hong Kong dollars at an exchange rate of RMB0.82585 to HK$1.00. No representation is made that Renminbi amounts have been, could have been or may be converted into Hong Kong dollars, or vice versa, at that rate.

(5) No adjustment has been made to reflect any trading result or other transactions of the Group entered into subsequent to March 31, 2021, including 5,668,834 shares issued to Xicheng Rui’an with a total cash consideration of approximately RMB44,104,000 and a dividend of approximately RMB102,745,000 declared by the Company in April 2021. Had this issuance of shares to Xicheng Rui’an and the payment of such dividend been taken into account, the unaudited pro forma adjusted consolidated net tangible assets attributable to owners of the Company would have decreased from HK$[REDACTED] per H Share to HK$[REDACTED] per H Share, and HK$[REDACTED] per H Share to HK$[REDACTED] per H Share, based on the indicative [REDACTED] of HK$[REDACTED] per H Share and HK$[REDACTED] per H share respectively.

DIRECTORS’ CONFIRMATION ON NO MATERIAL AND ADVERSE CHANGE

After due and careful consideration, save as disclosed in “Business—Effects of the COVID-19 Outbreak” in this document, our Directors confirm that, up to the date of this document, there has been no material and adverse change in our financial and trading position or prospects since March 31, 2021, and there is no event since March 31, 2021 that would materially affect the information shown in the Accountant’s Report, the text of which is set forth in Appendix I to this document.

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See “Business—Business Strategies” for a detailed description of our future plans.

USE OF PROCEEDS

We estimate that we will receive net proceeds of approximately HK$[REDACTED] from the [REDACTED], after deducting the [REDACTED] and other estimated expenses payable by us in connection with the [REDACTED], assuming that the [REDACTED] is not exercised and assuming an [REDACTED] of HK$[REDACTED] per Share (being the mid-point of the indicative [REDACTED] set forth on the cover page of this document). We intend to use such net proceeds from the [REDACTED] for the purposes and in the amounts set forth below:

• approximately [REDACTED]%, or approximately HK$[REDACTED], will be used to further increase our business scale and market share, and diversify the types of projects and properties under our management through acquisition and investment; among which (i) approximately [REDACTED]%, or HK$[REDACTED], will be used to acquire or invest in property management companies, (ii) approximately [REDACTED]%, or HK$[REDACTED], will be used to acquire or invest in companies providing city operation services; and (iii) approximately [REDACTED]%orHK$[REDACTED], will be used to acquire or invest in value-added services providers, such as those providing community health services and early childhood education services, to further enhance our ability in providing value-added services. Our selection criteria for a potential property management target company include but are not limited to: (a) GFA under management of at least 3.0 million sq.m., (b) revenue at least RMB50.0 million and (c) net profit excluding extraordinary profit and loss of at least RMB4.0 million in the latest financial year. We will prioritize in assessing potential investment or acquisition targets with a portfolio of managed properties located in tier-one and new tier-one cities and provincial capitals, with a portfolio of managed properties involving property types such as residential properties, office building and commercial complex. According to CIA, there are more than 500 property companies with GFA under management of at least 3.0 million sq.m., revenue of at least RMB50.0 million and net profit excluding extraordinary profit and loss of at least RMB4.0 million in 2020. Amongst these property companies, around 100 of them are not affiliated with property developers in China and can become our potential acquisition targets, according to CIA. As such, our Directors believe that there are sufficient number of suitable target companies available in the market for our aforementioned expansion plan, even when taking into account property management companies’ affiliation with property developers. As of the Latest Practicable Date, we had not identified any acquisition or investment targets for our use of net proceeds from the [REDACTED]. For value-added services providers, we will prioritize in assessing potential investment or acquisition targets that (a) operate in tier-one cities; (b) have a stable financial track record; (c) have an experienced management and service team; and (d) have established good industry reputation. We are also more inclined to consider companies in which we could obtain controlling interest to better employ our investment strategies and business integration;

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• approximately [REDACTED]%, or approximately HK$[REDACTED], will be used to enhance our research and development capability and further develop and upgrade our digitalization platforms, among which, (i) approximately [REDACTED]%, or HK$[REDACTED], will be used to further develop our information technology capabilities, including upgrading our software and SaaS systems to improve our services to our alliance members and upgrading our smart management system; (ii) approximately [REDACTED]%, or HK$[REDACTED], will be used to upgrade and expand the coverage of our IoT-based smart management system, including the purchase of computer hardwares and network servers to support our data analytics platform, as well as the purchase and upgrade smart devices such as AI-enabled security cameras, automated cleaning robots, patrol robots and car plate recognition devices, to support our smart management systems;

• approximately [REDACTED]%, or approximately HK$[REDACTED], will be used to improve our organizational skill and operational efficiency, among which, (i) approximately [REDACTED]%, or HK$[REDACTED], will be used to engage management consultants to streamline our business operation and enhance our competitiveness; (ii) approximately [REDACTED]%, or HK$[REDACTED], will be used to enhance our staff training and recruitment efforts to improve our human resources; (iii) approximately [REDACTED]%, or HK$[REDACTED], will be used to further develop our community programs to enhance our bonding with the residents; and (iv) approximately [REDACTED]%, or HK$[REDACTED], will be used to develop new service products that cater to the needs of our customers;

• approximately [REDACTED]%, or approximately HK$[REDACTED], will be used to enhance our sales and marketing capabilities, among which (i) approximately [REDACTED]%, or HK$[REDACTED], will be used to improve our brand recognition through marketing campaigns; (ii) approximately [REDACTED]%, or HK$[REDACTED], will be used to expand our marketing channels by cooperation with other players in the industry; and (iii) approximately [REDACTED]%, or HK$[REDACTED], will be used to expand our marketing team and invest in their training and improvement; and

• approximately [REDACTED]%, or approximately HK$[REDACTED], will be used for general business operations and working capital.

The above allocation of the proceeds will be adjusted on a pro rata basis in the event that the [REDACTED] is fixed at a higher or lower level compared to the mid-point of the estimated [REDACTED] or the [REDACTED] is exercised.

If the [REDACTED] is determined at HK$[REDACTED] per [REDACTED], being the high end of the indicative [REDACTED] stated in this document, we will receive additional net proceeds of approximately HK$[REDACTED].Ifthe[REDACTED] is fixed at HK$[REDACTED] per [REDACTED], being the low end of the indicative [REDACTED] stated in this document, the net proceeds we receive will be reduced by approximately HK$[REDACTED].

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If the [REDACTED] is exercised in full, we estimate that the additional net proceeds from the [REDACTED] of these additional Shares will be approximately HK$[REDACTED], after deducting the [REDACTED] and other estimated expenses payable by us in connection with the [REDACTED], assuming an [REDACTED] of HK$[REDACTED] per Share, being the mid-point of the indicative [REDACTED].

To the extent that the net proceeds from the [REDACTED] are not immediately applied to the purposes stated above, and to the extent permitted by applicable laws and regulations, we intend to deposit the proceeds into accounts with licensed financial institutions. We will make a formal announcement in the event that there is any change in our use of net proceeds from the purposes stated above or in our allocation of the net proceeds in the proportions stated above.

Bases and Assumptions

Our future plans and business strategies are based on the following general assumptions:

• we will have sufficient financial resources to meet the planned capital expenditure and business development requirements during the period to which our future plans relate;

• there will be no material changes in the funding requirement for each of our future plans described in this document from the amount as estimated by our Directors;

• there will be no material changes in existing laws and regulations, or other government policies relating to our Group, our industry or the political or market environment in which we operate;

• there will be no material changes in the existing accounting policies from those stated in the Accountant’s Report in Appendix I as of and for the years ended December 31, 2018, 2019 and 2020 and the three months ended March 31, 2021;

• the [REDACTED] will be completed in accordance with and as described in the section headed “Structure of the [REDACTED]” in this document;

• there will be no material changes in the bases or rates of taxation applicable to our activities;

• we will continue our business operations in the same manner as we had operated during the Track Record Period;

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• our operations including our future plans will not be interrupted by any force majeure, unforeseeable factors, extraordinary items or economic changes in respect of, among others, inflation and interest rate, in the PRC;

• there will be no disasters, natural, political or otherwise, which would not materially disrupt our business or operations; and

• we will not be materially affected by the risk factors as set out in the “Risk Factors” in this document.

IMPLEMENTATION PLAN

The following table sets out approximate amount, sources of funding, key milestones and timeframe for each strategic plan. Investors should note that the following implementation plan was formulated on the bases and assumptions referred to in “—Use of Proceeds—Bases and Assumptions” above. The bases and assumptions outlined are inherently subject to uncertainties, particularly those outlined in the section headed “Risk Factors” in this document. Our actual course of business may vary from the business strategies set forth in this document due to unforeseeable events, and there can be no assurance that we will accomplish our business strategies in a timely manner, or at all.

Key milestones and proceeds Percentage Amount of net of total Major category Sub-category Implementation activities proceeds proceeds Timeframe and amount

Further increase our • Acquire or invest • We intend to acquire targets with HK$[REDACTED] [REDACTED]% • 2021, business scale and in property (a) revenue of at least RMB30.0 HK$[REDACTED] market share, and management million and (b) net profit • 2022, diversify the types of companies excluding extraordinary profit HK$ [REDACTED] projects and properties and loss of at least RMB4.0 • 2023, under our management million in the latest financial year. HK$ [REDACTED] through acquisition and We will prioritize in assessing investment potential investment or acquisition targets with a portfolio of managed properties located in tier-one and new tier-one cities and provincial capitals. with a portfolio of managed properties involving property types such as office building and commercial complex.

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Key milestones and proceeds Percentage Amount of net of total Major category Sub-category Implementation activities proceeds proceeds Timeframe and amount

• Acquire • We intend to acquire targets (a) HK$[REDACTED] [REDACTED]% • 2021, companies located in select cities; (b) provide HK$[REDACTED] providing city city operation services such as • 2022, operation city facility management, city HK$[REDACTED] services environment maintenance, city • 2023, landscaping and city resource HK$[REDACTED] management services; and (c) with competitive strength in their area of expertise. We also intend to form joint ventures with municipal investment companies to provide city operation services.

• Acquire • We will prioritize in assessing HK$[REDACTED] [REDACTED]% • 2021, value-added potential investment or HK$[REDACTED] services acquisition targets that (a) operate • 2022, providers in tier-one cities; (b) have a stable HK$[REDACTED] financial track record; (c) have an • 2023, experienced management and HK$[REDACTED] service team; and (d) have established good industry reputation.

Further enhance our • Further develop • Upgrade our software and SAAS HK$[REDACTED] [REDACTED]% • 2021, research and our information systems to improve our services HK$[REDACTED] development capability technology to our alliance members and • 2022, and develop and capabilities further develop and upgrade our HK$[REDACTED] upgrade our smart management system to • 2023, digitalization improve our operational HK$[REDACTED] platforms efficiency

• Upgrade and • Purchase computer hardwares HK$[REDACTED] [REDACTED]% • 2021, expand the and network servers to support HK$[REDACTED] coverage of our our data analytics platform, as • 2022, IoT-based smart well as smart devices such as HK$[REDACTED] management AI-enabled security cameras, • 2023, system automatedcleaning robots HK$[REDACTED] security patrol robots and car plate recognition devices to supportour smart management systems

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Key milestones and proceeds Percentage Amount of net of total Major category Sub-category Implementation activities proceeds proceeds Timeframe and amount

Improve our • Engage • Engage management consultants HK$[REDACTED] [REDACTED]% • 2021, organizational skill and management to study and analyze our HK$[REDACTED] operational efficiency consultants to operational process, our key • 2022, streamline our service and products, our talent HK$[REDACTED] business development and other matters. • 2023, operation and HK$[REDACTED] enhance our competitiveness

• Enhance our staff • Enhance recruitment efforts for HK$[REDACTED] [REDACTED]% • 2021, training and quality talents. HK$[REDACTED] recruitment • Improve employees’ working • 2022, efforts to conditions and other benefits to HK$[REDACTED] improve our improve staff morale and attract • 2023, human resources talents. HK$[REDACTED] • Establish internal training programs and provide EMBA and other continuing education opportunities.

• Further develop • Establish and maintain volunteer HK$[REDACTED] [REDACTED]% • 2021, our community worker stations. We intend to HK$[REDACTED] programs to build 200 volunteer worker • 2022, enhance our stations in 2022, 300 volunteer HK$[REDACTED] bonding with the worker stations in 2023 and 500 • 2023, residents volunteer worker stations in 2024. HK$[REDACTED] • Organize community programs and other charitable events.

• Develop new • Develop new service products by HK$[REDACTED] [REDACTED]% • 2021, service products analyzing feedbacks and data HK$[REDACTED] that cater to the collected from customers to • 2022, needs of our provide tailored and targeted HK$[REDACTED] customers services. • 2023, HK$[REDACTED]

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Key milestones and proceeds Percentage Amount of net of total Major category Sub-category Implementation activities proceeds proceeds Timeframe and amount

Enhance our sales and • Improve our • Organize marketing and publicity HK$[REDACTED] [REDACTED]% • 2021, marketing capabilities brand events. HK$[REDACTED] recognition • Conduct advertisement • 2022, through campaigns. HK$[REDACTED] marketing • 2023, campaigns HK$[REDACTED]

• Expand our • Engage other market players to HK$[REDACTED] [REDACTED]% • 2021, marketing expand our marketing channels HK$[REDACTED] channels by and source new property • 2022, cooperation with management projects. HK$[REDACTED] other players in • 2023, the industry HK$[REDACTED]

• Expand our • Recruit additional marketing HK$[REDACTED] [REDACTED]% • 2021, marketing team staff. HK$[REDACTED] and invest in • Improve staff compensation to • 2022, their training and attract talents. HK$[REDACTED] improvement • Improve and enhance staff • 2023, training systems. HK$[REDACTED]

Working capital and other – – HK$[REDACTED] [REDACTED]% • 2021, general corporate HK$[REDACTED] purposes • 2022, HK$[REDACTED] • 2023, HK$[REDACTED]

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[REDACTED]

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The following is the text of a report set out on pages I-1 to I-3, received from the Company’s reporting accountant, PricewaterhouseCoopers, Certified Public Accountants, Hong Kong, for the purpose of incorporation in this document. It is prepared and addressed to the directors of the Company and to the Joint Sponsors pursuant to the requirements of HKSIR 200 Accountants’ Reports on Historical Financial Information in Investment Circulars issued by the Hong Kong Institute of Certified Public Accountants.

ACCOUNTANT’S REPORT ON HISTORICAL FINANCIAL INFORMATION TO THE DIRECTORS OF CHANGCHENG PROPERTY GROUP CO., LTD. AND HUATAI FINANCIAL HOLDINGS (HONG KONG) LIMITED AND PING AN OF CHINA CAPITAL (HONG KONG) COMPANY LIMITED

Introduction

We report on the historical financial information of Changcheng Property Group Co., Ltd. (the “Company”) and its subsidiaries (together, the “Group”) set out on pages I-4 to I-101, which comprises the consolidated balance sheets as at December 31, 2018, 2019 and 2020 and March 31, 2021, the Company’s balance sheets as at December 31, 2018, 2019, 2020 and March 31, 2021, and the consolidated statements of comprehensive income, the consolidated statements of changes in equity and the consolidated statements of cash flows for each of the years ended December 31, 2018, 2019 and 2020 and the three months ended March 31, 2021 (the “Track Record Period”) and a summary of significant accounting policies and other explanatory information (together, the “Historical Financial Information”). The Historical Financial Information set out on pages I-4 to I-101 forms an integral part of this report, which has been prepared for inclusion in the document of the Company dated [REDACTED] (the “Document”) in connection with the [REDACTED] of H shares of the Company on the Main Board of The Stock Exchange of Hong Kong Limited.

Directors’ responsibility for the Historical Financial Information

The directors of the Company are responsible for the preparation of Historical Financial Information that gives a true and fair view in accordance with the basis of preparation set out in Note 2.1 to the Historical Financial Information, and for such internal control as the directors determine is necessary to enable the preparation of Historical Financial Information that is free from material misstatement, whether due to fraud or error.

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Reporting accountant’s responsibility

Our responsibility is to express an opinion on the Historical Financial Information and to report our opinion to you. We conducted our work in accordance with Hong Kong Standard on Investment Circular Reporting Engagements 200, Accountants’ Reports on Historical Financial Information in Investment Circulars issued by the Hong Kong Institute of Certified Public Accountants (“HKICPA”). This standard requires that we comply with ethical standards and plan and perform our work to obtain reasonable assurance about whether the Historical Financial Information is free from material misstatement.

Our work involved performing procedures to obtain evidence about the amounts and disclosures in the Historical Financial Information. The procedures selected depend on the reporting accountant’s judgment, including the assessment of risks of material misstatement of the Historical Financial Information, whether due to fraud or error. In making those risk assessments, the reporting accountant considers internal control relevant to the entity’s preparation of Historical Financial Information that gives a true and fair view in accordance with the basis of preparation set out in Note 2.1 to the Historical Financial Information in order to design procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Our work also included evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the Historical Financial Information.

We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Opinion

In our opinion, the Historical Financial Information gives, for the purposes of the accountant’s report, a true and fair view of the financial position of the Company as at December 31, 2018, 2019, 2020 and March 31, 2021 and the consolidated financial position of the Group as at December 31, 2018, 2019 and 2020 and March 31, 2021 and of its consolidated financial performance and its consolidated cash flows for the Track Record Period in accordance with the basis of preparation set out in Note 2.1 to the Historical Financial Information.

Review of stub period comparative financial information

We have reviewed the stub period comparative financial information of the Group which comprises the consolidated statement of comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the three months ended March 31, 2020 and other explanatory information (the “Stub Period Comparative Financial Information”). The directors of the Company are responsible for the preparation of the Stub Period Comparative Financial Information in accordance with the basis of preparation set out in Note 2.1 to the Historical Financial Information. Our responsibility is to express a conclusion on the Stub Period Comparative Financial Information based on our review. We conducted our review in accordance with Hong

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Kong Standard on Review Engagements 2410, Review of Interim Financial Information Performed by the Independent Auditor of the Entity issued by the HKICPA. A review consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Hong Kong Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion. Based on our review, nothing has come to our attention that causes us to believe that the Stub Period Comparative Financial Information, for the purposes of the accountant’s report, is not prepared, in all material respects, in accordance with the basis of preparation set out in Note 2.1 to the Historical Financial Information.

Report on matters under the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Listing Rules”) and the Companies (Winding Up and Miscellaneous Provisions) Ordinance

Adjustments

In preparing the Historical Financial Information, no adjustments to the Historical Financial Statements as defined on page I-4 have been made.

Dividends

We refer to Note 32 to the Historical Financial Information which contains information about the dividends paid by the Company in respect of the Track Record Period.

[PricewaterhouseCoopers] Certified Public Accountants Hong Kong [REDACTED]

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I. HISTORICAL FINANCIAL INFORMATION OF THE GROUP

Preparation of Historical Financial Information

Set out below is the Historical Financial Information which forms an integral part of this accountant’s report.

The consolidated financial statements of the Group for the Track Record Period, on which the Historical Financial Information is based, were audited by PricewaterhouseCoopers in accordance with Hong Kong Standards on Auditing issued by the HKICPA (the “Underlying Financial Statements”).

The Historical Financial Information is presented in Renminbi (“RMB”) and all values are rounded to the nearest thousand (RMB’000) except when otherwise indicated.

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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Three months ended Year ended December 31, March 31, Notes 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Revenue 6 2,404,287 2,810,349 3,035,600 693,162 783,798 Cost of services 9 (1,996,141) (2,295,646) (2,397,370) (556,081) (618,552)

Gross profit 408,146 514,703 638,230 137,081 165,246

Selling and marketing expenses 9 (58,695) (83,406) (112,959) (18,656) (14,014) Administrative expenses 9 (214,537) (228,001) (269,681) (44,591) (65,406) Net impairment losses on financial assets 3.1.2 (35,411) (63,123) (23,694) (12,932) (15,084) Other income – net 7 12,820 27,019 49,721 321 3,819 Other gains – net 8 10,493 8,875 3,254 2,001 5,134

Operating profit 122,816 176,067 284,871 63,224 79,695 Finance income 11 4,646 5,856 4,384 1,358 983 Finance costs 11 (14,560) (12,674) (12,021) (2,977) (2,757)

Finance costs – net (9,914) (6,818) (7,637) (1,619) (1,774) Fair value changes of redeemable shares 34 (6,507) 7,103 338 4,262 – Share of net profits/(losses) of investments accounted for using the equity method 19 4,014 9,369 9,778 428 (1,095)

Profit before income tax 110,409 185,721 287,350 66,295 76,826 Income tax expense 12 (39,037) (51,559) (80,784) (19,203) (26,855)

Profit for the year/period 71,372 134,162 206,566 47,092 49,971

Profit attributable to: − Owners of the Company 69,245 135,344 210,012 49,920 53,268 − Non-controlling interests 2,127 (1,182) (3,446) (2,828) (3,297)

71,372 134,162 206,566 47,092 49,971

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Three months ended Year ended December 31, March 31, Notes 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Other comprehensive income Items that may be reclassified to profit or loss − Revaluation of properties 30 41,305 (4,200) (2,700) (900) – − Income tax relating to the item 30 (10,326) 1,050 675 225 –

Other comprehensive income for the year/period, net of tax 30,979 (3,150) (2,025) (675) –

Total comprehensive income for the year/period 102,351 131,012 204,541 46,417 49,971

Total comprehensive income attributable to: − Owners of the Company 100,224 132,194 207,987 49,245 53,268 − Non-controlling interests 2,127 (1,182) (3,446) (2,828) (3,297)

102,351 131,012 204,541 46,417 49,971

Earnings per share attributable to owners of the Company (expressed in RMB per share) Basic earnings per share 13 1.00 1.98 2.81 0.73 0.65

Diluted earnings per share 13 0.93 1.57 2.57 0.56 0.65

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CONSOLIDATED BALANCE SHEETS

As at As at December 31, March 31, Notes 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

ASSETS Non-current assets Property, plant and equipment 14 116,955 141,975 158,626 144,216 Right-of-use assets 15 71,983 66,864 74,098 69,562 Investment properties 16 284,366 294,872 295,208 296,032 Prepayments 25 8,992 14,131 3,452 4,512 Intangible assets 17 20,654 20,327 20,903 18,833 Investments accounted for using the equity method 19 8,794 21,867 32,112 33,573 Deferred income tax assets 20 39,042 55,448 61,969 69,716 Finance lease receivables 15,750 13,225 10,515 12,685

566,536 628,709 656,883 649,129

Current assets Inventories 21 – 1,847 2,788 5,583 Trade and other receivables 24 676,147 748,137 883,730 1,086,578 Finance lease receivables 3,375 3,476 3,501 610 Prepayments 25 113,668 93,371 114,609 [REDACTED] Financial assets at fair value through profit or loss 22 48,509 17,575 46,789 61,817 Payments on behalf of residents 26 79,138 61,694 60,000 63,182 Restricted bank deposits 27 5,859 6,799 9,912 8,539 Cash and cash equivalents 27 530,299 523,733 514,213 366,363 Assets held for sale 28 77,062 150,875 145,548 144,412

1,534,057 1,607,507 1,781,090 [REDACTED]

Total assets 2,100,593 2,236,216 2,437,973 [REDACTED]

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As at As at December 31, March 31, Notes 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

EQUITY Equity attributable to owners of the Company Share capital 29 68,223 68,223 81,544 81,544 Other reserves 30 (416,010) (410,822) 146,507 43,049 Retained earnings 267,134 347,462 494,290 541,760

(80,653) 4,863 722,341 666,353

Non-controlling interests 10,167 11,692 9,605 6,308

Total equity (70,486) 16,555 731,946 672,661

LIABILITIES Non-current liabilities Borrowings 33 38,566 33,766 16,766 12,516 Lease liabilities 15 65,442 46,096 44,448 39,214 Deferred income tax liabilities 20 12,506 13,494 13,428 13,466

116,514 93,356 74,642 65,196

Current liabilities Trade and other payables 31 983,070 1,022,497 1,067,253 [REDACTED] Receipts on behalf of residents 26 145,949 127,178 142,120 151,921 Contract liabilities 6 162,479 209,651 205,055 157,914 Current income tax liabilities 35,809 46,684 45,154 73,042 Redeemable shares 34 569,358 562,255 – – Borrowings 33 127,850 124,800 137,000 137,000 Lease liabilities 15 30,050 33,240 34,803 35,736

2,054,565 2,126,305 1,631,385 1,782,814

Total liabilities 2,171,079 2,219,661 1,706,027 [REDACTED]

Total equity and liabilities 2,100,593 2,236,216 2,437,973 2,520,671

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BALANCE SHEETS OF THE COMPANY

As at As at December 31, March 31, 2018 2019 2020 2021 Notes RMB’000 RMB’000 RMB’000 RMB’000

ASSETS Non-current assets Property, plant and equipment 39(b) 76,759 86,660 102,189 99,588 Right-of-use assets 39(c) 70,816 62,824 59,690 56,537 Investment properties 39(d) 71,600 67,800 64,600 64,500 Prepayments 39(e) 7,993 13,133 2,050 3,110 Investments in subsidiaries 39(a) 30,705 30,705 35,054 35,054 Investments accounted for using the equity method 4,142 13,834 21,212 21,892 Intangible assets 5,503 5,483 10,434 9,688 Deferred income tax assets 30,365 44,425 51,750 55,634

297,883 324,864 346,979 346,003

Current assets Inventories – 1,101 1,814 2,721 Trade and other receivables 39(f) 596,199 641,447 712,480 889,717 Prepayments 39(e) 87,674 57,605 69,644 [REDACTED] Financial assets at fair value through profit or loss 33,028 1,527 31,074 46,105 Payments on behalf of residents 39(g) 69,996 56,316 55,536 57,671 Restricted bank deposits 39(h) 1,324 5,763 9,357 7,990 Cash and cash equivalents 39(h) 370,736 400,183 409,054 274,018 Assets held for sale 39(i) 56,758 134,943 121,825 120,689

1,215,715 1,298,885 1,410,784 [REDACTED]

Total assets 1,513,598 1,623,749 1,757,763 [REDACTED]

EQUITY Share capital 29 68,223 68,223 81,544 81,544 Other reserves 39(j) (458,563) (453,375) 103,954 496 Retained earnings 161,544 194,427 240,414 293,169

Total equity (228,796) (190,725) 425,912 375,209

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As at As at December 31, March 31, 2018 2019 2020 2021 Notes RMB’000 RMB’000 RMB’000 RMB’000

LIABILITIES Non-current liabilities Lease liabilities 39(c) 37,943 23,034 19,011 17,934 Deferred income tax liabilities 12,506 13,494 13,428 13,466

50,449 36,528 32,439 31,400

Current liabilities Trade and other payables 39(k) 702,727 748,586 747,874 939,352 Receipts on behalf of residents 39(g) 128,049 106,387 117,228 124,017 Amounts due to subsidaries 3,018 14,736 91,652 50,255 Contract liabilities 39(l) 119,834 170,560 163,679 116,101 Current income tax liabilities 26,587 31,581 35,160 52,319 Redeemable shares 34 569,358 562,255 – – Borrowings 39(m) 120,000 120,000 120,000 120,000 Lease liabilities 39(c) 22,372 23,841 23,819 23,494

1,691,945 1,777,946 1,299,412 1,425,538

Total liabilities 1,742,394 1,814,474 1,331,851 1,456,938

Total equity and liabilities 1,513,598 1,623,749 1,757,763 1,832,147

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CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

Attributable to owners of the Company Non- Share Other Retained controlling Total Notes capital reserves earnings Total interests equity RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000

Balance at January 1, 2018 78,334 (26,432) 319,326 371,228 7,942 379,170

Comprehensive income Profit for the year – – 69,245 69,245 2,127 71,372 Other comprehensive income 30 – 30,979 – 30,979 – 30,979

Total comprehensive income for the year – 30,979 69,245 100,224 2,127 102,351

Transactions with owners of the Company Transfer to statutory reserves – 9,722 (9,722) – – – Capital injections – 26,309 – 26,309 865 27,174 Dividends 32 – – (111,715) (111,715) (767) (112,482) Effects of transfer of ordinary shares with preference rights to redeemable shares 34 (10,111) (456,588) – (466,699) – (466,699)

Balance at December 31, 2018 68,223 (416,010) 267,134 (80,653) 10,167 (70,486)

Balance at January 1, 2019 68,223 (416,010) 267,134 (80,653) 10,167 (70,486)

Comprehensive income Profit for the year – – 135,344 135,344 (1,182) 134,162 Other comprehensive income 30 – (3,150) – (3,150) – (3,150)

Total comprehensive income for the year – (3,150) 135,344 132,194 (1,182) 131,012

Transactions with owners of the Company Transfer to statutory reserves – 8,338 (8,338) – – – Capital injections ––––4,030 4,030 Dividends 32 – – (46,678) (46,678) (1,323) (48,001)

Balance at December 31, 2019 68,223 (410,822) 347,462 4,863 11,692 16,555

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Attributable to owners of the Company Non- Share Other Retained controlling Total Notes capital reserves earnings Total interests equity RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000

Balance at January 1, 2020 68,223 (410,822) 347,462 4,863 11,692 16,555

Comprehensive income Profit for the year – – 210,012 210,012 (3,446) 206,566 Other comprehensive income 30 – (2,025) – (2,025) – (2,025)

Total comprehensive income for the year – (2,025) 210,012 207,987 (3,446) 204,541

Transactions with owners of the company Transfer to statutory reserves – 10,758 (10,758) – – – Capital injections ––––3,089 3,089 Dividends 32 – – (52,426) (52,426) (977) (53,403) Effects of transfer of redeemable shares to ordinary shares upon termination of preference rights 34 13,321 548,596 – 561,917 – 561,917 Transactions with non-controlling interests ––––(753) (753)

Balance at December 31, 2020 81,544 146,507 494,290 722,341 9,605 731,946

Balance at January 1, 2021 81,544 146,507 494,290 722,341 9,605 731,946

Comprehensive income Profit for the period – – 53,268 53,268 (3,297) 49,971 Other comprehensive income ––––––

Total comprehensive income for the period – – 53,268 53,268 (3,297) 49,971

Transactions with owners of the company Transfer to statutory reserves – 5,798 (5,798) – – – Deemed distribution from business combination under common control 1 – (109,256) – (109,256) – (109,256)

Balance at March 31, 2021 81,544 43,049 541,760 666,353 6,308 672,661

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Attributable to owners of the Company Non- Share Other Retained controlling Total Note capital reserves earnings Total interests equity RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000

(Unaudited) Balance at January 1, 2020 68,223 (410,822) 347,462 4,863 11,692 16,555

Comprehensive income Profit for the period – – 49,920 49,920 (2,828) 47,092 Other comprehensive income 30 – (675) – (675) – (675)

Total comprehensive income for the period – (675) 49,920 49,245 (2,828) 46,417

Transactions with owners of the company Transfer to statutory reserves – 4,746 (4,746) – – – Transactions with non-controlling interests ––––(500) (500)

Balance at March 31, 2020 68,223 (406,751) 392,636 54,108 8,364 62,472

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CONSOLIDATED STATEMENTS OF CASH FLOWS

Three months ended Year ended December 31, March 31, Notes 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Cash flows from operating activities Cash generated from/(used in) operations 35(a) 98,025 193,325 269,726 (70,969) (121,219) Interest received 1,545 1,596 1,540 571 290 Income tax paid (45,779) (55,052) (88,226) (396) (6,676)

Net cash generated from/(used in) operating activities 53,791 139,869 183,040 (70,794) (127,605)

Cash flows from investing activities Purchases of property, plant and equipment (66,276) (57,206) (58,475) (2,636) (1,883) Purchases of intangible assets (4,713) (14,923) (759) – (2,333) Purchases of investment properties – (3,860) (372) – – Proceeds from disposal of property, plant and equipment, intangible assets and investment properties 35(b) 7,967 2,147 15,990 135 15,331 Payments for investments accounted for using the equity method (3,630) (7,370) (3,674) – (2,556) Purchases of financial assets at fair value through profit or loss 3.3 (422,226) (1,114,597) (1,009,219) (530,600) (344,004) Proceeds from disposal of financial assets at fair value through profit or loss 3.3 408,180 1,148,575 981,852 471,132 329,481 Dividends received from joint ventures 333 3,666 3,207 - - Repayments from/(advances to) related parties 5,145 5,089 (24,750) (3,714) (2,623)

Net cash used in investing activities (75,220) (38,479) (96,200) (65,683) (8,587)

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Three months ended Year ended December 31, March 31, Notes 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Cash flows from financing activities Proceeds from borrowings 120,000 120,000 120,000 – – Repayments of borrowings (102,000) (127,850) (124,800) (1,413) (4,250) Capital injections 27,174 4,030 3,089 – – Interest paid (9,106) (8,087) (8,037) (1,909) (1,913) Principal element of lease payments (21,720) (26,980) (28,737) (5,731) (5,248) Dividends paid (112,482) (48,001) (53,403) – – Payments for acquisitions of non-controlling interests in subsidiaries – ~ (753) (500) – Advances from/(repayments to) related parties 1,324 (21,068) (3,719) (3,089) (247)

Net cash used in financing activities (96,810) (107,956) (96,360) (12,642) (11,658)

Net decrease in cash and cash equivalents (118,239) (6,566) (9,520) (149,119) (147,850) Cash and cash equivalents at beginning of the year/period 648,538 530,299 523,733 523,733 514,213

Cash and cash equivalents at end of the year/period 530,299 523,733 514,213 374,614 366,363

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II NOTES TO THE HISTORICAL FINANCIAL INFORMATION

1 GENERAL INFORMATION

Changcheng Property Co., Ltd. (長城物業集團股份有限公司,the“Company”) (formerly known as Shenzhen Changcheng Property Management Company (深圳市長城物業管理公司)) was established in the PRC on April 1, 1993. The address of the Company’s registered office is 9/F and 10/F Tower C2, Bantian International Center, 5 Huancheng South Road, Bantian Street, Longgang District, Shenzhen, Guangdong, PRC.

The Company and its subsidiaries (the “Group”) are principally engaged in the provision of property management services, value-added services to property developers, community value-added services and professional services in the PRC.

As at January 1, 2018, the Company was owned as to approximately 24.29% by Shenzhen Xicheng Ruijia Investment Consultation Partnership (Limited Partnership) (深圳市熙城睿家投資諮詢合夥企業（有限合夥）,“Xicheng Ruijia”), 21.53% by Shenzhen Xicheng Ruihe Investment Consultation Partnership (Limited Partnership) (深圳市熙城睿和投資諮詢合夥企業（有限合夥）,“Xicheng Ruihe”), 14.28% by Shenzhen Xicheng Ruifeng Investment Consultation Partnership (Limited Partnership) (深圳市熙城睿豐投資諮詢合夥企業（有限合夥）,“Xicheng Ruifeng”), 10.49% by Shenzhen Xicheng Ruiying Investment Consultation Partnership (Limited Partnership) (深圳市熙城睿盈投資諮詢合夥企業（有限合夥）,“Xicheng Ruiying”), 21.53% by Shenzhen Centralcon Capital Co., Ltd. (深圳市中洲資本有限公司, “Centralcon Capital”), 5.00% by Nanjing Gaoke Xinjun Chengzhang No.1 Equity Investment Partnership (Limited Partnership) (南京高科新浚成長一期股權投資合夥企業（有限合夥）,“Nanjing Gaoke”), and 2.88% by Shanghai Luyuan Investment Management Center (Limited Partnership) (上海麓源投資管理中心（有限合夥）,“Shanghai Luyuan”), respectively.

On January 22, 2018, Xicheng Ruijia, Xicheng Ruihe, Xicheng Ruifeng, Xicheng Ruiying, Centralcon Capital, Shanghai Luyuan and Chengdu Shengmei Tongying Investment Partnership (Limited Partnership) (成都市盛美同贏投資合夥企業（有限合夥）)(“Shengmei Tongying”) entered into a share purchase agreement, pursuant to which Xicheng Ruijia, Xicheng Ruihe, Xicheng Ruifeng, Xicheng Ruiying, Centralcon Capital and Shanghai Luyuan agreed to transfer approximately 11.34% (of which 2.04% from Xicheng Ruijia, 1.47% from Xicheng Ruihe, 1.72% from Xicheng Ruifeng, 1.19% from Xicheng Ruiying, 2.04% from Centralcon Capital and 2.88% from Shanghai Luyuan, respectively) of the Company’s total share capital in aggregate to Shengmei Tongying at a total consideration of RMB272,074,689. Upon completion of such share purchase, the Company became owned as to approximately 22.14% by Xicheng Ruijia, 19.79% by Xicheng Ruihe, 19.49% by Centralcon Capital, 12.67% by Xicheng Ruifeng, 9.57% by Xicheng Ruiying, 5.00% by Nanjing Gaoke and 11.34% by Shengmei Tongying, respectively.

On March 2, 2018, Nanjing Gaoke and Shengmei Tongying entered into a share purchase agreement, pursuant to which Nanjing Gaoke agreed to transfer its entire 5% of the Company’s total share capital to Shengmei Tongying at a consideration of RMB128,400,000. Upon completion of such share purchase, the Company became owned as to approximately 22.14% by Xicheng Ruijia, 19.79% by Xicheng Ruihe, 19.49% by Centralcon Capital, 16.34% by Shengmei Tongying, 12.67% by Xicheng Ruifeng and 9.57% by Xicheng Ruiying.

During the Track Record Period, the Company was ultimately controlled by Mr. Chen Yaozhong (陳耀忠), Mr. Liang Zhijun (梁志軍), Mr. Lv Yuhua (呂雨華) and Mr. Ma Xingwen (馬興文) together with the limited partnerships controlled by them through acting as the general partner, namely Xicheng Ruijia, Xicheng Ruihe, Xicheng Ruifeng and Xicheng Ruiying (the “Ultimate Controlling Shareholders”).

On March 15, 2021, the Ultimate Controlling Shareholders executed an acting in concert agreement (the “Acting in Concert Agreement”), pursuant to which the Ultimate Controlling Shareholders had agreed and confirmed, among other things, from March 2016 (which was the time when they became the beneficial owners of the Company) by acting as the general partners or limited partners, as the case may be, in Xicheng Ruifeng, Xicheng Ruihe, Xicheng Ruijia, Xicheng Ruiying and any other future entities controlled by the Ultimate Controlling Shareholders, that they had been and would continue to be parties acting in concert.

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On March 25, 2021, the Company entered into a share purchase agreement with Shenzhen Changcheng Jiaye Investment Co., Ltd. (“Changcheng Jiaye”) and its immediate holding company, Shenzhen Jiaye Investment Holdings Co., Ltd. (深圳市嘉業投資控股有限公司)(“Shenzhen Jiaye Investment”), pursuant to which Changcheng Jiaye agreed to transfer its 100% equity interest in a subsidiary, Foshan Shunde Chengji Ruishang Real Estate Co., Ltd. (“Foshan Chengji Ruishang”) to the Company at a consideration of RMB109,256,000 (the “Share Transfer”). As at March 31, 2021, the Share Transfer was completed as the preconditions of completion agreed in the share purchase agreement were substantially fulfilled. Upon completion of the Share Transfer, Foshan Chengji Ruishang became a wholly-owned subsidiary of the Company. As the general and limited partners of Xicheng Ruijia, Xicheng Ruihe, Xicheng Ruifeng and Xicheng Ruiying also jointly control Shenzhen Jiaye Investment, the Share Transfer was accounted for as a business combination under common control. The financial statements of Foshan Chengji Ruishang were consolidated using their existing book values, as if Foshan Chengji Ruishang had been consolidated from the date when it first came under the control of the Company during the Track Record Period. The cash consideration payable or paid was regarded as a deemed distribution to the equity holders of the Company (Note 30).

2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

This note provides a list of significant accounting policies adopted in the preparation of the Historical Financial Information as set out below. These policies have been consistently applied to all the years and periods presented, unless otherwise stated. The Historical Financial Information is for the Group consisting of the Company and its subsidiaries.

2.1 Basis of preparation

The Historical Financial Information of the Company has been prepared in accordance with principal accounting policies as set out below which are in accordance with Hong Kong Financial Reporting Standards (“HKFRS”) issued by the HKICPA. The Historical Financial Information has been prepared on a historical cost basis, except for the following:

• certain financial assets, investment properties and redeemable shares measured at fair value;

The preparation of Historical Financial Information in conformity with HKFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgment in the process of applying the Group’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the Historical financial information are disclosed in Note 4.

(a) New and amended standards adopted by the Group

All effective standards, amendments to standards and interpretations of HKFRS, which are mandatory for the financial year beginning on January 1, 2021, are consistently applied to the Group for the Track Record Period.

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(b) New and amended standards not yet adopted

Up to the date of issuance of this report, the HKICPA has issued the following new standards and amendments to existing standards which are not yet effective and have not been early adopted by the Group during the Track Record Period:

Effective for annual periods beginning on or after

Amendments to HKFRS 3 Reference to the conceptual January 1, 2022 framework Amendments to HKAS 16 Property, plant and January 1, 2022 equipment: proceeds before intended use Amendments to HKAS 37 Onerous contract: cost of January 1, 2022 fulfilling a contract Accounting Guideline 5 (Revised) Merger accounting for January 1, 2022 common control combinations Amendments to HKAS 1 Classification of liabilities as January 1, 2023 current or non-current Annual improvements project Annual improvements January 1, 2023 2018-2020 cycle HK Interpretation 5 (2020) Presentation of financial January 1, 2023 statements — classification by the borrower of a term loan that contains a repayment on demand clause Amendments to HKFRS 10 Sale or contribution of assets To be determined and HKAS 28 between an investor and its associates or joint ventures

The Group has already commenced an assessment of the impact of these new or revised standards, and amendments, certain of which are relevant to the Group’s operations. According to the preliminary assessment made by the directors, no significant impact on the financial performance and position of the Group is expected when they become effective.

2.2 Principles of consolidation and equity accounting

2.2.1 Subsidiaries

A subsidiary is an entity (including a structured entity) over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases.

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The accounting policies for business combinations by the Group are disclosed in Note 2.3.

Intercompany transactions, balances and unrealized gains on transactions between group companies are eliminated. Unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the transferred asset. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.

Non-controlling interests in the results and equity of subsidiaries are shown separately in the consolidated statement of comprehensive income, consolidated statement of changes in equity and balance sheet respectively.

2.2.2 Joint arrangements

Under HKFRS 11 “Joint Arrangements”, investments in joint arrangements are classified as either joint operations or joint ventures. The classification depends on the contractual rights and obligations of each investor, rather than the legal structure of the joint arrangement. The Group has joint ventures.

Interests in joint ventures are accounted for using the equity method (see Note 2.2.3 below), after initially being recognized at cost in the consolidated balance sheet.

2.2.3 Equity method

Under the equity method of accounting, the investments are initially recognized at cost and adjusted thereafter to recognize the Group’s share of the post-acquisition profits or losses of the investee in profit or loss, and the Group’s share of movements in other comprehensive income of the investee in other comprehensive income. Dividends received or receivable from joint ventures are recognized as a reduction in the carrying amount of the investment.

Where the Group’s share of losses in an equity-accounted investment equals or exceeds its interest in the entity, including any other unsecured long-term receivables, the Group does not recognize further losses, unless it has incurred obligations or made payments on behalf of the other entity.

Unrealized gains on transactions between the Group and its joint ventures are eliminated to the extent of the Group’s interest in these entities. Unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of equity-accounted investees have been changed where necessary to ensure consistency with the policies adopted by the Group.

The carrying amount of equity-accounted investments is tested for impairment in accordance with the policy described in Note 2.12.

2.2.4 Changes in ownership interests

The Group treats transactions with non-controlling interests that do not result in a loss of control as transactions with equity owners of the Group. A change in ownership interest results in an adjustment between the carrying amounts of the controlling and non-controlling interests to reflect their relative interests in the subsidiary. Any difference between the amount of the adjustment to non-controlling interests and any consideration paid or received is recognized in a separate reserve within equity attributable to owners of the Company.

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When the Group ceases to consolidate or equity account for an investment because of a loss of control, joint control or significant influence, any retained interest in the entity is remeasured to its fair value with the change in carrying amount recognized in profit or loss. This fair value becomes the initial carrying amount for the purposes of subsequently accounting for the retained interest as an associate, joint venture or financial asset. In addition, any amounts previously recognized in other comprehensive income in respect of that entity are accounted for as if the Group had directly disposed of the related assets or liabilities. This may mean that amounts previously recognized in other comprehensive income are reclassified to profit or loss or transferred to another category of equity as specified/permitted by applicable HKFRSs.

If the ownership interest in a joint venture or an associate is reduced but joint control or significant influence is retained, only a proportionate share of the amounts previously recognized in other comprehensive income are reclassified to profit or loss where appropriate.

2.3 Business combinations

(a) Business combinations under common control

The Historical Financial Information incorporates the financial statement items of the entities of businesses in which the common control combination occurs as if they had been consolidated from the date when the entities of businesses first came under the control of the controlling party.

The net assets of the combining entities or businesses are consolidated using the existing book values from the controlling party’s perspective. No amount is recognized in consideration for goodwill or excess of acquirer’s interest in the net fair value of acquiree’s identifiable assets, liabilities and contingent liabilities over cost at the time of common control combination, to the extent of the continuation of the controlling party’s interest.

The consolidated statements of comprehensive income includes the results of each of the combining entities or businesses from the earliest date presented or since the date when the combining entities or businesses first came under the common control, where this is a shorter period, regardless of the date of the common control combination.

A uniform set of accounting policies is adopted by those entities. All intra-group transitions, balances and unrealized gains on transactions between combining entities or business are eliminated.

(b) Business combinations not under common control

The acquisition method of accounting is used to account for all business combinations not under common control, regardless of whether equity instruments or other assets are acquired. The consideration transferred for the acquisition of a subsidiary comprises the:

• fair values of the assets transferred

• liabilities incurred to the former owners of the acquired business

• equity interests issued by the Group

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• fair value of any asset or liability resulting from a contingent consideration arrangement, and

• fair value of any pre-existing equity interest in the subsidiary.

Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are, with limited exceptions, measured initially at their fair values at the acquisition date. The Group recognizes any non-controlling interest in the acquired entity on an acquisition-by-acquisition basis either at fair value or at the non-controlling interest’s proportionate share of the acquired entity’s net identifiable assets.

Acquisition-related costs are expensed as incurred.

The excess of the:

• consideration transferred,

• amount of any non-controlling interest in the acquired entity, and

• acquisition-date fair value of any previous equity interest in the acquired entity

over the fair value of the net identifiable assets acquired is recorded as goodwill. If those amounts are less than the fair value of the net identifiable assets of the business acquired, the difference is recognized directly in profit or loss as a bargain purchase.

Where settlement of any part of cash consideration is deferred, the amounts payable in the future are discounted to their present value as at the date of exchange. The discount rate used is the entity’s incremental borrowing rate, being the rate at which a similar borrowing could be obtained from an independent financier under comparable terms and conditions. Contingent consideration is classified either as equity or a financial liability. Amounts classified as a financial liability are subsequently remeasured to fair value with changes in fair value recognized in profit or loss.

If the business combination is achieved in stages, the acquisition date carrying value of the acquirer’s previously held equity interest in the acquiree is remeasured to fair value at the acquisition date. Any gains or losses arising from such remeasurement are recognized in profit or loss.

2.4 Separate financial statements

Investments in subsidiaries are accounted for at cost less impairment. Cost includes direct attributable costs of investment. The results of subsidiaries are accounted for by the Company on the basis of dividend received and receivable.

Impairment testing of the investments in subsidiaries is required upon receiving a dividend from these investments if the dividend exceeds the total comprehensive income of the subsidiary in the period the dividend is declared or if the carrying amount of the investment in the separate financial statements exceeds the carrying amount of the investee’s net assets including goodwill in the historical financial information.

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2.5 Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker (“CODM”). The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the executive directors of the Company.

2.6 Foreign currency translation

2.6.1 Functional and presentation currency

Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (“the functional currency”). Since all of the assets and operations of the Group are located in the PRC, the historical financial information are presented in RMB, which is the Company’s functional and the Group’s presentation currency.

2.6.2 Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation where items are re-measured. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognized in the consolidated statements of comprehensive income within “other gains/(losses) – net”.

2.7 Leases

The Group as lessor under finance leases

The Group as lessor under operating leases

Lease income from operating leases where the Group is a lessor is recognized as income on a straight-line basis over the lease term. Initial direct costs incurred in obtaining an operating lease are added to the carrying amount of the underlying asset and recognized as expense over the lease term on the same basis as lease income. The respective leased assets are included in the balance sheet based on their nature.

The Group as lessee

Leases are recognized as a right-of-use asset and a corresponding liability at the date at which the leased asset is available for use by the Group.

Contracts may contain both lease and non-lease components. The Group allocates the consideration in the contract to the lease and non-lease components based on their relative stand-alone prices.

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Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include the net present value of the following lease payments:

− fixed payments(including in-substance fixed payments), less any lease incentives receivable

− variable lease payment that are based on an index or a rate

− amounts expected to be payable by the lessee under residual value guarantees

− the exercise price of a purchase option if the lessee is reasonably certain to exercise that option, and

− payments of penalties for terminating the lease, if the lease term reflects the lessee exercising that option

Lease payments to be made under reasonably certain extension options are also included in the measurement of the liability.

The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be readily determined, which is generally the case for leases in the Group, the lessee’s incremental borrowing rate is used, being the rate that the individual lessee would have to pay to borrow the funds necessary to obtain an asset of similar value to the right-of-use asset in a similar economic environment with similar terms, security and conditions.

To determine the incremental borrowing rate, the Group:

• where possible, uses recent third-party financing received by the individual lessee as a starting point, adjusted to reflect changes in financing conditions since third-party financing was received

• uses a build-up approach that starts with a risk-free interest rate adjusted for credit risk for leases held by the Group, which does not have recent third-party financing, and

• makes adjustments specific to the lease, eg term, country, currency and security

If a readily observable amortizing loan rate is available to the individual lessee (through recent financing or market data) which has a similar payment profile to the lease, then the Group entities use that rate as a starting point to determine the incremental borrowing rate.

The Group is exposed to potential future increases in variable lease payments based on an index or rate, which are not included in the lease liability until they take effect. When adjustments to lease payments based on an index or rate take effect, the lease liability is reassessed and adjusted against the right-of-use asset.

Lease payments are allocated between principal and finance cost. The finance cost is charged to profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period.

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Right-of-use assets are measured at cost comprising the following:

– the amount of the initial measurement of lease liability

− any lease payments made at or before the commencement date less any lease incentives received

− any initial direct costs, and

− restoration costs

Right-of-use assets are generally depreciated over the shorter of the asset’s useful life and the lease term on a straight-line basis. If the Group is reasonably certain to exercise a purchase option, the right-of-use asset is depreciated over the underlying asset’s useful life.

2.8 Property, plant and equipment

Property, plant and equipment are stated at historical cost less depreciation and accumulated impairment. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the asset will flow to the Group and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognized. All other repairs and maintenance are charged to the consolidated statements of comprehensive income during the periods in which they are incurred.

Depreciation is calculated using the straight-line method to allocate their cost, net of their residual values, over their estimated useful lives or, in the case of leasehold improvements and certain leased plant and equipment, the shorter lease term as follows:

Buildings 30 years Machinery 10 years Motor vehicles 10 years Leasehold improvements 5 years Electronic equipment 3-5 years

The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each reporting date.

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount (Note 2.12).

Gains and losses on disposal are determined by comparing the proceeds with the carrying amounts. These are included in “Other gains/(losses) – net” in the consolidated statements of comprehensive income.

Construction-in-progress (the “CIP”) represents buildings under construction and is stated at cost less accumulated impairment loss, if any. No provision for depreciation is made on CIP until such time as the relevant assets are completed and ready for intended use. When the assets concerned are available for use, the costs are transferred to relevant categories of property, plant and equipment and depreciated in accordance with the policy as stated above.

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2.9 Investment properties

Investment properties, principally comprising buildings, are held for long-term rental and that are not occupied by the Group. Investment properties are initially measured at cost, including related transaction costs and where applicable borrowing costs. After initial recognition, investment properties are carried at fair value. Changes in fair values are recorded in profit or loss as part of “other gains/(losses) – net”.

If an item of owner-occupied property becomes an investment property because its use has changed, any difference resulting between the carrying amount and the fair value of this item at the date of transfer is treated in the same way as a revaluation under HKAS 16. Any resulting increase in the carrying amount of the property is recognized in profit or loss to the extent that it reverses a previous impairment loss, with any remaining increase recognized in other comprehensive income and increase directly to equity in revaluation surplus within equity. Any resulting decrease in the carrying amount of the property is initially charged in other comprehensive income against any previously recognized revaluation surplus, with any remaining decrease charged to profit or loss.

For a transfer from investment property carried at fair value to owner-occupied property, the property’s deemed cost for subsequent accounting shall be its fair value at the date of change in use.

2.10 Intangible assets

2.10.1 Software

2.10.2 Research and development

Research expenditure is recognized as expenses as incurred. Development costs that are directly attributable to the design and testing of identifiable and unique intangible asset controlled by the Group are recognized as intangible assets when the following criteria are met:

− it is technically feasible to complete the intangible asset so that it will be available for use;

− management intends to complete the intangible asset and use or sell it;

− there is an ability to use or sell the intangible asset;

− it can be demonstrated how the intangible asset will generate probable future economic benefits;

− adequate technical, financial and other resources to complete the development and to use or sell the intangible asset are available; and

− the expenditure attributable to the intangible asset during its development can be reliably measured.

Directly attributable costs that are capitalized as part of the intangible asset include employee costs and an appropriate portion of relevant overheads. Capitalized development costs are recorded as intangible assets and amortized from the point at which the asset is ready for use.

Other development expenditures that do not meet those criteria are recognized as expenses as incurred. Development costs previously recognized as expenses are not recognized as an asset in a subsequent period.

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During the Track Record Period, there were no development costs meeting these criteria and capitalized as intangible assets.

2.11 Assets held for sale

2.12 Impairment of non-financial assets

Goodwill and intangible assets that have an indefinite useful life are not subject to amortization and are tested annually for impairment, or more frequently if events or changes in circumstances indicate that they might be impaired. Other assets that are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognized for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs of disposal and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows which are largely independent of the cash inflows from other assets or groups of assets (CGUs). Non-financial assets, except for goodwill, that suffered an impairment are reviewed for possible reversal of the impairment at each reporting date.

2.13 Financial assets

(i) Classification

The Group classifies its financial assets in the following measurement categories:

− Those to be measured subsequently at fair value (either through other comprehensive income, or through profit or loss), and

− Those to be measured at amortized cost.

The classification depends on the entity’s business model for managing the financial assets and the contractual terms of the cash flows.

See Note 23 for details about each type of financial assets.

The Group reclassifies debt investments when and only when its business model for managing those assets changes.

(ii) Recognition and derecognition

Regular way purchases and sales of financial assets are recognized on trade-date, the date on which the Group commits to purchase or sell the asset. Financial assets are derecognized when the rights to receive cash flows from the financial assets have expired or have been transferred and the Group has transferred substantially all the risks and rewards of ownership.

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(iii) Measurement

At initial recognition, the Group measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value through profit or loss are expensed in profit or loss.

Financial assets with embedded derivatives are considered in their entirety when determining whether their cash flows are solely payment of principal and interest.

Debt instruments

Subsequent measurement of debt instruments depends on the Group’s business model for managing the asset and the cash flow characteristics of the asset. There are three measurement categories into which the Group classifies its debt instruments:

• Amortized cost: Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortized cost. A gain or loss on a debt investment that is subsequently measured at amortized cost and is not part of a hedging relationship is recognized in profit or loss when the asset is derecognized or impaired. Interest income from these financial assets is included in finance income using the effective interest rate method.

• Fair value through other comprehensive income (“FVOCI”): Assets that are held for collection of contractual cash flows and for sale, where the assets’ cash flows represent solely payments of principal and interest, are measured at FVOCI. Movements in the carrying amount are taken through other comprehensive income (“OCI”), except for the recognition of impairment gains or losses, interest revenue and foreign exchange gains and losses which are recognized in profit or loss. When the financial asset is derecognized, the cumulative gain or loss previously recognized in OCI is reclassified from equity to profit or loss and recognized in other gains/(losses)-net. Interest income from these financial assets is included in finance income using the effective interest rate method. Foreign exchange gains and losses are presented in other gains/(losses)-net and impairment expenses in other expenses.

• Fair value through profit or loss (“FVPL”): Assets that do not meet the criteria for amortized cost or FVOCI are measured at fair value through profit or loss. A gain or loss on a debt investment that is subsequently measured at fair value through profit or loss and is not part of a hedging relationship is recognized in profit or loss and presented net in the consolidated statements of comprehensive income within other gains/(losses)-net in the period in which it arises.

Equity instruments

The Group subsequently measures all equity investments at fair value. Where the Group’s management has elected to present fair value gains and losses on equity investments in OCI, there is no subsequent reclassification of fair value gains and losses to profit or loss following the derecognition of the investment. Dividends from such investments continue to be recognized in profit or loss as other income when the Group’s right to receive payments is established.

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Changes in the fair value of financial assets at FVPL are recognized in other gains/(losses) in the consolidated statements of comprehensive income as applicable. Impairment losses (and reversal of impairment losses) on equity investments measured at FVOCI are not reported separately from other changes in fair value.

(iv) Impairment

The Group assesses on a forward-looking basis the expected credit losses associated with its debt instruments carried at amortized cost and FVOCI. The impairment methodology applied depends on whether there has been a significant increase in credit risk.

For trade receivables, the Group applies the simplified approach permitted by HKFRS 9, which requires expected lifetime losses to be recognized from initial recognition of the receivables, see Note 3.1.2 for further details.

2.14 Offsetting financial instruments

Financial assets and liabilities are offset and the net amount reported in the consolidated balance sheets where the Group currently has a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis or realize the asset and settle the liability simultaneously.

2.15 Inventories

Inventories are stated at the lower of cost and net realizable value. Cost is determined using the weighted average method. Net realizable value is the estimated selling price in the ordinary course of business, less applicable variable selling expenses.

2.16 Trade and other receivables

Trade receivables are amounts due from customers for services performed in the ordinary course of business. If collection of trade and other receivables is expected in one year or less (or in the normal operating cycle if longer), they are classified as current assets. If not, they are presented as non-current assets.

Trade receivables are recognized initially at the amount of consideration that is unconditional unless they contain significant financing components, when they are recognized at fair value. The Group holds the trade receivables with the objective of collecting the contractual cash flows and therefore measures them subsequently at amortized cost using the effective interest method. A description of the Group’s impairment policies is disclosed in Note 3.1.2.

2.17 Cash and cash equivalents

For the purpose of presentation in the consolidated statement of cash flows, cash and cash equivalents includes cash at bank and in hand, and term deposits with financial institutions that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

2.18 Share capital

Ordinary shares are classified as equity.

Incremental costs directly attributable to the issue of new shares are shown in equity as a deduction, net of tax, from the proceeds.

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2.19 Trade and other payables

Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Trade payables are classified as current liabilities if payment is due within one year (or in the normal operating cycle of the business if longer). If not, they are presented as non-current liabilities.

Trade payables and other payables are recognized initially at fair value and subsequently measured at amortized cost using the effective interest method.

2.20 Borrowings

Brrowings are initially recognized at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortized cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognized in profit or loss over the period of the borrowings using the effective interest method. Fees paid on the establishment of loan facilities are recognized as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is deferred until the draw down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn down, the fee is capitalized as a prepayment for liquidity services and amortized over the period of the facility to which it relates.

Borrowings are removed from the balance sheet when the obligation specified in the contract is discharged, cancelled or expired. The difference between the carrying amount of a financial liability that has been extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognized in profit or loss as finance costs.

Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the reporting period.

2.21 Borrowing costs

General and specific borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset are capitalized during the period of time that is required to complete and prepare the asset for its intended use or sale. Qualifying assets are assets that necessarily take a substantial period of time to get ready for their intended use or sale.

Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalization.

Other borrowing costs are expensed in the period in which they are incurred.

2.22 Redeemable shares

Redeemable shares represent those ordinary shares with preference rights such as redemption rights and anti-dilution rights, details of which are set out in Note 34.

The Group designated the redeemable shares as financial liabilities at FVPL. They were initially recognized at fair value. Any directly attributable transaction costs were recognized as finance costs in profit or loss. Subsequent to initial recognition, the redeemable shares were measured at fair value with fair value changes being charged or credited to profit or loss. When the ordinary shares with preference rights were transferred to redeemable shares, the excess of the fair value of redeemable shares as at the date of such transfer over the nominal value of the ordinary share capital was debited to capital reserves. When the redeemable shares were transferred back to ordinary shares upon the termination of the preference rights, the excess of the fair value of redeemable shares as at the date of such transfer over the nominal value of the ordinary share capital was credited to capital reserves..

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2.23 Current and deferred income tax

The income tax expense or credit for the period is the tax payable or recoverable on the current period’s taxable income based on the applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to unused tax losses.

2.23.1 Current income tax

The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the reporting dates in the countries where the Company’s subsidiaries operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation and considers whether it is probable that a taxation authority will accept an uncertain tax treatment. The Group measures its tax balances either based on the most likely amount or the expected value, depending on which method provides a better prediction of the resolution of the uncertainty.

2.23.2 Deferred income tax

Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the historical financial information. However, deferred tax liabilities are not recognized if they arise from the initial recognition of goodwill, the deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates(and laws) that have been enacted or substantively enacted by the end of each reporting period and are expected to apply when the related deferred income tax asset is realized or the deferred income tax liability is settled.

Deferred income tax assets are recognized only if it is probable that future taxable amounts will be available to utilize those temporary differences and losses.

Deferred tax liabilities and assets are not recognized for temporary differences between the carrying amount and tax bases of investments in foreign operations where the Group is able to control the timing of the reversal of the temporary differences and it is probable that the differences will not reverse in the foreseeable future.

Deferred tax assets and liabilities are offset where there is a legally enforceable right to offset current tax assets and liabilities and where the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.

Current and deferred tax is recognized in profit or loss, except to the extent that it relates to items recognized in other comprehensive income or directly in equity. In this case, the tax is also recognized in other comprehensive income or directly in equity, respectively.

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2.24 Employee benefits

2.24.1 Pension obligations

In accordance with the rules and regulations in the PRC, the employees of the Group based in the PRC participate in various defined contribution retirement benefit plans organized by the relevant municipal and provincial governments in the PRC under which the Group and the employees are required to make monthly contributions to these plans calculated as a percentage of the employees’ salaries, subject to certain ceiling. The municipal and provincial governments undertake to assume the retirement benefit obligations of all existing and future retired employees based in the PRC payable under the plans described above. Other than the monthly contributions, the Group has no further obligation for the payment of retirement and other post retirement benefits of its employees. The assets of these plans are held separately from those of the Group in an independent fund managed by the PRC government. The Group’s contributions to these plans are expensed as incurred.

2.24.2 Housing funds, medical insurances and other social insurances

The employees of the Group based in the PRC are entitled to participate in various government-supervised housing funds, medical insurance and other employee social insurance plan. The Group contributes on a monthly basis to these funds based on certain percentages of the salaries of the employees, subject to certain ceiling. The Group’s liability in respect of these funds is limited to the contributions payable in each period. Contributions to these funds are expensed as incurred.

2.24.3 Short-term obligations

Liabilities for wages and salaries, including non-monetary benefits and accumulated sick leave that are expected to be settled wholly within 12 months after the end of the period in which the employees rendered the related service are recognized in respect of employees’ services up to the end of the reporting period and are measured at the amounts expected to be paid when the liabilities are settled. The liabilities are presented as current employee benefit obligations in the consolidated statements of financial position.

2.25 Provisions

Provisions are recognized when: the Group has a present legal or constructive obligation as a result of past events; it is probable that an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated. Provisions are not recognized for future operating losses.

Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognized even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be small.

Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation. The increase in the provisions due to passage of time is recognized as interest expense.

2.26 Revenue recognition

The Group provides property management services, value-added services to property developers, community value-added services and professional services. Revenue is recognized when the control of services is transferred to the customers. Depending on the terms of the contracts and the laws that apply to the contract, control of services may be transferred over time or at a point in time.

The Group distinguishes whether the Group is a principal or an agent in the transactions with its customers. When the Group is acting as a principal, the associated revenue is recognized in gross amount and when the Group is acting as an agent, the associated revenue is recognized in net amount.

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(a) Property management services

The Group provides property owners, residents and tenants and property developers with a wide range of property management services, which primarily comprise cleaning, security, greening and landscaping and repair and maintenance services. The Group bills a fixed amount for services provided on a monthly, quarterly or annually basis and recognizes as revenue in the amount to which the Group has a right to bill and that corresponds directly with the value of performance completed. The Group primarily generates revenue from property management services income from properties managed under lump sum basis, the Group entitles to revenue at the value of property management services fee received or receivable.

For property management services income from properties managed under commission basis, the Group recognizes the commission, which is calculated by pre-determined percentage of the total property management fee received or receivable from the customers, as its revenue for arranging and monitoring the services as an agent.

(b) Value-added services to property developers

Value-added services to property developers primarily consist of sales office management services. The Group provides property management services to sales offices and display units for property developers, such as security services, cleaning services and reception services. The Group typically charges a fixed monthly fee for the sales office management services, taking into consideration factors such as the nature and scope of the services, the headcount and positions of the staff the Group deploy and the size and location of the properties involved. Revenues from value-added services to property developers are recognized when the Group agrees the price for these services with the customers upfront and issues monthly bills to the customers.

The Group provides a wide range of community value-added services to property owners, residents, tenants and property developers, including: (i) space management services, which mainly include: leasing spaces in elevators and parking garages, exterior walls and other advertising spaces to third-party vendors; leasing certain common areas on behalf of property owners as venues for public activities and providing inspection and security services for property owners’ home decoration and construction work. Revenues from space management services are recognized over time according to the services rendered; (ii) community shopping services. The Group intends to maximize convenience and provides an enjoyable life to residents by offering platform for online shopping. The Group acts as an agent and charges a commission fee based on the scale of commodities being purchased. The Group recognizes such commission fee as revenue when the purchased commodities are delivered and the services are rendered; (iii) home-living services, which mainly include residential decoration and furnishing services, catering services, featured services and construction material and furniture sale services. For those home-living services other than construction material and furniture sale services, revenues are recognized over time according to the services rendered. For construction material and furniture sale services, the Group acts as an agent and charges a commission fee based on the scale of commodities being purchased, the revenue of which is recognized when the purchased commodities are delivered and the services are rendered; and (iv) car parks management services. The Group provides car parks management and operation services to property developers, property owners, tenants and residents with regard to certain car park spaces. The Group typically charges a certain percentage of the operating income generated from the car parks under management as service fee. Revenues from car parks management services are recognized over time according to the services rendered.

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(d) Professional services

The Group provides various professional services to property developers, property owners, property management companies, government agencies, transportation hubs and other companies with elevator related businesses, including: (i) construction and installation engineering services; (ii) elevator related services; and (iii) smart integrated operation platform services. Revenues from professional services are recognized over time according to the services rendered.

Contract assets and liabilities

When either party to a contract has performed, the Group presents the contract in the balance sheet as a contract asset or a contract liability, depending on the relationship between the Group’s performance and the customer’s payment.

A contract asset is the Group’s right to consideration in exchange for services that the Group has transferred to a customer. Incremental costs incurred to obtain a contact, if recoverable, are capitalized and presented as assets and subsequently amortized when the related revenue is recognized.

If a customer pays consideration or the Group has a right to an amount of consideration that is unconditional, before the Group transfers services to the customer, the Group presents the contract as a contract liability when the payment is received or a receivable is recorded (whichever is earlier). A contract liability is the Group’s obligation to transfer services to a customer for which the Group has received consideration (or an amount of consideration is due) from the customer.

2.27 Interest income

Interest income is recognized using the effective interest method. When a receivable is impaired, the Group reduces the carrying amount to its recoverable amount, being the estimated future cash flow discounted at the original effective interest rate of the instrument, and continues unwinding the discount as interest income. Interest income on impaired loans is recognized using the original effective interest rate.

2.28 Dividends distribution

Dividend distribution to the shareholders is recognized as a liability in the Historical Financial Information in the period in which the dividends are approved by the entities’ shareholders or directors, where appropriate.

2.29 Government grants

Grants from the government are recognized at their fair value where there is a reasonable assurance that the grant will be received and the Group will comply with all attached conditions.

Government grants relating to costs are deferred and recognized in the consolidated statements of comprehensive income over the period necessary to match them with the costs that they are intended to compensate. Government grants relating to property and equipment, and other non-current assets are included in the current liabilities and are credited to consolidated statements of comprehensive income on a straight- line basis over the expected lives of the related assets.

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3 FINANCIAL RISK MANAGEMENT

3.1 Financial risk factors

The Group’s activities expose it to a variety of financial risks: market risk (including cash flow and fair value interest rate risks), credit risk and liquidity risk. The Group’s overall risk management program focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on the Group’s financial performance. Risk management is carried out by the senior management of the Group.

3.1.1 Market risk

(i) Interest rate risk

The Group is exposed to fair value interest rate risk in relation to fixed rate bank borrowings. The Group is also exposed to cash flow interest rate risk in relation to variable-rate bank balances and bank borrowings. Management monitors interest rate exposure and will consider hedging significant interest rate exposure should the need arises. The directors of the Company consider that the fair value interest rate risk and cash flow interest rate risk are insignificant.

3.1.2 Credit risk

The Group is exposed to credit risk in relation to its trade and other receivables, payments on behalf of residents, restricted bank deposits, cash and cash equivalents, and financial assets at FVPL. The carrying amounts of trade and other receivables, payments on behalf of residents, restricted bank deposits, cash and cash equivalents and financial assets at fair value through profit or loss represent the Group’s maximum exposure to credit risk in relation to financial assets.

(i) Risk management

The Group manages the credit risk of cash and cash equivalents, restricted bank deposits and wealth management products (classified as financial assets at FVPL) by transacting with state-owned financial institutions and reputable commercial banks which are all high-credit-quality financial institutions in the PRC.

For trade receivables, the Group has large number of customers and there was no concentration of credit risk. The Group has monitoring procedures to ensure that follow-up action is taken to recover overdue debts. In addition, the Group reviews the recoverability of these receivables at the end of each reporting period during the Track Record Period to ensure that adequate impairment losses are made for irrecoverable amounts.

For other receivables and payments on behalf of residents, the Group makes periodic collective assessment as well as individual assessment on the recoverability of these receivables based on historical settlement records and past experience. The directors of the Company consider that there is no material credit risk inherent in the Group’s outstanding balances of other receivables and payments on behalf of residents.

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(ii) Impairment

The Group considers the probability of default upon initial recognition of asset and whether there has been a significant increase in credit risk on an ongoing basis throughout each reporting period. To assess whether there is a significant increase in credit risk the Group compares the risk of a default occurring on the asset as at the reporting date with the risk of default as at the date of initial recognition. It considers available forwarding-looking information. Especially the following indicators are incorporated:

• internal credit rating

• external credit rating

• actual or expected significant adverse changes in business, financial or economic conditions that are expected to cause a significant change to the individual property developers’ and customers’ ability to meet its obligations

• actual or expected significant changes in the operating results of individual property developers

• significant changes in the expected performance and behavior of customers

Financial assets are written off when there is no reasonable expectation of recovery, such as a debtor failing to engage in a repayment plan with the Group.

A summary of the assumptions underpinning the Group’s expected credit losses (“ECL”) model, except for the trade receivables which apply the simplified approach, is as follows:

Group definition of Basis for recognition of Category category ECL provision

Performing Customers have a low risk of 12 months expected losses. default and a strong capacity Where the expected to meet contractual cash lifetime of an asset is less flows than 12 months, expected losses are measured at its expected lifetime (Stage 1)

Underperforming Receivables for which there Lifetime expected losses is a significant increase in (Stage 2) credit risk; as significant increase in credit risk is presumed if interest and/or principal repayments are past due

Non-performing Interest and principal Lifetime expected losses repayments are 365 days past (Stage 3) due

The Group accounts for its credit risk by appropriately providing for expected credit losses on a timely basis. In calculating the expected credit loss rates, the Group considers historical loss rates for each category of receivables and adjusts for forward looking macroeconomic data.

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Cash deposits at banks and wealth management products

The Group expects that there is no significant credit risk associated with cash deposits at banks and wealth management products since they are substantially deposited at or purchased from banks with high credit rating. Management does not expect that there will be any significant losses from non-performance by these counterparties.

Trade receivables

The Group applies the simplified approach to provide for expected credit losses prescribed by HKFRS 9, which permits the use of the lifetime expected loss provision for trade receivables. To measure the expected credit losses, trade and notes receivable have been grouped based on shared credit risk characteristics and aging. The expected credit losses also incorporate forward looking information on macroeconomic factors affecting the ability of the customers to settle the receivables. The Group has identified the trade balance percent of GDP and the wholesale price index to be the most relevant factors, and accordingly adjusts the historical loss rates based on expected changes in these factors.

The loss allowance provision for the trade receivables balance was determined as follows:

As at December 31, 2018 Up to 1 1to2 2to3 3to4 4to5 Over 5 year years years years years years Total

Expected loss rate 1.79% 10.62% 29.05% 43.62% 62.98% 100.00% Gross carrying amount – trade receivables (RMB’000) 377,091 160,209 82,283 52,898 35,100 29,421 737,002

Loss allowance (RMB’000) 6,735 17,017 23,900 23,072 22,106 29,421 122,251

As at December 31, 2019 Up to 1 1to2 2to3 3to4 4to5 Over 5 year years years years years years Total

Expected loss rate 2.26% 14.04% 34.99% 53.79% 78.78% 100.00% Gross carrying amount – trade receivables (RMB’000) 405,425 159,005 93,607 61,475 41,878 50,237 811,627

Loss allowance (RMB’000) 9,167 22,327 32,749 33,066 32,991 50,237 180,537

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As at December 31, 2020 Up to 1 1to2 2to3 3to4 4to5 Over 5 year years years years years years Total

Expected loss rate 1.93% 12.95% 30.39% 47.40% 70.19% 100.00% Gross carrying amount – trade receivables (RMB’000) 383,641 236,723 93,250 59,784 38,671 70,944 883,013

Loss allowance (RMB’000) 7,389 30,648 28,337 28,338 27,144 70,944 192,800

As at March 31, 2021 Up to 1 1to2 2to3 3to4 4to5 Over 5 year years years years years years Total

Expected loss rate 1.93% 12.95% 30.39% 47.40% 70.19% 100.00% Gross carrying amount – trade receivables (RMB’000) 577,587 213,541 120,130 51,015 48,337 72,750 1,083,360

Loss allowance (RMB’000) 11,124 27,647 36,505 24,182 33,929 72,750 206,137

Movements on the Group’s allowance for impairment of trade receivables were as follows:

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

At the beginning of the year/period 67,046 122,251 180,537 192,800 Net increase in loss allowance 55,205 58,300 13,775 13,377 Receivables written off as uncollectible – (14) (1,512) (40)

At the end of the year/period 122,251 180,537 192,800 206,137

Notes receivable

The notes receivable were classified as stage 1 during the Track Record Period. The directors of the Company assessed that the expected credit losses was immaterial.

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Other receivables and payments on behalf of residents

Other receivables mainly included payments on behalf of customers, amounts due from related parties and deposits. As at December 31, 2018, 2019 and 2020 and March 31, 2021, management considered the credit risk of other receivables and payments on behalf of residents to be low and thus classified other receivables and payments on behalf of residents in stage 1.

Movements on the Group’s allowance for impairment of other receivables and payments on behalf of residents were as follows:

− Other receivables

As at As at 31 December March 31 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

At the beginning of the year/period 30,322 17,999 19,481 29,128 Net (decrease)/increase in loss allowance (12,293) 1,482 15,232 2,299 Receivables written off as uncollectible (30) – (5,585) –

At the end of the year/period 17,999 19,481 29,128 31,427

− Payments on behalf of residents

As at As at 31 December March 31 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

At the beginning of the year/period 25,266 17,765 21,106 15,793 Net (decrease)/increase in loss allowance (7,501) 3,341 (5,313) (592)

At the end of the year/period 17,765 21,106 15,793 15,201

3.1.3 Liquidity risk

To manage liquidity risk, the Group monitors and maintains a level of cash and cash equivalents deemed adequate by the directors of the Company to finance the Group’s operations and mitigate the effects of fluctuations in cash flows.

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The table below set out the Group’s financial liabilities grouped into relevant maturity groupings based on their contractual maturity dates. The amounts disclosed in the table are the contractual undiscounted cash flows. Balances due within 12 months equal their carrying balances, as the impact of discounting is not significant.

Between Between Less than 1 and 2and Over Carrying 1 year 2 years 5 years 5 years Total Amount RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000

As at December 31, 2018 Borrowings 130,649 40,771 – – 171,420 166,416 Trade and other payables (excluding other taxes payables and accrued payroll) 817,370 – – – 817,370 817,370 Receipts on behalf of residents 145,949 – – – 145,949 145,949 Lease liabilities 30,841 25,687 29,783 24,483 110,794 95,492 Redeemable shares 420,498 – – – 420,498 569,358

Total 1,545,307 66,458 29,783 24,483 1,666,031 1,794,585

As at December 31, 2019 Borrowings 127,389 18,166 17,437 – 162,992 158,566 Trade and other payables (excluding other taxes payables and accrued payroll) 839,221 – – – 839,221 839,221 Receipts on behalf of residents 127,178 – – – 127,178 127,178 Lease liabilities 34,206 14,699 25,365 16,149 90,419 79,336 Redeemable shares 460,546 – – – 460,546 562,255

Total 1,588,540 32,865 42,802 16,149 1,680,356 1,766,556

As at December 31, 2020 Borrowings 140,426 17,437 – – 157,863 153,766 Trade and other payables (excluding other taxes payables and accrued payroll) 838,827 – – – 838,827 838,827 Receipts on behalf of residents 142,120 – – – 142,120 142,120 Lease liabilities 35,545 11,884 33,187 7,896 88,512 79,251

Total 1,156,918 29,321 33,187 7,896 1,227,322 1,213,964

As at March 31, 2021 Borrowings 139,045 12,796 – – 151,841 149,516 Trade and other payables (excluding other taxes payables and accrued payroll) 1,002,802 – – – 1,002,802 1,002,802 Receipts on behalf of residents 151,921 – – – 151,921 151,921 Lease liabilities 36,592 11,460 32,482 5,801 86,335 74,950

Total 1,330,360 24,256 32,482 5,801 1,392,899 1,379,189

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3.2 Capital management

The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholder, issue new shares or sell assets to reduce debt.

The Group monitors capital on basis of the gearing ratio. This ratio is calculated as net debt divided by total capital. Net debt is calculated as total borrowings (including lease liabilities) less cash and cash equivalents. Total capital include the capital (including “equity” as shown in the consolidated balance sheets and redeemable shares on an as-if-not-redeemable basis) plus net debt.

During the Track Record Period, the Group has maintained at net cash position, thus the directors of the Company considered that the Group’s capital risk is low.

3.3 Fair value estimation

The Group made judgments and estimates in determining the fair values of the financial instruments that are recognized and measured at fair value in the financial statements. To provide an indication about the reliability of the inputs used in determining fair value, the Group has classified its financial instruments into the three levels prescribed under the accounting standards.

The Group’s policy is to recognize transfers into and transfers out of fair value hierarchy levels as at the end of the reporting period.

Level 1: The fair value of financial instruments traded in active markets is based on quoted market prices at the end of the reporting period. The quoted market price used for financial assets held by the Group is the current bid price. These instruments are included in level 1.

Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which maximize the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.

Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.

As at December 31, 2018, 2019 and 2020 and March 31, 2021, the Group had no level 1 and level 2 financial instruments. Level 3 instruments represented the financial assets at fair value through profit or loss as at December 31, 2018, 2019 and 2020 and March 31, 2021.

There were no changes in valuation techniques during the years ended December 31, 2018, 2019 and 2020 and three months ended March 31, 2021.

There were no transfers between levels 1, 2 and 3 for recurring fair value measurements during the Track Record Period.

The Group has a team that manages the valuation of level 3 instruments for financial reporting purposes. The team manages the valuation exercise of the investments on a case by case basis. At least once every year, the team would use valuation techniques to determine the fair value of the Group’s level 3 instruments. External valuation experts will be involved when necessary.

The valuation of the level 3 instruments mainly included financial assets at fair value through profit or loss. As these instruments are not traded in an active market, their fair values have been determined by using various applicable valuation techniques, including discounted cash flows approach.

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The following table presents the Group’s financial assets that were measured at fair value for the Track Record Period:

Level 1 Level 2 Level 3 Total RMB’000 RMB’000 RMB’000 RMB’000

Assets At December 31, 2018 – Wealth management products – – 48,509 48,509

At December 31, 2019 – Wealth management products – – 17,575 17,575

At December 31, 2020 – Wealth management products – – 46,789 46,789

At March 31, 2021 – Wealth management products – – 61,817 61,817

The following table presents the changes of the Group’s in level 3 instruments for the Track Record Period:

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Opening balance 32,616 48,509 17,575 46,789 Additions 422,226 1,114,597 1,009,219 344,004 Disposals (408,180) (1,148,575) (981,852) (329,481) Gains for the year/period recognized in profit or loss 1,847 3,044 1,847 505

Closing balance 48,509 17,575 46,789 61,817

Includes unrealized gains recognized in profit or loss attributable to balances held at the end of the reporting year/period 59 18 42 66

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Quantitative information about fair value measurements using significant unobservable inputs (Level 3) is presented in following table:

Range of Fair value expected Relationship of at year/ Valuation Unobservable interest rate unobservable inputs period end technique(s) input per annum to fair value (RMB’000)

December 31, 2018 48,509 Discounted Expected 3.0%-4.2% The higher the cash flow interest rate expected interest per annum rate, the higher the fair value December 31, 2019 17,575 Discounted Expected 2.9%-4.2% The higher the cash flow interest rate expected interest per annum rate, the higher the fair value December 31, 2020 46,789 Discounted Expected 1.6%-2.9% The higher the cash flow interest rate expected interest per annum rate, the higher the fair value March 31, 2021 61,817 Discounted Expected 2.1%-3.7% The higher the cash flow interest rate expected interest per annum rate, the higher the fair value

The following table presents the Group’s liabilities that were measured at fair value for the Track Record Period:

Level 1 Level 2 Level 3 Total RMB’000 RMB’000 RMB’000 RMB’000

Liabilities At December 31, 2018 – Redeemable shares – – 569,358 569,358

At December 31, 2019 – Redeemable shares – – 562,255 562,255

At December 31, 2020 –Redeemableshares––––

At March 31, 2021 –Redeemableshares––––

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The valuation of the level 3 instruments mainly included redeemable shares. Major assumptions used in the valuation for redeemable shares were disclosed in Note 34.

There were no transfers between levels 1, 2 and 3 during the years ended December 31, 2018, 2019 and 2020 and period ended March 31, 2021.

The carrying amounts of the Group’s financial assets and liabilities, including cash and cash equivalents, restricted bank deposits, trade and other receivables, payments/receipts on behalf of residents, borrowings, and trade and other payables (excluding non-financial liabilities) approximated their fair values.

As at December 31, 2018, 2019, 2020 and March 31, 2021, there were certain investment properties measured at fair value in using income approach which were approximate to their fair values. See Note 16 for disclosures related to investment properties.

As at December 31, 2018, 2019, 2020 and March 31, 2021, there were certain assets held for sale measured at lower of carrying amount and fair value less cost to sell using direct market comparable approach. See Note 28 for disclosures related to assets held for sale.

4 CRITICAL ESTIMATES AND JUDGMENTS

The preparation of the Historical Financial Information requires the use of accounting estimates which, by definition, will seldom equal the actual results. Management also needs to exercise judgment in applying the Group’s accounting policies.

Estimates and judgments are continually evaluated. They are based on historical experience and other factors, including expectations of future events that may have a financial impact on the entity and that are believed to be reasonable under the circumstances.

(a) Fair value of investment properties

The fair value of investment properties is determined by using valuation technique.

Details of the valuation and key assumptions are disclosed in Note 16.

(b) Valuation of assets held for sale

The fair value less costs to sell of assets held for sale is determined by using valuation technique. Details of the valuation are disclosed in Note 28.

The redeemable shares issued by the Company are not traded in an active market and the respective fair value is determined by using valuation techniques. The Group has used the discounted cash flow method to determine the underlying equity value of the Company and adopted a hybrid method, being a hybrid of scenario-based methods and the option pricing method to determine the fair value of the redeemable shares. Key assumptions include discount rate, discount for the lack of marketability, discount for the lack of control, risk-free interest rate and volatility. Details of the key assumptions are disclosed in Note 34.

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(d) Impairment for receivables

The Group makes allowances on receivables based on assumptions about risk of default and expected loss rates. The Group used judgment in making these assumptions and selecting the inputs to the impairment calculation, based on the Group’s past history, existing market conditions as well as forward looking estimates at the end of each reporting period.

Where the expectation is different from the original estimate, such difference will impact the carrying amount of trade and other receivables and the related loss allowances in the period in which such estimate is changed. For details of the key assumptions and inputs used, see Note 3.1.2 above.

(e) Current and deferred income taxes

The Group is subject to income taxes in the PRC. Judgement is required in determining provision for taxation and timing of payment of the related taxations. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the current and deferred income tax assets and liabilities in the period in which such determination is made.

For temporary differences which give rise to deferred tax assets, the Group assesses the likelihood that the deferred income tax assets may be recovered. Deferred tax assets are recognized based on the Group’s estimates and assumptions that they will be recovered from taxable income arising from continuing operations in the foreseeable future. The outcome of their actual utilization may be different.

5 SEGMENT INFORMATION

Management has determined the operating segments based on the reports reviewed by CODM. The CODM, who is responsible for allocating resources and assessing performance of the operating segment, has been identified as the executive directors of the Company.

During the Track Record Period, the Group is principally engaged in the provision of property management services, value-added services to property developers, community value-added services and professional services in the PRC. CODM reviews the operating results of the business as one operating segment to make decisions about resources to be allocated. Therefore, the CODM of the Company regards that there is only one segment which is used to make strategic decisions.

All operating entities of the Group is domiciled in the PRC. Accordingly, all of the Group’s revenue were derived in the PRC during the Track Record Period.

As at December 31, 2018, 2019 and 2020 and March 31, 2021, all of the Group’s non-current assets were located in the PRC.

The Group has a large number of customers, none of whom contributed 10% or more of the Group’s revenue during the Track Record Period.

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6 REVENUE

Revenue mainly comprises of proceeds from property management services, value-added services to property developers, community value-added services and professional services. An analysis of the Group’s revenue by category for the years ended December 31, 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021 is as follows:

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Types of services Property management services 1,905,789 2,196,176 2,315,359 538,546 608,096 Value-added services to property developers 152,536 123,173 108,473 27,260 28,014 Community value-added services 236,151 321,237 368,304 89,392 107,536 Professional services 109,811 169,763 243,464 37,964 40,152

2,404,287 2,810,349 3,035,600 693,162 783,798

Revenue is recognized - Over time 2,404,030 2,808,569 3,032,899 692,843 782,873 - At a point in time 257 1,780 2,701 319 925

Total revenue 2,404,287 2,810,349 3,035,600 693,162 783,798

(a) Contract liabilities

The Group has recognized the following liabilities related to contracts with customers:

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Contract liabilities 162,479 209,651 205,055 157,914

Contract liabilities of the Group mainly arise from the advance payments made by customers while the underlying services are yet to be provided. The increase in contract liabilities from December 31, 2018 to December 31, 2019 and 2020 was mainly due to the growth of the Group’s business, while the decrease from December 31, 2020 to March 31, 2021 was mainly due to the seasonal factors.

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The following table shows how much of the revenue recognized in the current reporting period relates to carried-forward contract liabilities:

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Revenue recognized that was included in the balance of contract liabilities at the beginning of the year/period: Property management services 127,708 99,057 141,467 35,367 36,660 Value-added services to property developers 180 323 7 7 – Community value-added services 50,825 62,539 66,406 36,510 59,202 Professional services 306 560 1,771 1,771 1,580

179,019 162,479 209,651 73,655 97,442

(b) Unsatisfied performance obligations

For property management services, the Group recognizes revenue in the amount that equals to the right to invoice which corresponds directly with the value to the customers of the Group’s performance to date, on a regular basis. The Group has elected the practical expedient for not to disclose the remaining performance obligations for these type of contracts. The majority of the property management service contracts do not have a fixed term. The term of the contracts for value-added services to property developers is generally set to expire when the conterparties notify the Group that the services are no longer required.

For other value-added services and professional services, they are rendered in a short period of time and there is no material unsatisfied performance obligation at the end of respective periods.

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7 OTHER INCOME – NET

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Super deduction of value-added tax (a) – 12,446 15,300 1,205 2,001 Government grants (b) 7,134 3,633 30,207 1,138 358 Rental income from operating leases 8,487 10,097 10,871 1,290 1,924 Others (2,801) 843 (6,657) (3,312) (464)

12,820 27,019 49,721 321 3,819

(a) On March 20, 2019, the Ministry of Finance, State Administration of Taxation and General Administration of Customs jointly issued a circular regarding to the “Relevant Taxation Policies of Deepen Reforms of Value-added Tax” (No.39 in the year of 2019, as the “Circular”) (財政部稅務總局海關總署公告2019年第39號《關於深化增值稅改革有關政策的公告》). Based on the regulations of the Circular, from April 1, 2019 to December 31, 2021, the tax payer of consumer-oriented service industry is entitled to a 10% super deduction of the deductible value-added tax in current taxation period. The Group was entitled to such super deduction subsidy under the Circular as the Group mainly provided property management services to the residents and was qualified as a tax payer in the consumer-oriented service industry.

(b) During the Track Record Period, the Group’s government grants mainly consisted of subsidies in relation to the local business or investment attraction, allowance from local government for general business support and refund of withheld individual income tax.

8 OTHER GAINS – NET

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Net gains/(losses) on disposal of property, plant and equipment, intangible assets and investment properties 1,540 422 457 (25) 4,396 Fair value gains on investment properties (Note 16) 8,720 10,846 5,134 1,574 824 Unrealized fair value gains on financial assets at fair value through profit or loss 59 18 42 308 66 Others 174 (2,411) (2,379) 144 (152)

10,493 8,875 3,254 2,001 5,134

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9 EXPENSES BY NATURE

Expenses included in cost of services, selling and marketing expenses and administrative expenses are analyzed as follows:

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Employee benefits expenses (Note 10(a)) 830,495 985,788 1,106,029 254,149 302,485 Security expenses 427,262 423,674 425,458 118,721 135,191 Cleaning expenses 300,898 375,121 405,098 89,221 78,786 Utilities 211,955 274,124 245,161 72,079 78,191 Maintenance expenses 204,449 205,610 214,687 32,202 42,679 Office expenses 106,455 118,079 136,799 14,072 18,047 Greening and gardening expenses 52,420 54,748 61,754 11,845 9,777 Depreciation and amortization expenses 46,877 51,284 56,605 13,749 13,340 Traveling and entertainment expenses 37,623 41,547 38,727 3,269 4,775 Short-term and low value lease expenses 8,246 15,071 17,120 3,777 3,644 Taxes and surcharges 12,683 12,166 16,375 2,201 2,578 Professional service fees 9,515 5,901 14,714 804 1,330 Auditors’ remuneration 1,851 1,544 1,268 – – Impairment of assets held for sale (Note 28) 1,892 8,419 1,812 – 161 [REDACTED] expenses ––––[REDACTED] Others 16,752 33,977 38,403 3,239 5,988

2,269,373 2,607,053 2,780,010 619,328 [REDACTED]

10 EMPLOYEE BENEFIT EXPENSES

(a) Employee benefit expenses are analyzed as follows:

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Salaries, wages, and bonuses 621,739 746,873 922,286 195,603 239,671 Social insurance and housing provident fund contributions 136,148 155,007 94,789 35,983 38,260 Other benefits 72,608 83,908 88,954 22,563 24,554

830,495 985,788 1,106,029 254,149 302,485

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All local employees of the subsidiaries in the PRC participate in employee social insurance plans established in the PRC, which cover pension, medical and other welfare benefits. The plans are organized and administered by the governmental authorities. Apart from the contributions made to these social insurance plans, the Group has no other material commitments owing to the employees.

According to policies issued by the Ministry of Human Resources and Social Security and local municipal departments in February 2020, as affected by Coronavirus Disease 2019 (COVID-19), social security relief policies have been implemented by the local authorities. As such, the social insurance expenses for the period from February 2020 to December 2020 have been reduced or exempted accordingly.

(b) Five highest paid individuals

The five individuals with the highest emoluments in the Group include 3 directors during the Track Record Period, whose emoluments are reflected in the analysis shown in Note 40. The emoluments payable to the remaining 2 individuals for the Track Record Period are as follows:

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Salaries, wages and bonuses 1,959 2,125 2,255 569 555 Social insurance and housing provident fund contributions 156 138 122 25 39 Allowances and benefits in kind – 1,509 1,509 – –

2,115 3,772 3,886 594 594

The emoluments of these individuals are within the following bands:

Number of individuals

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 (Unaudited)

Emolument bands Nil – HK$500,000 –––22 HK$1,000,001 – HK$1,500,000 2–––– HK$2,000,001 – HK$2,500,000 –22––

22222

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11 FINANCE INCOME AND COSTS

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

4,646 5,856 4,384 1,358 983

Finance costs: Interest expenses on lease liabilities (5,454) (4,587) (3,984) (1,068) (844) Interest expenses on bank borrowings (9,106) (8,087) (8,037) (1,909) (1,913)

(14,560) (12,674) (12,021) (2,977) (2,757)

Finance costs – net (9,914) (6,818) (7,637) (1,619) (1,774)

12 INCOME TAX EXPENSE

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Current income tax 46,178 65,927 86,696 25,460 34,564 Deferred income tax (Note 20) (7,141) (14,368) (5,912) (6,257) (7,709)

39,037 51,559 80,784 19,203 26,855

Income tax provision of the Group in respect of operations in Mainland China has been calculated at the applicable tax rate at 25% on the estimated assessable profits for the years, based on the existing legislation, interpretations and practices in respect thereof.

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The income tax expense for the Track Record Period can be reconciled to the profit before tax as follows:

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Profit before income tax 110,409 185,721 287,350 66,295 76,826

Tax calculated at applicable corporate income tax rate of 25% 27,602 46,430 71,838 16,574 19,207 Tax losses not recognized 7,942 7,273 9,622 3,816 5,977 Effects of share of post-tax results of joint ventures (1,004) (2,342) (2,445) (107) 274 Income not subject to tax (83) (2,692) (886) (1,270) – Expenses not deductible for taxation purposes 4,580 2,890 2,655 190 1,397

39,037 51,559 80,784 19,203 26,855

13 EARNINGS PER SHARE

(a) Basic earnings per share

Basic earnings per share is calculated by dividing the profit attributable to owners of the Company by the weighted average number of ordinary shares in issue during the year.

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 (Unaudited)

Profit attributable to owners of the Company (RMB’000) 69,245 135,344 210,012 49,920 53,268 Weighted average number of shares in issue (thousands shares) 69,243 68,223 74,865 68,223 81,544

Basic earnings per share (in RMB) 1.00 1.98 2.81 0.73 0.65

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(b) Diluted earnings per share

Dilutive potential ordinary shares represented redeemable shares, details of which are set out in Note 34.

Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account:

• the after income tax effect of fair value changes associated with the redeemable shares, and

• the weighted average number of additional ordinary shares that would have been outstanding assuming the conversion of all the redeemable shares.

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 (Unaudited) Note (i)

Profit attributable to owners of the company: Used in calculating basic earnings per share (RMB’000) 69,245 135,344 210,012 49,920 N/A Add/(less): fair value changes on redeemable shares (RMB’000) 6,507 (7,103) (338) (4,262) N/A

Used in calculating diluted earnings per share (RMB’000) 75,752 128,241 209,674 45,658 N/A

Weighted average number of ordinary shares in issue (thousands shares) 69,243 68,223 74,865 68,223 N/A Adjustments: redeemable shares (thousands shares) 12,301 13,321 6,679 13,321 N/A

Weighted average number of ordinary shares for diluted earnings per share (thousands shares) 81,544 81,544 81,544 81,544 N/A

Diluted earnings per share (in RMB) 0.93 1.57 2.57 0.56 N/A

(i) Diluted earnings per share were the same as the basic earnings per share as there were no potentially dilutive ordinary shares outstanding during the three months ended March 31, 2021.

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14 PROPERTY, PLANT AND EQUIPMENT

Motor Leasehold Electronic Construction Buildings Machinery Vehicles improvements equipment in progress Total RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000

At January 1, 2018 Cost 84,556 428 11,456 32,172 70,320 1,622 200,554 Accumulated depreciation (27,415) (176) (7,855) (15,556) (48,203) – (99,205)

Net book amount 57,141 252 3,601 16,616 22,117 1,622 101,349

Year ended December 31, 2018 Opening net book amount 57,141 252 3,601 16,616 22,117 1,622 101,349 Additions 31,901 577 840 6,005 23,696 3,579 66,598 Transfer upon completion ––––1,005 (1,005) – Transfer from investment properties 5,230 –––––5,230 Transfer to investment properties (20,495) –––––(20,495) Disposals (5,995) (18) (3) – (411) – (6,427) Depreciation (4,463) (228) (1,202) (6,407) (17,000) – (29,300)

Closing net book amount 63,319 583 3,236 16,214 29,407 4,196 116,955

At December 31, 2018 Cost 79,065 929 10,237 38,177 79,064 4,196 211,668 Accumulated depreciation (15,746) (346) (7,001) (21,963) (49,657) – (94,713)

Net book amount 63,319 583 3,236 16,214 29,407 4,196 116,955

Year ended December 31, 2019 Opening net book amount 63,319 583 3,236 16,214 29,407 4,196 116,955 Additions 22,128 2,314 1,242 15,445 10,299 6,852 58,280 Transfer upon completion ––––7,409 (7,409) – Disposals (1,721) – (4) – – – (1,725) Depreciation (7,568) (272) (1,268) (6,306) (16,121) – (31,535)

Closing net book amount 76,158 2,625 3,206 25,353 30,994 3,639 141,975

At December 31, 2019 Cost 96,527 3,158 10,951 53,622 96,772 3,639 264,669 Accumulated depreciation (20,369) (533) (7,745) (28,269) (65,778) – (122,694)

Net book amount 76,158 2,625 3,206 25,353 30,994 3,639 141,975

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Motor Leasehold Electronic Construction Buildings Machinery Vehicles improvements equipment in progress Total RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000

Year ended December 31, 2020 Opening net book amount 76,158 2,625 3,206 25,353 30,994 3,639 141,975 Additions 21,466 7,056 1,347 10,809 11,440 8,912 61,030 Transfers upon completion – – – 3,206 3,395 (6,601) – Disposals (10,048) (1,386) (19) – (1,610) – (13,063) Depreciation (5,768) (1,960) (1,424) (8,332) (13,832) – (31,316)

Closing net book amount 81,808 6,335 3,110 31,036 30,387 5,950 158,626

At December 31, 2020 Cost 105,980 8,481 11,724 67,637 109,997 5,950 309,769 Accumulated depreciation (24,172) (2,146) (8,614) (36,601) (79,610) – (151,143)

Net book amount 81,808 6,335 3,110 31,036 30,387 5,950 158,626

Three months ended March 31, 2021 Opening net book amount 81,808 6,335 3,110 31,036 30,387 5,950 158,626 Additions – 1,243 57 751 – 1,105 3,156 Disposal (9,709) – – – (378) – (10,087) Depreciation (1,304) (1,324) (304) (2,579) (1,968) – (7,479)

Closing net book amount 70,795 6,254 2,863 29,208 28,041 7,055 144,216

At March 31, 2021 Cost 96,271 9,724 11,781 68,388 109,619 7,055 302,838 Accumulated depreciation (25,476) (3,470) (8,918) (39,180) (81,578) – (158,622)

Net book amount 70,795 6,254 2,863 29,208 28,041 7,055 144,216

(Unaudited) Three months ended March 31, 2020 Opening net book amount 76,158 2,625 3,206 25,353 30,994 3,639 141,975 Additions 572 264 359 1,486 856 – 3,537 Disposal – – (2) – (158) – (160) Depreciation (1,109) (174) (367) (2,957) (4,127) – (8,734)

Closing net book amount 75,621 2,715 3,196 23,882 27,565 3,639 136,618

At March 31, 2020 Cost 97,099 3,422 11,239 55,108 91,853 3,639 262,360 Accumulated depreciation (21,478) (707) (8,043) (31,226) (64,288) – (125,742)

Net book amount 75,621 2,715 3,196 23,882 27,565 3,639 136,618

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Depreciation expenses were charged to the following categories in the consolidated statements of comprehensive income:

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Cost of services 18,754 22,676 22,001 6,082 5,359 Selling and marketing expenses 152 227 928 174 117 Administrative expenses 10,394 8,632 8,387 2,478 2,003

29,300 31,535 31,316 8,734 7,479

The Group’s buildings were located in the PRC. Buildings with net book amount of approximately RMB9,239,000, RMB8,651,000, RMB8,063,000 and RMB7,916,000 as at December 31, 2018, 2019, 2020 and March 31, 2021 were pledged as collateral for the Group’s bank borrowings (Note 33).

15 LEASES

(a) Right-of-use assets

The following tables show the movements of right-of-use assets during the Track Record Period:

Properties RMB’000

As at January 1, 2018 Cost 95,978 Accumulated depreciation (9,806)

Net book amount 86,172

Year ended December 31, 2018 Opening net book amount 86,172 Depreciation (8,798) Disposals (5,391)

Closing net book amount 71,983

As at December 31, 2018 Cost 89,787 Accumulated depreciation (17,804)

Net book amount 71,983

Year ended December 31, 2019 Opening net book amount 71,983 Additions 6,237 Depreciation (10,712) Disposals (644)

Closing net book amount 66,864

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Properties RMB’000

As at December 31, 2019 Cost 95,256 Accumulated depreciation (28,392)

Net book amount 66,864

Year ended December 31, 2020 Opening net book amount 66,864 Additions 24,668 Depreciation (16,982) Disposals (452)

Closing net book amount 74,098

As at December 31, 2020 Cost 119,355 Accumulated depreciation (45,257)

Net book amount 74,098

Three month ended March 31, 2021 Opening net book amount 74,098 Additions 103 Depreciation (4,639)

Closing net book amount 69,562

As at March 31, 2021 Cost 119,458 Accumulated depreciation (49,896)

Net book amount 69,562

(Unaudited) Three month ended March 31, 2020 Opening net book amount 66,864 Additions 9,825 Depreciation (4,105)

Closing net book amount 72,584

As at March 31, 2020 Cost 105,081 Accumulated depreciation (32,497)

Net book amount 72,584

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The Group leases various offices and parking lots. Rental contracts are typically made for fixed periods of 1 month to 240 months. Payments associated with short-term leases with a lease term of 12 months or less are recognized on a straight-line basis as an expense in the consolidated statements of comprehensive income.

Depreciation of right-of-use assets was charged to the “administrative expenses”, “selling and marketing expenses” and “cost of services” in the consolidated statements of comprehensive income.

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Cost of services 2,627 3,806 8,813 2,146 2,144 Selling and marketing expenses 216 205 98 25 11 Administrative expenses 5,955 6,701 8,071 1,934 2,484

8,798 10,712 16,982 4,105 4,639

(b) Lease liabilities

As at Year ended December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Lease liabilities –Current 30,050 33,240 34,803 35,736 –Non-current 65,442 46,096 44,448 39,214

95,492 79,336 79,251 74,950

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The following table presents the amounts recognized in the consolidated statements of comprehensive income:

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Depreciation charge – Properties 8,798 10,712 16,982 4,105 4,639

Interest expenses (included in finance cost) (Note 11) 5,454 4,587 3,984 1,068 844 Expenses relating to short-term leases (included in cost of services, selling and marketing expenses and administrative expenses) (Note 9) 8,246 15,071 17,120 3,092 2,712 Total cash outflows for leases 38,355 42,051 50,619 10,014 9,947

16 INVESTMENT PROPERTIES

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

At fair value Opening balance 219,076 284,366 294,872 294,872 295,208 Additions – 3,860 372 – – Disposals – – (2,470) – – Fair value change recognized in profit or loss 8,720 10,846 5,134 1,574 824 Fair value change recognized in other comprehensive income – (4,200) (2,700) (900) – Transfer to property, plant and equipment (5,230) –––– Transfer from property, plant and equipment – Carrying amount on the date of transfer 20,495 –––– – Revaluation gains recognized in other comprehensive income 41,305 ––––

Closing balance 284,366 294,872 295,208 295,546 296,032

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(a) The following tables show the amounts recognized in profit or loss for investment properties during the Track Record Period:

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Rental income from operating leases 8,487 10,097 10,871 1,290 1,924 Fair value gains recognized in other gains 8,720 10,846 5,134 1,574 824

17,207 20,943 16,005 2,864 2,748

An independent valuation of the Group’s investment properties was performed by a valuer to determine the fair value of the investment properties based on highest and best use for the Track Record Period. The Group’s investment properties, which comprised office buildings in the PRC, were carried at fair value and measured using significant unobservable inputs (Level 3) for the Track Record Period.

(b) Leasing arrangements

The investment properties are leased to tenants under operating leases with rentals payable monthly. Where considered necessary to reduce credit risk, the Group required the tenants to provide deposits for the term of lease contract.

Although the Group is exposed to changes in the residual value at the end of the current leases, the Group typically enters into new operating leases and therefore will not immediately realize any reduction in residual value at the end of these leases. Expectations about the future residual values are reflected in the fair value of the properties.

Valuation process of the Group

The Group’s finance department includes a team that reviews the valuations performed by the independent valuers for financial reporting purposes. This team reports directly to the chief financial officer (CFO). Discussions of valuation processes and results are held among the CFO, the valuation team and the valuer on a periodically basis.

At the end of each year/peiod end during the Track Record Period, the finance department:

• Verifies all major inputs to the independent valuation report;

• Assesses property valuations movements when compared to the prior year valuation result;

• Holds discussions with the independent valuer.

As part of this discussion, the independent valuer presents a report that explains the reasons for the fair value movements.

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Valuation techniques

For completed office buildings, the valuation was determined using income approach based on significant unobservable inputs. These inputs include:

Relationship of unobservable Unobservable inputs Description inputs to fair value

Term yields Based on yields extracting from terms of The higher the term yields rate, the current leases lower the fair value Reversionary yields Based on expected yields after expiry of The higher the reversionary yields rate, any current leases the lower the fair value Fair market rents Based on the actual location, type and The higher the rental value, the higher quality of the properties and the fair value supported by the terms of any existing lease, other contracts and external evidence such as current market rents for similar properties

The following table presents the range of unobservable inputs during Track Record Period:

As at Year ended December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Term yields 3.0%-5.0% 3.0%-5.0% 3.0%-5.0% 3.0%-5.0% Reversionary yields 3.5%-5.5% 3.5%-5.5% 3.5%-5.5% 3.5%-5.5% Fair market rents (RMB per square meter per month) 128-230 131-230 130-230 131-230

There were no changes to the valuation techniques during the Track Record Period.

Investment properties with fair value of approximately RMB243,137,000, RMB247,631,000, RMB249,355,000 and RMB250,735,000 as at December 31, 2018, 2019, 2020 and March 31, 2021 were pledged as collateral for the Group’s bank borrowings (Note 33).

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17 INTANGIBLE ASSETS

Computer software RMB’000

At January 1, 2018 Cost 48,846 Accumulated amortization (22,359)

Net book amount 26,487

Year ended December 31, 2018 Opening net book amount 26,487 Additions 2,946 Amortization (8,779)

Net book amount 20,654

At December 31, 2018 Cost 51,792 Accumulated amortization (31,138)

Net book amount 20,654

Year ended December 31, 2019 Opening net book amount 20,654 Additions 8,710 Amortization (9,037)

Net book amount 20,327

At December 31, 2019 Cost 60,502 Accumulated amortization (40,175)

Net book amount 20,327

Year ended December 31, 2020 Opening net book amount 20,327 Additions 8,883 Amortization (8,307)

Net book amount 20,903

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Computer software RMB’000

At December 31, 2020 Cost 69,385 Accumulated amortization (48,482)

Net book amount 20,903

Three months ended March 31, 2021 Opening net book amount 20,903 Disposals (848) Amortization (1,222)

Net book amount 18,833

At March 31, 2021 Cost 68,537 Accumulated amortization (49,704)

Net book amount 18,833

(Unaudited) Three months ended March 31, 2020 Opening net book amount 20,327 Amortization (910)

Net book amount 19,417

At March 31, 2020 Cost 60,502 Accumulated amortization (41,085)

Net book amount 19,417

Amortization charge of the Group’s intangible assets has been charged to administrative expenses during the Track Record Period.

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18 SUBSIDIARIES

The following is a list of the principal subsidiaries of the Group:

Attributable equity interest of the Group As at March 31, 2021 and Registered/ the date Principal activities Name of statutory As at December 31, Place and date paid-in of this and place of auditors and Company name of incorporation capital 2018 2019 2020 report operation periods covered (RMB’000)

深圳市深長城物業集團有限公司 The PRC, 15,000 100% 100% 100% 100% Property N/A (Note (a)) Shenzhen Shenchangcheng August 7, 2009 management Property Group Co., Ltd. services in Shenzhen

深圳市長城樓宇科技有限公司 The PRC, 10,000 100% 100% 100% 100% Building equipment 瑞華會計師事務所（特殊普通 Shenzhen Changcheng Louyu March 24, 2010 and facilities 合夥）深圳分所 Technology Co., Ltd. maintenance service Years ended December in Shenzhen 31, 2018 and 2019 容誠會計師事務所（特殊普通合夥）深圳分所 Year ended December 31, 2020

深圳一應社區科技集團有限公司 The PRC, 19,283 100% 100% 100% 100% E-commerce in 瑞華會計師事務所（特殊普通 Shenzhen Yiying Community February 20, Shenzhen 合夥）深圳分所 Technology Group Co., Ltd. 2012 Years ended December 31, 2018 and 2019 容誠會計師事務所（特殊普通合夥）深圳分所 Year ended December 31, 2020

深圳市睿商商業經營管理有限公司 The PRC, 1,000 100% 100% 100% 100% Property N/A (Note (a)) Shenzhen Ruishang Commercial September 10, management Operation Management Co., Ltd. 2012 services in Shenzhen

深圳市長城電梯工程有限公司 The PRC, 15,000 100% 100% 100% 100% Elevator 瑞華會計師事務所（特殊普通 Shenzhen Changcheng Elevator February 17, maintenance service 合夥）深圳分所 Engineering Co., Ltd. 1995 in Shenzhen Years ended December 31, 2018 and 2019 容誠會計師事務所（特殊普通合夥）深圳分所 Year ended December 31, 2020

深圳市長城停車場管理建設有限公司 The PRC, 500 100% 100% 100% 100% Parking operating N/A (Note (a)) Shenzhen Changcheng Car May 18, 2004 service in Shenzhen Parking Management Construction Co., Ltd.

福州福匯物業管理有限公司 The PRC, 500 70% 70% 70% 70% Property N/A (Note (a)) Fuzhou Fuhui Property January 05, management Management Co., Ltd. 2003 services in Shenzhen

During the Track Record Period, there were no material non-controlling interests in the Group’s subsidiaries.

* The English names of the above entities represent the best efforts made by the management of the Company in translating its Chinese names as they do not have official English names.

(a) No statutory audited financial statements were issued for these companies as they are not required to issue audited financial statements under the statutory requirement of the respective place of incorporation.

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19 INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Interests in investments accounted for using equity method (a) 8,794 21,867 32,112 33,573

(a) Interests in joint ventures

Three months ended Year ended December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

At the beginning of the year/period 1,483 8,794 21,867 32,112 Additions 3,630 7,370 3,674 2,556 Share of results 4,014 9,369 9,778 (1,095) Dividends received (333) (3,666) (3,207) –

At the end of the year/period 8,794 21,867 32,112 33,573

Set out below is the details of the principal joint ventures of the Group:

Attributable equity interest of the Group As at As at December 31, March 31, Place and date of Principal Company name incorporation activities 2018 2019 2020 2021

濟寧市城投物業服務有限公司 Shenzhen, Property 49% 49% 49% 49% Jining City Investment the PRC, management Property Service Co., Ltd. March 16, 2015 services

深圳市深長城商用物業服務 Shenzhen, Property 40% 40% 40% 40% 有限公司 the PRC, management Shenzhen Shenchangcheng December 19, services Commercial Property Service 2016 Co., Ltd.

寧夏建投長城物業管理 Ningxia, Property 51% 51% 51% 51% 有限公司 the PRC, management Ningxia Construction September 11, services Investment Changcheng 2017 Property Management Co., Ltd.

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Attributable equity interest of the Group As at As at December 31, March 31, Place and date of Principal Company name incorporation activities 2018 2019 2020 2021

蘇州工業園區勝城物業管理 Suzhou, the PRC, Property 45% 47% 47% 47% 有限公司 Mar 16, 2015 management Suzhou Industrial Park services Shengcheng Property Management Co., Ltd.

中核長城（上海）物業服務 Shanghai, Property – 65% 55% 55% 有限公司 the PRC, management China Nuclear Changcheng September 14, services (Shanghai) Property Service 2018 Co., Ltd.

山西深長城物業管理有限公司 Shanxi, the PRC, Property 51% 51% 51% 51% Shanxi Shenchangcheng September 7, 2018 management Property Management services Co., Ltd.

北京天誠古運物業管理有限公司 Beijing, the PRC, Property 50% 50% 50% 50% Beijing Tiancheng Guyun March 3, 2008 management Property Management services Co., Ltd.

南昌小藍長誠物業管理 Nanchang, Property 49% 49% 49% 49% 有限責任公司 the PRC, management Nanchang Xiaolan May 5, 2008 services Changcheng Property Management Co., Ltd.

鄭州湖心島物業服務有限公司 Zhengzhou, Property 49% 49% – – Zhengzhou Huxindao the PRC, management Property Service Co., Ltd. July 4, 2017 services

株洲市新遠城物業服務有限公司 Zhuzhou, Property – 45% 45% 45% Zhuzhou Xinyuancheng the PRC, management Property Service Co., Ltd. July 1, 2019 services

武漢金銀湖長城物業管理 Wuhan, Property – 70% 70% 70% 有限公司 the PRC, management Wuhan Jinyinhu Changcheng September 5, 2019 services Property Management Co., Ltd.

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Attributable equity interest of the Group As at As at December 31, March 31, Place and date of Principal Company name incorporation activities 2018 2019 2020 2021

長城（湘潭）物業管理有限公司 Xiangtan, Property 51% 51% 51% 51% Changcheng (Xiangtan) the PRC, management Property Management Co., June 29, 2018 services Ltd.

山西科創物業管理有限公司 Shanxi, Property – – 49% 49% Shanxi Kechuang Property the PRC, management Management Co., Ltd. May 20, 2020 services

* The English names of the above entities represent the best efforts made by the management of the Company in translating its Chinese names as they do not have official English names.

The directors of the Company consider that none of the joint ventures was significant to the Group and thus the individual financial information of the joint ventures was not disclosed.

As at December 31, 2018, 2019 and 2020 and March 31, 2021, there were no significant contingent liabilities and commitments relating to the Group’s interests in the joint ventures.

20 DEFERRED INCOME TAX

The analysis of deferred income tax assets and liabilities in the consolidated balance sheets was as follows:

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Deferred income tax assets – to be realized within 12 months 222 732 1,299 5,263 – to be realized over 12 months 38,820 54,716 60,670 64,453

39,042 55,448 61,969 69,716

Deferred income tax liabilities – to be realized within 12 months (2,180) (4,218) (4,827) (4,865) – to be realized over 12 months (10,326) (9,276) (8,601) (8,601)

(12,506) (13,494) (13,428) (13,466)

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Allowance for impairment of receivables and assets Accured Lease held for sale expenses liabilities Tax losses Total RMB’000 RMB’000 RMB’000 RMB’000 RMB’000

Deferred income tax assets At January 1, 2018 26,768 – 2,953 – 29,721 Credited – to the profit or loss 8,853 222 246 – 9,321

At December 31, 2018 35,621 222 3,199 – 39,042

At January 1, 2019 35,621 222 3,199 – 39,042 Credited – to the profit or loss 15,781 510 115 – 16,406

At December 31, 2019 51,402 732 3,314 – 55,448

At January 1, 2020 51,402 732 3,314 – 55,448 Credited – to the profit or loss 5,831 567 123 – 6,521

At December 31, 2020 57,233 1,299 3,437 – 61,969

At January 1, 2021 57,233 1,299 3,437 – 61,969 Credited – to the profit or loss 3,772 174 11 3,790 7,747

At March 31, 2021 61,005 1,473 3,448 3,790 69,716

(Unaudited) At January 1, 2020 51,402 732 3,314 – 55,448 Credited/(charged) – to the profit or loss 3,686 151 (280) 2,925 6,482

At March 31, 2020 55,088 883 3,034 2,925 61,930

Deferred income tax assets are recognized for tax losses carried forward to the extent that the realization of the related benefit through future taxable profits is probable. Management will continue to assess the recognition of deferred income tax assets in future reporting periods. The Group did not recognize deferred income tax assets of approximately RMB30,670,000, RMB37,943,000, RMB47,565,000 and RMB53,542,000 as at December 31, 2018, 2019 and 2020 and March 31, 2021 in respect of accumulated tax losses amounting approximately RMB122,681,000, RMB151,773,000, RMB190,261,000 and RMB214,169,000 as at December 31, 2018, 2019 and 2020 and March 31, 2021 in certain of the Group’s subsidiaries, which can be carried forward to offset against future taxable income, all of which will expire in year 2023, 2024, 2025 and 2026, respectively.

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Fair value changes of investment properties and wealth Revaluation management surplus products Total RMB’000 RMB’000 RMB’000

Deferred income tax liabilities At January 1, 2018 ––– Charged – to profit or loss – (2,180) (2,180) – to other comprehensive income (10,326) – (10,326)

At December 31, 2018 (10,326) (2,180) (12,506)

At January 1, 2019 (10,326) (2,180) (12,506) Credited/(charged) – to profit or loss – (2,038) (2,038) – to other comprehensive income 1,050 – 1,050

At December 31, 2019 (9,276) (4,218) (13,494)

At January 1, 2020 (9,276) (4,218) (13,494) Credited/(charged) – to profit or loss – (609) (609) – to other comprehensive income 675 – 675

At December 31, 2020 (8,601) (4,827) (13,428)

At January 1, 2021 (8,601) (4,827) (13,428) Charged – to profit or loss – (38) (38)

At March 31, 2021 (8,601) (4,865) (13,466)

(Unaudited) At January 1, 2020 (9,276) (4,218) (13,494) Credited/(charged) – to profit or loss – (225) (225) – to other comprehensive income 225 – 225

At March 31, 2020 (9,051) (4,443) (13,494)

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21 INVENTORIES

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Consumables – 1,847 2,788 5,583

Inventories recognized as an expense charged to the consolidated statements of comprehensive income during the years ended December 31, 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021 amounted to approximately RMB58,127,000, RMB109,673,000, RMB133,352,000, RMB9,501,000 and RMB16,750,000 respectively.

22 FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Wealth management products (a) 48,509 17,575 46,789 61,817

(a) The wealth management products are denominated in RMB, with expected rates of returns ranging from 3.0%-4.2%, 2.9%-4.2%, 1.6%-2.9% and 2.1%-3.7% per annum for the years ended December 31, 2018, 2019 and 2020 and the three months ended March 31, 2021, respectively. The returns on all these wealth management products are not guaranteed, as a result their contractual cash flows do not qualify solely as payments of principal and interest. Therefore, they are measured at fair value through profit or loss.

The fair values are based on cash flow discounted using the expected return based on management’s judgment and are within level 3 of the fair value hierarchy (Note 3.3).

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23 FINANCIAL INSTRUMENTS BY CATEGORY

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Financial assets Financial assets at amortized cost: Cash and cash equivalents (Note 27) 530,299 523,733 514,213 366,363 Restricted bank deposits (Note 27) 5,859 6,799 9,912 8,539 Trade and other receivables (Note 24) 676,147 748,137 883,730 1,086,578 Payments on behalf of residents (Note 26) 79,138 61,694 60,000 63,182

1,291,443 1,340,363 1,467,855 1,524,662

Financial assets at fair value through profit or loss (Note 22) 48,509 17,575 46,789 61,817

Financial liabilities Financial liabilities at amortized cost: Trade and other payables excluding non-financial liabilities (Note 31) 817,370 839,221 838,827 1,002,802 Receipts on behalf of residents (Note 26) 145,949 127,178 142,120 151,921 Bank borrowings (Note 33) 166,416 158,566 153,766 149,516 Lease liabilities (Note 15) 95,492 79,336 79,251 74,950

1,225,227 1,204,301 1,213,964 1,379,189

Financial liabilities at fair value: Redeemable shares (Note 34) 569,358 562,255 – –

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24 TRADE AND OTHER RECEIVABLES

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Trade receivables – Related parties (Note 36(b)) 2,380 2,735 6,930 8,794 – Third parties 734,622 808,892 876,083 1,074,566 737,002 811,627 883,013 1,083,360

Less: allowance for impairment of trade receivables (122,251) (180,537) (192,800) (206,137)

614,751 631,090 690,213 877,223

Other receivables – Payments made on behalf of customers 32,277 81,797 130,242 143,873 – Deposits 25,794 35,996 50,918 52,801 – Amounts due from related parties (Note 36(b)) 20,324 15,235 39,985 42,608 – Notes receivable 1,000 3,500 1,500 1,500 Less: allowance for impairment of other receivables (17,999) (19,481) (29,128) (31,427)

61,396 117,047 193,517 209,355

676,147 748,137 883,730 1,086,578

The following is an aging analysis of trade receivables presented based on invoice date:

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

737,002 811,627 883,013 1,083,360

The Group applies the simplified approach to provide for expected credit losses prescribed by HKFRS 9. Details are set out in Note 3.1.2.

The Group’s trade receivables were denominated in RMB.

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25 PREPAYMENTS

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Included in current assests: Prepayments to suppliers 109,668 85,182 105,896 120,240 Prepayments for [REDACTED] expenses – – – [REDACTED] Prepaid taxes 4,000 8,189 8,713 6,836

113,668 93,371 114,609 [REDACTED]

Included in non-current assests: Prepayments for property, plant and equipment 5,342 4,268 1,713 440 Prepayments for intangible assets 3,650 9,863 1,739 4,072

8,992 14,131 3,452 4,512

26 PAYMENTS/RECEIPTS ON BEHALF OF RESIDENTS

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Net receivable 79,138 61,694 60,000 63,182

Net payable (145,949) (127,178) (142,120) (151,921)

The balances represent the current accounts with the property management offices of residential communities managed by the Group under the terms of commission basis. These management offices of residential communities usually have no separate bank accounts because these property management offices have no separate legal identity. For the daily management of these property management offices of the residential communities, all transactions of these management offices, including the collection of property management fees and the settlement of daily expenditures, were settled through the treasury function of group entities. A net receivable balance from the property management office of the residential community represents expenditures paid by the Group on behalf of the residential community in excess of the property management fees collected from the residents of that residential community. A net payable balance to the property management office of the residential community represents property management fee collected from residents of the residential community in excess of the expenditure paid by the Group on behalf of the residential communities.

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27 Cash and cash equivalents and restricted bank deposits

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Cash at banks and on hand 536,158 530,532 524,125 374,902 Less: Restricted bank deposits (c) (5,859) (6,799) (9,912) (8,539)

Cash and cash equivalents 530,299 523,733 514,213 366,363

(a) All cash and cash equivalents are denominated in RMB.

(b) The bank balances carry interest at variable rates with an average interest rate of 0.3% per annum throughout the Track Record Period.

(c) Restricted bank deposits mainly represents the cash deposits in bank as performance security for property management services according to the requirements of local government authorities.

(d) As at December 31, 2018, 2019 and 2020 and March 31, 2021, cash and cash equivalents did not include housing maintenance funds of approximately RMB19,289,000, RMB16,796,000, RMB16,444,000 and RMB17,308,000 which were owned by the property owners but were deposited in the bank accounts in the name of the Group. Such deposits can be used by the Group for the purpose of public maintenance expenditures upon the approval from the relevant government authorities.

28 ASSETS HELD FOR SALE

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Assets held for sale – Cost 97,072 179,304 175,789 174,814 – Accumulated impairment losses (20,010) (28,429) (30,241) (30,402)

77,062 150,875 145,548 144,412

– I-73 – THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. APPENDIX I ACCOUNTANT’S REPORT

The properties classified as assets held for sale represented the properties in the PRC received from certain real estate developer customers in exchange for property management services payable to the Group (recorded in trade receivables) by these customers. The Group’s intention is to sell these properties and, accordingly, these properties are classified as assets held for sale if the related properties are ready to be sold.

Management assessed the fair value less costs to sell of these properties with reference to their market value with the assistance of an independent property valuer. Valuation methodologies used in the valuation included direct market comparable approach which is within level 2 of the fair value hierarchy. For direct market comparable approach, observable inputs other than quoted prices within level 1 included market price of comparable properties adjusted having regard to the location, size and nature of the properties (level 2). There were no transfers between levels 1, 2 and 3 for recurring fair value measurements during the Track Record Period. For the years ended December 31, 2018, 2019, 2020 and the three months period ended March 31, 2021, the management compared the carrying amount and fair value less costs to sell of the properties and recognized impairment loss accordingly.

Cash flows associated with the disposal of properties held for sale are presented under “Operating activities” in the consolidated statements of cash flows. The impairment losses of properties held for sale are recorded in “administrative expenses” in the consolidated statements of comprehensive income.

29 SHARE CAPITAL

Equivalent Number of nominal value shares of shares RMB’000

Issued and fully paid: At January 1, 2018 78,334,000 78,334 Transfer to redeemable shares (Note 34) (10,111,000) (10,111)

At December 31, 2018 and 2019 68,223,000 68,223 Transfer from redeemable shares (Note 34) 13,321,000 13,321

At December 31, 2020 and March 31, 2021 81,544,000 81,544

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30 OTHER RESERVES

Merger Revaluation Statutory Capital reserve surplus reserves reserves Total RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 Note (a) Note (b)

At January 1, 2018 10,000 – 19,057 (55,489) (26,432) Capital injection from the then shareholder – – – 26,309 26,309 Transfer to statutory reserves – – 9,722 – 9,722 Effects of transfer of ordinary shares with preference rights to redeemable shares (Note 34) – – – (456,588) (456,588) Revaluation – 41,305 – – 41,305 Deferred tax – (10,326) – – (10,326)

At December 31, 2018 10,000 30,979 28,779 (485,768) (416,010)

At January 1, 2019 10,000 30,979 28,779 (485,768) (416,010) Transfer to statutory reserves – – 8,338 – 8,338 Revaluation – (4,200) – – (4,200) Deferred tax – 1,050 – – 1,050

At December 31, 2019 10,000 27,829 37,117 (485,768) (410,822)

At January 1, 2020 10,000 27,829 37,117 (485,768) (410,822) Transfer to statutory reserves – – 10,758 – 10,758 Effects of transfer of redeemable shares to ordinary shares upon termination of preference rights (Note 34) – – – 548,596 548,596 Revaluation – (2,700) – – (2,700) Deferred tax – 675 – – 675

At December 31, 2020 10,000 25,804 47,875 62,828 146,507

At January 1, 2021 10,000 25,804 47,875 62,828 146,507 Transfer to statutory reserves – – 5,798 – 5,798 Deemed distribution arising from business combination under common control (109,256) – – – (109,256)

At March 31, 2021 (99,256) 25,804 53,673 62,828 43,049

(Unaudited) At January 1, 2020 10,000 27,829 37,117 (485,768) (410,822) Transfer to statutory reserves – – 4,746 – 4,746 Revaluation – (900) – – (900) Deferred tax – 225 – – 225

At March 31, 2020 10,000 27,154 41,863 (485,768) (406,751)

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(a) It was arising from the acquisition of the shares of Chengji Ruishang as at March 31, 2021 (Note 1), which represents the excess of the cash consideration paid over the paid-in capital of Foshan Chengji Ruishang. The acquisition has been accounted for as business combination under common control.

(b) Pursuant to the relevant rules and regulations governing foreign investment enterprise established in the PRC and the articles of association of certain PRC subsidiaries of the Group, the subsidiaries are required to transfer 10% of their profit after taxation to the statutory reserve fund, until the accumulated total of the fund reaches 50% of their respective registered capital.

31 TRADE AND OTHER PAYABLES

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Trade payables (a) – Related parties (Note 36(b)) 4,250 5,295 6,014 7,346 – Third parties 293,146 386,233 448,007 492,881

297,396 391,528 454,021 500,227

Other payables – Accrued payroll 125,405 172,754 221,977 218,277 – Deposits 170,218 181,584 155,118 159,782 – Income from common area received on behalf of property owners 45,457 73,403 99,471 107,703 – Advances received in relation to sales of assets held for sale 28,878 59,280 69,882 68,583 – Utility and other payables (b) 90,079 50,006 39,333 26,367 – Amounts due to related parties (Note 36(b)) 31,638 10,570 6,851 6,604 – Other taxes payables 40,295 10,522 6,449 6,122 – Consideration payable for business combination under common control (Note 1) – – – 109,256 – [REDACTED] expenses – – – [REDACTED] – Others 153,704 72,850 14,151 15,898

685,674 630,969 613,232 [REDACTED]

983,070 1,022,497 1,067,253 [REDACTED]

(a) The following is an aging analysis of trade payables presented based on the invoice date:

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Up to 1 year 249,033 294,387 340,732 410,374 1 to 2 years 32,773 65,195 82,299 61,561 2 to 5 years 11,529 25,715 28,153 25,303 Over 5 years 4,061 6,231 2,837 2,989

297,396 391,528 454,021 500,227

(b) The balances represented receipts from customers to settle their utility bills and other charges on their behalf.

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32 DIVIDENDS

During the years ended December 31, 2018, 2019 and 2020, the Company declared and paid dividends of approximately RMB111,715,000, RMB46,678,000 and RMB52,426,000, respectively. In April 2021, the Company declared dividend in the amount of approximately RMB102,745,000 to be paid to its existing shareholders.

During the years ended December 31, 2018, 2019 and 2020, certain subsidiaries of the Group distributed dividends of approximately RMB767,000, RMB1,323,000 and RMB977,000 in total to their non-controlling shareholders. In April 2021, a subsidiary of the Group declared dividend in the amount of RMB2,240,000, of which RMB896,000 will be payable to the Group’s non-controlling shareholders.

The above dividends declared in April 2021 have not been reflected as dividend payable in the consolidated balance sheet as at March 31, 2021.

33 BORROWINGS

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Non-current Secured bank loans 46,416 38,566 33,766 29,516 Less: current portion of non-current borrowings (7,850) (4,800) (17,000) (17,000)

38,566 33,766 16,766 12,516

Current Secured bank loans 120,000 120,000 120,000 120,000 Add: current portion of non-current borrowings 7,850 4,800 17,000 17,000

127,850 124,800 137,000 137,000

Total borrowings 166,416 158,566 153,766 149,516

As at December 31, 2018, 2019, and 2020 and March 31, 2021, the secured bank loans of the Group were secured by:

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Certificate of deposits 500 500 500 500 Buildings (Note 14) 9,239 8,651 8,063 7,916 Investment properties (Note 16) 243,137 247,631 249,355 250,735

252,876 256,782 257,918 259,151

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The borrowings are repayable as follows:

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Within 1 year 127,850 124,800 137,000 137,000 Between 1 and 2 years 38,566 17,000 16,766 12,516 Between 2 and 5 years – 16,766 – –

166,416 158,566 153,766 149,516

The weighted average effective interest rate for the years ended December 31, 2018, 2019 and 2020 and the three months ended March 31, 2021 were 5.62%, 5.46%, 5.08% and 5.00%, respectively.

34 REDEEMABLE SHARES

Pursuant to the relevant investment agreements, Shanghai Luyuan, holding 2.88% of the Company’s shares as at January 1, 2018, and Shengmei Tongying, holding 16.34% of the Company’s shares as at December 31, 2018 and 2019, were entitled to certain preference rights. Based on the assessment of the host instruments and the preference rights embedded, the Group did not bifurcate any embedded derivatives from the host instruments and designated the entire instruments as financial liabilities at fair value through profit or loss, namely redeemable shares, with the changes in the fair value recorded in the consolidated statements of comprehensive income.

The preference rights that were relevant to the assessment of the classification of the redeemable shares are summarized as follows:

(a) Redemption rights

If the Company did not meet the committed profit targets from 2017 to 2020 which were agreed in the investment agreement or would not complete the submission of listing application by June 30, 2019, at the option of the redeemable shareholders, the Company should redeem all, but not less than all, of the issued redeemable shares held by the redeemable shareholder out of funds legally available for the Company or the original shareholders before the issuance of such redeemable shares.

The redemption price should be paid by the Company to the redeemable shares holder in the amount equaling to 100% of issue price, plus a 10% per annum interest of issue price accrued during the period from the issue date of each redeemable share until the date stated on redemption notice on which the redeemable shares were to be redeemed.

(b) Anti-dilution rights

If the investment price or cost paid by any new investor was lower than the investment price or cost of the redeemable shareholder, the original shareholders, the Company or the management of the Company shall insure the redeemable shareholder has the right to require an increase of its shares by additional capital injection at a nominal price or free of charge until the investment price of the redeemable shareholder was the same as the investment price of the new investor.

– I-78 – THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. APPENDIX I ACCOUNTANT’S REPORT

The movements of the redeemable shares are set out as below:

RMB’000

At January 1, 2018 (i) 96,152 Transfer from ordinary shares with preference rights (ii) 466,699 Fair value changes 6,507

At December 31, 2018 (iii) 569,358

At January 1, 2019 569,358 Fair value changes (7,103)

At December 31, 2019 (iii) 562,255

At January 1, 2020 562,255 Fair value changes (338) Transfer to equity upon termination of preference rights (ii) (561,917)

At December 31, 2020 –

(Unaudited) At January 1, 2020 562,255 Fair value changes (4,262)

At March 31, 2020 557,993

(i) The redeemable shares as at January 1, 2018 represented the fair value of the 2.88% of the shares of the Company held by Shanghai Luyuan.

(ii) The amount of transfer from ordinary shares in 2018 represented the aggregated fair values of the 11.34% and 5% shares of the Company transferred to Shengmei Tongying as at January 22, 2018 and March 2, 2018, respectively, of which approximately RMB10,111,000 was debited to ordinary shares, and RMB456,588,000 was debited to capital reserves.

The amount of transfer to equity in 2020 represented the fair value of the 16.34% shares of the Company held by Shengmei Tongying as at July 2, 2020 when the preference rights were terminated, of which approximately RMB13,321,000 was credited to ordinary shares, and RMB548,596,000 was credited to capital reserves.

(iii) The redeemable shares were classified as a current liability as at December 31, 2018 and 2019 as the Group did not have the unconditional right to defer the redemption for at least 12 months as at December 31, 2018 and 2019.

Key valuation assumptions used to determine the fair value of redeemable shares are as follows:

As at As at As at As at January 22, March 2, As at December 31, March 31, July 2, 2018 2018 2018 2019 2020 2020 (Unaudited)

Discount rate 12.5% 12.5% 14.0% 14.2% 15.0% 14.8% Risk-free interest rate 3.7% 3.6% 3.0% 2.9% 1.6% 2.0% Discount for lack of marketability 15.8% 15.8% 15.8% 15.8% 15.8% 15.8% Discount for lack of control 11.3% 11.3% 11.3% 11.3% 11.3% 11.3% Volatility 51.4% 52.0% 44.5% 40.3% 46.1% 51.0%

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35 CASH FLOW INFORMATION

(a) Cash generated from/(used in) operations

Reconciliation from profit before income tax to cash generated from/(used in) operations:

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Profit before income tax 110,409 185,721 287,350 66,295 76,826

Adjustment for: Interest expenses (Note 11) 14,560 12,674 12,021 2,977 2,757 Interest income (Note 11) (3,333) (4,681) (3,363) (1,103) (771) Depreciation of property, plant and equipment (Note 14) 29,300 31,535 31,316 8,734 7,479 Depreciation of right-of-use assets (Note 15) 8,798 10,712 16,982 4,105 4,639 Fair value gains on investment properties (Note 8) (8,720) (10,846) (5,134) (1,574) (824) Amortization of intangible assets (Note 17) 8,779 9,037 8,307 910 1,222 Net (gains)/losses on disposal of property, plant and equipment, intangible assets and investment properties (Note 8) (1,540) (422) (457) 25 (4,396) Net impairment losses on financial assets (Note 3.1.2) 35,411 63,123 23,694 12,932 15,084 Share of (profits)/losses of investments accounted for using equity method (Note 19) (4,014) (9,369) (9,778) (428) 1,095 Fair value changes of redeemable shares (Note 34) 6,507 (7,103) (338) (4,262) – Unrealized fair value gains on financial assets at fair value through profit or loss (Note 8) (59) (18) (42) (308) (66) Impairment of assets held for sale (Note 9) 1,892 8,419 1,812 – 161

Operating cash flows before changes in working capital 197,990 288,782 362,370 88,303 103,206

Changes in working capital: Inventories 18 (1,847) (941) (1,795) (2,795) Restricted bank deposits (5,176) (940) (3,113) 5,898 1,373 Payments on behalf of residents (20,441) 17,444 1,694 1,286 (3,182) Trade and other receivables (91,060) (221,731) (134,067) (175,267) (215,267) Finance lease receivables (7,988) 2,424 2,685 865 721 Prepayments (25,780) 20,297 (21,238) (6,647) (12,458) Contract liabilities (117,342) 47,172 (4,596) (66,906) (47,141) Trade and other payables 118,415 60,495 51,990 104,461 44,523 Receipts on behalf of residents 49,389 (18,771) 14,942 (21,167) 9,801

Cash generated from/(used in) operations 98,025 193,325 269,726 (70,969) (121,219)

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(b) In the consolidated statements of cash flows, proceeds from disposal of property, plant and equipment, intangible asstes and investment properties comprise:

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Net book amount 6,427 1,725 15,533 160 10,935 Net losses/(gains) on disposal of property, plant and equipment, intangible assets and investment properties (Note 8) 1,540 422 457 (25) 4,396 Proceeds from disposal of property, plant and equipment, intangible assets and investment properties 7,967 2,147 15,990 135 15,331

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Additions of right-of-use assets (Note 15) – 6,237 24,668 9,825 103

Properties received in exchange for outstanding trade receivables (Note 28) 48,364 102,180 22,184 – –

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(d) This section sets out an analysis of the movements in liabilities from financing activities:

Amounts Bank Lease due to borrowings liabilities related parties RMB’000 RMB’000 RMB’000

Balance as at January 1, 2018 148,416 111,758 30,314 Cash flows 18,000 (21,720) 1,324 Interest expenses – 5,454 –

Balance as at December 31, 2018 166,416 95,492 31,638

Balance as at January 1, 2019 166,416 95,492 31,638 Cash flows (7,850) (26,980) (21,068) Additions – 6,237 – Interest expenses – 4,587 –

Balance as at December 31, 2019 158,566 79,336 10,570

Balance as at January 1, 2020 158,566 79,336 10,570 Cash flows (4,800) (28,737) (3,719) Additions – 24,668 – Interest expenses – 3,984 –

Balance as at December 31, 2020 153,766 79,251 6,851

Balance as at January 1, 2021 153,766 79,251 6,851 Cash flows (4,250) (5,248) (247) Interest expenses – 844 – Additions – 103 –

Balance as at March 31, 2021 149,516 74,950 6,604

(Unaudited) Balance as at January 1, 2020 158,566 79,336 10,570 Cash flows (1,413) (5,731) (3,089) Additions – 9,825 – Interest expenses – 1,068 –

Balance as at March 31, 2020 157,153 84,498 7,481

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36 RELATED PARTY TRANSACTIONS

(a) Transactions with related parties

During the Track Record Period, save as disclosed elsewhere in this report, the following is a summary of the significant transactions carried out between the Group and its related parties.

Three months ended Year ended December 31, March 31, 2018 2019 2020 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Unaudited)

Revenue from rendering of services – Centralcon Capital and its subsidiaries 375 827 528 120 120 – Shenzhen Jiaye Investment – 37––– – Joint ventures 5,053 8,611 13,326 1,033 2,167

5,428 9,475 13,854 1,153 2,287

Purchase of services – Centralcon Capital 5,719 5,719 1,152 338 – – Joint ventures 24,206 20,626 18,876 4,933 1,666

29,925 26,345 20,028 5,271 1,666

Lease of carpark spaces – Centralcon Capital – – 4,762 1,190 1,190

Transactions with related companies are determined based on terms mutually agreed between the relevant parties.

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(b) Balances with related parties

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Amounts due from/to related parties Trade receivables – Centralcon Capital and its subsidiaries 40 68 89 324 – Changcheng Property Group Co., Ltd. Trade Union Committee (長城物業集團股份有限公司工會委員會) (the “Trade Union”)–404040 – Joint ventures 2,340 2,627 6,801 8,430

2,380 2,735 6,930 8,794

Other receivables – Shenzhen Jiaye Investment 11,693 5,795 28,079 29,334 – The Trade Union 8,145 8,145 8,145 8,145 – Joint ventures 486 1,295 3,761 5,129

20,324 15,235 39,985 42,608

Trade payables – Centralcon Capital – – 5,000 6,283 – Joint ventures 4,250 5,295 1,014 1,063

4,250 5,295 6,014 7,346

Other payables – Centralcon Capital and its subsidiaries 10,495 10,555 6,594 6,594 – Shenzhen Jiaye Investment 20,993 – – – – Joint ventures 150 15 257 10

31,638 10,570 6,851 6,604

Contract liabilities – Centralcon Capital and its subsidiaries – 23 – – – Joint ventures – 33 – –

–56––

As at December 31, 2018, 2019 and 2020 and March 31, 2021, the above balances were unsecured, interest-free, and collectable on demand and are denominated in RMB.

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37 COMMITMENTS

(a) Operating commitments

The Group leases certain offices and staff dormitories under non-cancellable operating lease agreements with lease terms less than 1 year, which can be exempt from HKFRS 16. The future aggregate minimum lease payments under non-cancellable operating leases were as follows:

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

No later than 1 year 5,880 7,544 7,332 7,007

(b) Capital commitments

The Group did not have any material capital commitments as at December 31, 2018, 2019 and 2020 and March 31, 2021.

38 BUSINESS COMBINATIONS

During the Track Record Period, the Group acquired certain insignificant subsidiaries with total cash consideration of approximately RMB3,677,000, which approximated the fair values of net assets acquired and thus no goodwill was recognized by the Group.

The revenue and the results contributed by the acquired subsidiaries during the Track Record Period since respective acquisition date were insignificant to the Group.

39 NOTES TO BALANCE SHEETS OF THE COMPANY

(a) Investments in subsidiaries

Investments in subsidiaries represent the cost of investments in subsidiaries. The principal subsidiaries are disclosed in Note 18.

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(b) Property, plant and equipment

Motor Leasehold Electronic Construction Buildings Machinery Vehicles improvements equipment in progress Total RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000

At January 1, 2018 Cost 83,968 354 5,366 29,114 49,529 – 168,331 Accumulated depreciation (27,009) (137) (3,832) (14,477) (34,452) – (79,907)

Net book amount 56,959 217 1,534 14,637 15,077 – 88,424

Year ended December 31, 2018 Opening net book amount 56,959 217 1,534 14,637 15,077 – 88,424 Additions 11,035 527 827 5,922 9,722 – 28,033 Transfer from investment properties 5,230 –––––5,230 Transfer to investment properties (20,495) ~ ––––(20,495) Disposals (5,995) – – – (330) – (6,325) Depreciation (4,415) (197) (536) (5,559) (7,401) – (18,108)

Closing net book amount 42,319 547 1,825 15,000 17,068 – 76,759

At December 31, 2018 Cost 57,998 881 6,193 35,036 45,905 – 146,013 Accumulated depreciation (15,679) (334) (4,368) (20,036) (28,837) – (69,254)

Net book amount 42,319 547 1,825 15,000 17,068 – 76,759

Year ended December 31, 2019 Opening net book amount 42,319 547 1,825 15,000 17,068 – 76,759 Additions 5,195 504 967 13,132 7,988 1,800 29,586 Disposals (1,377) – (3) – – – (1,380) Depreciation (3,398) (187) (740) (5,809) (8,171) – (18,305)

Closing net book amount 42,739 864 2,049 22,323 16,885 1,800 86,660

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Motor Leasehold Electronic Construction Buildings Machinery Vehicles improvements equipment in progress Total RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000

At December 31, 2019 Cost 61,815 1,385 6,784 48,168 53,893 1,800 173,845 Accumulated depreciation (19,076) (521) (4,735) (25,845) (37,008) – (87,185) Net book amount 42,739 864 2,049 22,323 16,885 1,800 86,660

Year ended December 31, 2020 Opening net book amount 42,739 864 2,049 22,323 16,885 1,800 86,660 Transfers upon completion 14,093 4,395 491 10,469 8,610 4,850 42,908 Additions – – – 2,119 1,867 (3,986) – Disposals (9,386) – (19) – (361) – (9,766) Depreciation (2,118) (535) (712) (6,188) (8,060) – (17,613) Closing net book amount 45,328 4,724 1,809 28,723 18,941 2,664 102,189

At December 31, 2020 Cost 65,699 5,780 6,739 60,756 59,174 2,664 200,812 Accumulated depreciation (20,371) (1,056) (4,930) (32,033) (40,233) – (98,623)

Net book amount 45,328 4,724 1,809 28,723 18,941 2,664 102,189

Three months ended March 31, 2021 Opening net book amount 45,328 4,724 1,809 28,723 18,941 2,664 102,189 Additions – 835 18 500 – 1,018 2,371 Disposal (273) –––––(273) Depreciation (849) (984) (163) (2,251) (452) – (4,699)

Closing net book amount 44,206 4,575 1,664 26,972 18,489 3,682 99,588

At March 31, 2021 Cost 65,425 6,615 6,757 61,256 59,174 3,682 202,909 Accumulated depreciation (21,219) (2,040) (5,093) (34,284) (40,685) – (103,321)

Net book amount 44,206 4,575 1,664 26,972 18,489 3,682 99,588

The Company’s buildings were located in the PRC. Buildings with net book amount of approximately RMB9,239,000, RMB8,651,000, RMB8,063,000 and RMB7,916,000 as at December 31, 2018, 2019, 2020 and March 31, 2021 were pledged as collateral for the Company’s bank borrowings (Note 39(m)).

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(i) Right-of-use assets

The following tables show the movements of right-of-use assets during the Track Record Period:

Properties RMB’000

As at January 1, 2018 Cost 94,341 Accumulated depreciation (9,712)

Net book amount 84,629

Year ended December 31, 2018 Opening net book amount 84,629 Depreciation (8,422) Disposals (5,391)

Closing net book amount 70,816

As at January 1, 2019 Cost 88,150 Accumulated depreciation (17,334)

Net book amount 70,816

Year ended December 31, 2019 Opening net book amount 70,816 Additions 1,772 Depreciation (9,120) Disposals (644)

Closing net book amount 62,824

As at January 1, 2020 Cost 89,153 Accumulated depreciation (26,329)

Net book amount 62,824

Year ended December 31, 2020 Opening net book amount 62,824 Additions 10,692 Depreciation (13,374) Disposals (452)

Closing net book amount 59,690

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Properties RMB’000

As at January 1, 2021 Cost 99,276 Accumulated depreciation (39,586)

Net book amount 59,690

Three month ended March 31, 2021 Opening net book amount 59,690 Additions 103 Depreciation (3,256)

Closing net book amount 56,537

As at March 31, 2021 Cost 99,379 Accumulated depreciation (42,842)

Net book amount 56,537

(ii) Lease liabilities

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Lease liabilities – Current 22,372 23,841 23,819 23,494 – Non-current 37,943 23,034 19,011 17,934

60,315 46,875 42,830 41,428

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(d) Investment properties

Three months ended Year ended December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

At fair value Opening balance 14,810 71,600 67,800 64,600 Fair value change recognized in profit or loss 220 400 (500) (100) Fair value change recognized in other comprehensive income – (4,200) (2,700) – Transfer to property, plant and equipment (5,230) – – – Transfer from property, plant and equipment – Revaluation gains 41,305 – – – – Cost 20,495 – – –

Closing balance 71,600 67,800 64,600 64,500

Investment properties with fair value of approximately RMB61,800,000, RMB57,600,000, RMB54,900,000 and RMB54,900,000 as at December 31, 2018, 2019, 2020 and March 31, 2021 were pledged as collateral for the Company’s bank borrowings (Note 39(m)).

(e) Prepayments

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Included in current assests: Prepayments to suppliers 83,674 51,381 63,425 75,390 Prepayments for [REDACTED] expenses – – – [REDACTED] Prepaid taxes 4,000 6,224 6,219 4,461

87,674 57,605 69,644 [REDACTED]

Included in non-current assests: Prepayments for property, plant and equipment 5,342 4,268 1,713 440 Prepayments for intangible assets 2,651 8,865 337 2,670

7,993 13,133 2,050 3,110

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(f) Trade and other receivables

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Included in current assets Trade receivables – Related parties 720 1,860 1,258 1,682 – Third parties 537,771 600,495 649,794 830,142

538,491 602,355 651,052 831,824

Less: allowance for impairment of trade receivables (90,613) (130,978) (141,657) (156,962)

447,878 471,377 ‘509,395 674,862

Other receivables – Payments made on behalf of customers 31,191 74,770 100,745 111,530 – Dividends 65,801 66,368 65,786 65,786 – Deposits 23,268 32,404 45,908 47,537 – Amounts due from related parties 42,912 9,440 11,905 13,273 – Notes receivable – 3,500 500 500 Less: allowance for impairment of other receivables (14,851) (16,412) (21,759) (23,771)

148,321 170,070 203,085 214,855

596,199 641,447 712,480 889,717

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The following is an ageing analysis of trade receivables presented based on invoice date:

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Up to 1 year 274,340 301,799 273,720 451,826 1 to 2 years 126,092 130,126 185,100 150,031 2 to 3 years 53,459 64,861 76,742 102,304 3 to 4 years 29,981 36,307 36,815 37,372 4 to 5 years 29,452 26,392 23,570 34,413 Over 5 years 25,167 42,870 55,105 55,878

538,491 602,355 651,052 831,824

The Company’s trade receivables were denominated in RMB.

(g) Payments/Receipts on behalf of residents

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Net receivable 69,996 56,316 55,536 57,671

Net payable (128,049) (106,387) (117,228) (124,017)

The balances represent the current accounts with the property management offices of residential communities managed by the Company under the terms of commission basis. These management offices of residential communities usually have no separate bank accounts because these property management offices have no separate legal identity. For the daily management of these property management offices of the residential communities, all transactions of these management offices, including the collection of property management fees and the settlement of daily expenditures, were settled through the treasury function of group entities. A net receivable balance from the property management office of the residential community represents expenditures paid by the Company on behalf of the residential community in excess of the property management fees collected from the residents of that residential community. A net payable balance to the property management office of the residential community represents property management fee collected from residents of the residential community in excess of the expenditure paid by the Company on behalf of the residential communities.

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(h) Cash and cash equivalents and restricted bank deposits

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Cash at banks and on hand 372,060 405,946 418,411 282,008 Less: Restricted bank deposits (iii) (1,324) (5,763) (9,357) (7,990)

Cash and cash equivalents 370,736 400,183 409,054 274,018

(i) All cash and cash equivalents are denominated in RMB.

(ii) The bank balances carry interest at variable rates with an average interest rate of 0.3% per annum throughout the Track Record Period.

(iii) Restricted bank deposits mainly represents the cash deposits in bank as performance security for property management services according to the requirements of local government authorities.

(iv) As at December 31, 2018, 2019 and 2020 and March 31, 2021, cash and cash equivalents did not include housing maintenance funds of approximately RMB18,418,000, RMB15,925,000, RMB15,749,000 and RMB16,408,000 which were owned by the property owners but were deposited in the bank accounts in the name of the Company. Such deposits can be used by the Company for the purpose of public maintenance expenditures upon the approval from the relevant government authorities.

(i) Assets held for sale

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Assets held for sale – Cost 59,445 142,184 130,877 129,903 – Accumulated impairment losses (2,687) (7,241) (9,052) (9,214)

56,758 134,943 121,825 120,689

The properties classified as assets held for sale represented the properties in the PRC received from certain real estate developer customers in exchange for property management services payable to the Company (recorded in trade receivables) by these customers. The Company’s intention is to sell these properties and, accordingly, these properties are classified as assets held for sale if the related properties are ready to be sold.

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(j) Other reserves

Revaluation Statutory Capital Other surplus reserves reserves reserves Total RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 Note (i)

At January 1, 2018 – 19,057 (88,042) – (68,985) Capital injection from the then shareholder – – 26,309 – 26,309 Transfer to statutory reserves – 9,722 – – 9,722 Effects of transfer of ordinary shares with preference rights to redeemable shares (Note 34) – – (456,588) – (456,588) Revaluation 41,305 – – – 41,305 Deferred tax (10,326) – – – (10,326)

At December 31, 2018 30,979 28,779 (518,321) – (458,563)

At January 1, 2019 30,979 28,779 (518,321) – (458,563) Transfer to statutory reserves – 8,338 – – 8,338 Revaluation (4,200) – – – (4,200) Deferred tax 1,050 – – – 1,050

At December 31, 2019 27,829 37,117 (518,321) – (453,375)

At January 1, 2020 27,829 37,117 (518,321) – (453,375) Transfer to statutory reserves – 10,758 – – 10,758 Effects of transfer of redeemable shares to ordinary shares upon termination of preference rights (Note 34) – – 548,596 – 548,596 Revaluation (2,700) – – – (2,700) Deferred tax 675 – – – 675

At December 31, 2020 25,804 47,875 30,275 – 103,954

At January 1, 2021 – 47,875 30,275 – 103,954 Transfer to statutory reserves – 5,798 – – 5,798 Deemed distribution arising from business combination under common control – – – (109,256) (109,256)

At March 31, 2021 25,804 53,673 30,275 (109,256) 496

(i) Pursuant to the relevant rules and regulations governing foreign investment enterprise established in the PRC and the articles of association of certain PRC subsidiaries of the Company, the subsidiaries are required to transfer 10% of their profit after taxation to the statutory reserve fund, until the accumulated total of the fund reaches 50% of their respective registered capital.

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(k) Trade and other payables

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Trade payables – Related parties 4,518 4,571 5,313 5,952 – Third parties 213,364 280,226 320,993 372,468

217,882 284,797 326,306 378,420

Other payables – Accrued payroll 79,616 119,249 144,961 145,305 – Deposits 141,129 150,855 91,573 110,305 – Income from common area received on behalf of residents 36,718 59,277 77,861 84,150 – Advances received in relation to sales of assets held for sale 24,003 50,350 59,820 58,365 – Utility and other payables (i) 64,711 36,233 25,035 12,661 – Other taxes payables 29,839 41,886 16,173 26,104 – Consideration payable for business combination under common control – – – 109,256 – [REDACTED] expenses – – – [REDACTED] – Others 108,829 5,939 6,145 6,404

484,845 463,789 421,568 [REDACTED]

702,727 748,586 747,874 [REDACTED]

The following is an aging analysis of trade payables presented based on the invoice date:

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Up to 1 year 189,835 228,891 253,052 323,688 1 to 2 years 15,608 37,415 60,777 44,037 2 to 5 years 9,412 13,424 11,090 9,624 Over 5 years 3,027 5,067 1,387 1,071

217,882 284,797 326,306 378,420

(i) The balances represented receipts from customers to settle their utility bills and other charges on their behalf.

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(l) Contract liabilities

The Company has recognized the following liabilities related to contracts with customers:

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Contract liabilities 119,834 170,560 163,679 116,101

Contract liabilities of the Company mainly arise from the advance payments made by customers while the underlying services are yet to be provided. The increase in contract liabilities from December 31, 2018 to December 31, 2019 and 2020 was mainly due to the growth of the Company’s business while the decrease from December 31, 2020 to March 31, 2021 was mainly due to the seasonal factors.

(m) Borrowings

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Secured bank loans 120,000 120,000 120,000 120,000

As at December 31, 2018, 2019, and 2020 and March 31, 2021, the secured bank loans of the Group were secured by:

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Buildings (Note b) 9,239 8,651 8,063 7,916 Investment properties (Note d) 61,800 57,600 54,900 54,900

71,039 66,251 62,963 62,816

The borrowings are repayable as follows:

As at As at December 31, March 31, 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000

Within 1 year 120,000 120,000 120,000 120,000

The weighted average effective interest rate for the years ended December 31, 2018, 2019 and 2020 and the three months ended March 31, 2021 were 4.85%, 4.85%, 4.52% and 4.53%, respectively.

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40 BENEFITS AND INTERESTS OF DIRECTORS AND SUPERVISORS

(a) Directors’ and supervisors’ emoluments

Remuneration of every director and supervisor during the Track Record Period was as follows:

Employer’s Allowances contribution Salaries and and benefits to retirement Fees wages in kind benefit plan Total RMB’000 RMB’000 RMB’000 RMB’000 RMB’000

Year ended December 31, 2018 Chairman, executive director and general manager: Mr. Chen Yaozhong – 1,191 – 78 1,269 Executive directors: Mr. Liang Zhijun – 980 – 78 1,058 Mr. Lv Yuhua – 980 – 78 1,058 Non-executive directors: Mr. Yin Shanfeng ––––– Mr. Ma Xingwen ––––– Mr.NingZhu(i) ––––– Independent non-executive directors: Mr. Huang Yanzhong 50 – – – 50 Mr. Cao Hu 50 – – – 50 Mr. Xie Jiajin ––––– Supervisors: Mr. Zhang Zhi – 589 – 78 667 Mr. Liang Xiaobin –––––

100 3,740 – 312 4,152

Year ended December 31, 2019 Chairman, executive director and general manager: Mr. Chen Yaozhong – 1,561 1,086 69 2,716 Executive directors: Mr. Liang Zhijun – 1,289 905 69 2,263 Mr. Lv Yuhua – 1,176 830 69 2,075 Non-executive directors: Mr. Yin Shanfeng (ii) 130 – – – 130 Mr. Ma Xingwen 130 – – – 130 Mr. Ning Zhu 130 – – – 130 Independent non-executive directors: Mr. Huang Yanzhong 130 – – – 130 Mr. Cao Hu 130 – – – 130 Mr. Wu Yajun (iii) ––––– Mr. Xie Jiajin ––––– Supervisors: Mr. Zhang Zhi – 655 483 69 1,207 Mr. Liang Xiaobin ––––– Mr. Yu Songdong (iv) – 513 193 66 772 Mr. Wang Junling (v) – 397 154 66 617

650 5,591 3,651 408 10,300

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Employer’s Allowances contribution Salaries and and benefits to retirement Fees wages in kind benefit plan Total RMB’000 RMB’000 RMB’000 RMB’000 RMB’000

Year ended December 31, 2020 Chairman, executive director and general manager: Mr. Chen Yaozhong – 1,568 1,086 62 2,716 Executive directors: Mr. Liang Zhijun – 1,297 905 62 2,264 Mr. Lv Yuhua – 1,297 830 62 2,189 Mr. Yin Shanfeng (ii) 131 77 – 6 214 Non-executive directors: Mr. Ma Xingwen 143 – – – 143 Mr. Ning Zhu 143 – – – 143 Independent non-executive directors: Mr. Wu Yajun 143 – – – 143 Mr. Huang Yanzhong 143 – – – 143 Mr. Cao Hu 143 – – – 143 Mr. Xie Jiajin ––––– Supervisors: Mr. Zhang Zhi – 663 483 61 1,207 Mr. Liang Xiaobin ––––– Mr. Yu Songdong – 576 193 61 830 Mr. Wang Junling – 381 154 58 593

846 5,859 3,651 372 10,728

Three months ended March 31, 2020 Chairman, executive director and general manager: Mr. Chen Yaozhong – 395 – 13 408 Executive directors: Mr. Liang Zhijun – 327 – 13 340 Mr. Lv Yuhua – 327 – 13 340 Non-executive directors: Mr. Yin Shanfeng 36 – – – 36 Mr. Ma Xingwen 36 – – – 36 Mr. Ning Zhu 36 – – – 36 Independent non-executive directors: Mr. Wu Yajun 36 – – – 36 Mr. Huang Yanzhong 36 – – – 36 Mr. Cao Hu 36 – – – 36 Mr. Xie Jiajin ––––– Supervisors: Mr. Zhang Zhi – 168 – 13 181 Mr. Liang Xiaobin ––––– Mr. Yu Songdong – 146 – 13 159 Mr. Wang Junling – 98 – 12 110

216 1,461 – 77 1,754

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Employer’s Allowances contribution Salaries and and benefits to retirement Fees wages in kind benefit plan Total RMB’000 RMB’000 RMB’000 RMB’000 RMB’000

Three months ended March 31, 2021 Chairman, executive director and general manager: Mr. Chen Yaozhong – 388 – 20 408 Executive directors: Mr. Liang Zhijun – 320 – 20 340 Mr. Lv Yuhua – 320 – 20 340 Mr. Yin Shanfeng – 230 – 20 250 Non-executive directors: Mr. Ma Xingwen 36 – – – 36 Mr. Ning Zhu 36 – – – 36 Independent non-executive directors: Mr. Wu Yajun 36 – – – 36 Mr. Huang Yanzhong 36 – – – 36 Mr. Cao Hu 36 – – – 36 Mr. Xie Jiajin ––––– Supervisors: Mr. Zhang Zhi – 162 – 19 181 Mr. Xin Zhiqiang (vi) ––––– Mr. Liang Xiaobin ––––– Mr. Yu Songdong – 140 – 19 159 Mr. Wang Junling – 91 – 19 110

180 1,651 – 137 1,968

(i) Mr. Ning Zhu was appointed as a non-executive director on July 8, 2018.

(ii) Mr. Yin Shanfeng was resigned as non-executive director and appointed as executive director on December 1, 2020.

(iii) Mr. Wu Yajun was appointed as an independent non-executive director on December 8, 2019.

(iv) Mr. Yu Songdong was appointed as a supervisor on April 25, 2019.

(v) Mr. Wang Junling was appointed as a supervisor on April 25, 2019.

(vi) Mr. Xin Zhiqiang was appointed as a supervisor on March 20, 2021.

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(b) Directors’ retirement and termination benefits

No retirement or termination benefits have been paid to the Company’s directors for the years ended December 31, 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021.

No consideration was provided to third parties for making available directors’ services during the years ended December 31, 2018, 2019 and 2020 and the three months ended March 31, 2020 and 2021.

(d) Information about loans, quasi-loans or other dealings in favor of directors, controlled bodies corporate by and connected entities with such directors

No loans, quasi-loans or other dealings were entered into by the Company in favor of directors, controlled bodies corporate by and connected entities with such directors during the years ended December 31, 2018, 2019 and 2020 and three months ended March 31, 2020 and 2021.

(e) Directors’ material interests in transactions, arrangements or contracts

Save as disclosed in Note 36, no significant transactions, arrangements and contracts in relation to the Group’s business to which the Group was a party and in which a director of the Company had a material interest, whether directly or indirectly, subsisted at the end of the years/periods or at any time during the years ended December 31, 2018, 2019 and 2020 and three months ended March 31, 2020 and 2021.

41 CONTINGENCIES

On March 4, 2018, the property owners’ association (the “Plaintiffs”) of a residential property under the Group’s management from November 2009 to January 2017 brought an action against the Group and two former chairmen of the property owners’ association (the “Individual Defendants”) in People’s Court of Futian District Court (深圳市福田區人民法院), requesting that the Company (i) settle outstanding contribution to the residential property’s special maintenance fund of RMB8.5 million and relevant interests of RMB2.0 million; (ii) pay approximately RMB21.5 million to the owners’ association; (iii) bear the litigation costs incurred in the lawsuit; and (iv) turn over the relevant management and financial records and documents from 2009 to 2017. Futian District Court issued its judgement on December 24, 2019 and dismissed all claims made by the Plaintiffs. The Plaintiffs later appealed the decision to the Intermediate People’s Court of Shenzhen (深圳市中級人民法院).

On February 23, 2021, the Intermediate People’s Court of Shenzhen vacated the original judgement and remanded the case to Futian District Court for retrial. As of the date of this report, this lawsuit remains pending. The directors of the Company, based on the opinion of the Company’s legal counsel, are of the view that a vast majority of the Plaintiffs’ requests will not be supported by the court and it is unlikely that this lawsuit would have a material adverse impact on the Group’s business, financial conditions and results of operations of the Group. Accordingly, no provision has been made in the Historical Financial Information.

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42 SUBSEQUENT EVENTS

(a) Adoption of Employee Stock Ownership Plan 2021

In order to retain talent for achieving the Group’s strategic and operational goals, on April 28, 2021, the Company’s shareholders passed a resolution approving the adoption of a share incentive scheme (the “Share Incentive Scheme”). Pursuant to the Share Incentive Scheme, the Company granted 5,668,834 shares to certain directors and employees of the Group with a total cash consideration of approximately RMB44,104,000. For the purpose of implementing such plan, Shenzhen Xicheng Rui’an Investment Consultation Partnership (Limited Partnership) (深圳市熙城睿安投資咨詢合夥企業（有限合夥）,“Xicheng Rui’an”) was established and the share capital of the Company was increased from RMB81,544,000 to RMB87,212,834 as a result of the additional capital contribution of approximately RMB44,104,000 made by Xicheng Rui’an. The amount of such capital contribution was paid up in cash on April 30, 2021. The difference between the fair value of the above shares granted and the cash consideration paid by Xicheng Rui’an will be recognized as share-based compensation expenses over the vesting period of the Share Incentive Scheme. Upon completion of such increase of share capital, the Company became owned as to approximately 20.70% by Xicheng Ruijia, 18.50% by Xicheng Ruihe, 11.85% by Xicheng Ruifeng, 8.95% by Xicheng Ruiying, 6.5% by Xicheng Rui’an, 18.22% by Centralcon Capital and 15.28% by Shengmei Tongying.

The general partner of Xicheng Rui’an is Mr. Chen Yaozhong, one of the executive directors of the Company, and the limited partners consist of 46 employees of the Company.

(b) Pre-[REDACTED] Investment

On April 29, 2021, Shengmei Tongying and Country Garden Services entered into a share transfer agreement pursuant to which Shengmei Tongying transfered its entire 15.28% shares of the Company to Country Garden Services at a consideration of RMB540,000,000. As of the date of this report, the above share transfer has been completed and the Company has become owned as to approximately 20.70% by Xicheng Ruijia, 18.50% by Xicheng Ruihe, 18.22% by Centralcon Capital, 15.28% by Country Garden Services, 11.85% by Xicheng Ruifeng, 8.95% by Xicheng Ruiying and 6.5% by Xicheng Rui’an.

III. SUBSEQUENT FINANCIAL STATEMENTS

No audited financial statements have been prepared by the Company or any of the companies now comprising the Group in respect of any period subsequent to March 31, 2021 and up to the date of this report. Save as disclosed in Note 32, no dividend or distribution has been declared or made by the Company or any of its subsidiaries in respect of any period subsequent to March 31, 2021.

– I-101 – THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION

The information set out in this Appendix II does not form part of the Accountant’s Report from PricewaterhouseCoopers, Certified Public Accountants, the reporting accountant of the Company, as set out in Appendix I to this document, and is included herein for illustrative purpose only. The unaudited pro forma financial information should be read in conjunction with the section headed “Financial Information” in this document and the Accountant’s Report set out in Appendix I to this document.

A. UNAUDITED PRO FORMA STATEMENT OF ADJUSTED CONSOLIDATED NET TANGIBLE ASSETS

The following unaudited pro forma statement of adjusted consolidated net tangible assets of the Group prepared in accordance with Rule 4.29 of the Listing Rules are set out below for the purpose of illustrating the effect of the [REDACTED] on the audited consolidated net tangible assets attributable to owners of the Company as at March 31, 2021 as if the [REDACTED] had taken place on that date.

The unaudited pro forma adjusted consolidated net tangible assets has been prepared for illustrative purposes only and because of its hypothetical nature, it may not give a true picture of the consolidated net tangible assets of the Group as at March 31, 2021 or at any future dates following the completion of the [REDACTED].

Unaudited pro forma Audited adjusted consolidated consolidated net tangible net tangible assets assets attributable to attributable to owners of the Estimated net owners of the Company as proceeds from Company as Unaudited pro forma at March 31, the at March 31, adjusted consolidated net 2021(1) [REDACTED](2) 2021 tangible assets per Share(3)(4) RMB’000 RMB’000 RMB’000 RMB HK$

Based on an [REDACTED] of HK$[REDACTED] per H Share 649,194 [REDACTED] [REDACTED] [REDACTED] [REDACTED]

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Notes:

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[REDACTED]

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[REDACTED]

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[REDACTED]

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The following is the text of a letter, summary of values and valuation certificates, prepared for the purpose of incorporation in this document received from Jones Lang LaSalle Corporate Appraisal and Advisory Limited, an independent valuer, in connection with its valuation as at 31 March 2021 of the selected property interests held by CHANGCHENG PROPERTY GROUP CO., LTD.

[REDACTED]

The Board of Directors CHANGCHENG PROPERTY GROUP CO., LTD. 40th Floor Dah Sing Financial Centre 248 Queen’s Road East Wanchai, Hong Kong

Dear Sirs,

In accordance with your instructions to value the selected property interests held by CHANGCHENG PROPERTY GROUP CO., LTD. (the “Company”) and its subsidiaries (hereinafter together referred to as the “Group”) in the People’s Republic of China (the “PRC”), we confirm that we have carried out inspections, made relevant enquiries and searches and obtained such further information as we consider necessary for the purpose of providing you with our opinion of the market values of the selected property interests as at 31 March 2021 (the “valuation date”).

The selected property interests forms part of property activities that each property has a carrying amount of 1% or more of the Group’s total assets and therefore the valuation report of these property interests is required to be included in this document.

The property interests not valued that form part of property activities have carrying amount below 1% of the Group’s total assets and total carrying amount of property interests not valued that form part of property activities is less than 10% of the Group’s total assets as at the valuation date. No single property interest that forms part of non-property activities had a carrying amount of 15% or more of total assets of the Group.

Our valuation is carried out on a market value basis. Market value is defined as “the estimated amount for which an asset or liability should exchange on the valuation date between a willing buyer and a willing seller in an arm’s-length transaction after proper marketing and where the parties had each acted knowledgeably, prudently, and without compulsion”.

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We have valued the property interests by the income approach by taking into account the rental income of the properties derived from the existing leases and/or achievable in the existing market with due allowance for the reversionary income potential of the leases, which have been then capitalized to determine the market value at an appropriate capitalization rate. Where appropriate, reference has also been made to the comparable sales transactions as available in the relevant market.

Our valuation has been made on the assumption that the seller sells the property interests in the market without the benefit of a deferred term contract, leaseback, joint venture, management agreement or any similar arrangement, which could serve to affect the values of the property interests.

No allowance has been made in our report for any charge, mortgage or amount owing on any of the property interests valued nor for any expense or taxation which may be incurred in effecting a sale. Unless otherwise stated, it is assumed that the properties are free from encumbrances, restrictions and outgoings of an onerous nature, which could affect their values.

In valuing the property interests, we have complied with all requirements contained in Chapter 5 and Practice Note 12 of the Rules Governing the Listing of Securities issued by The Stock Exchange of Hong Kong Limited; the RICS Valuation—Global Standards published by the Royal Institution of Chartered Surveyors; the HKIS Valuation Standards published by the Hong Kong Institute of Surveyors, and the International Valuation Standards published by the International Valuation Standards Council.

We have relied to a very considerable extent on the information given by the Group and have accepted advice given to us on such matters as tenure, planning approvals, statutory notices, easements, particulars of occupancy, lettings, and all other relevant matters.

We have been shown copies of title documents including State-owned Land Use Rights Certificate and Real Estate Title Certificates and other official plans relating to the property interests and have made relevant enquiries. Where possible, we have examined the original documents to verify the existing title to the property interests in the PRC and any material encumbrance that might be attached to the property interests or any tenancy amendment. We have relied considerably on the advice given by the Company’s PRC Legal Advisor – Global Law Office, concerning the validity of the property interests in the PRC.

We have not carried out detailed measurements to verify the correctness of the areas in respect of the properties but have assumed that the areas shown on the title documents and official site plans handed to us are correct. All documents and contracts have been used as reference only and all dimensions, measurements and areas are approximations. No on-site measurement has been taken.

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We have inspected the exterior and, where possible, the interior of the properties. However, we have not carried out investigation to determine the suitability of the ground conditions and services for any development thereon. Our valuation has been prepared on the assumption that these aspects are satisfactory. Moreover, no structural survey has been made, but in the course of our inspection, we did not note any serious defect. We are not, however, able to report whether the properties are free of rot, infestation or any other structural defect. No tests were carried out on any of the services.

Inspection of the properties was carried out in May 2021 by about two technical staffs including Mr. Jimmy Gu and Ms. Mia Lei. They have more than 3 to 8 years’ experience in the valuation of properties in the PRC.

We have had no reason to doubt the truth and accuracy of the information provided to us by the Group. We have also sought confirmation from the Group that no material factors have been omitted from the information supplied. We consider that we have been provided with sufficient information to arrive an informed view, and we have no reason to suspect that any material information has been withheld.

Unless otherwise stated, all monetary figures stated in this report are in Renminbi (RMB).

We are instructed to provide our opinion of values as per the valuation date only. It is based on economic, market and other conditions as they exist on, and information made available to us as of, the valuation date and we assume no obligation to update or otherwise revise these materials for events in the time since then. In particular, the outbreak of the Novel Coronavirus (COVID-19) since declared Global Pandemic on 11 March 2020 has caused much disruption to economic activities around the world. As of the report date, China’s economy has recovered and most business activities have been back to normal. We also note that market activity and market sentiment in these particular market sectors remain stable. However, we remain cautious due to uncertainty for the pace of global economic recovery in the midst of the outbreak which may have future impact on the real estate market. Therefore, we recommend that you keep the valuation of these properties under frequent review.

Our summary of values and valuation certificates are attached below for your attention.

Yours faithfully, For and on behalf of Jones Lang LaSalle Corporate Appraisal and Advisory Limited Eddie T. W. Yiu MRICS MHKIS RPS (GP) Senior Director

Notes: Eddie T. W. Yiu is a Chartered Surveyor who has 27 years’ experience in the valuation of properties in Hong Kong and the PRC as well as relevant experience in the Asia-Pacific region.

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SUMMARY OF VALUES

Properties held for investment by the Group in the PRC

Market value Market value in existing attributable to state as Interest the Group as at 31 March attributable to at 31 March No. Property 2021 the Group 2021 RMB RMB

1. 523 retail units and 240,100,000 100% 240,100,000 339 underground car parking spaces of Beijiao Commercial Square located at the northeastern side of Renchang Road and the northwestern side of Chengde Road Shunde District Foshan City Guangdong Province The PRC (北滘商業廣場523個零售商業單元及 339個地下車位)

2. 14 office units of 54,900,000 100% 54,900,000 Tower A of Galaxy Century Building No. 3069 Caitian Road Futian District Shenzhen City Guangdong Province The PRC (星河世紀大廈A座14個辦公單元)

Total: 295,000,000 295,000,000

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VALUATION CERTIFICATE

Properties held for investment by the Group in the PRC

Market value in Particulars of existing state as No. Property Description and tenure occupancy at 31 March 2021 RMB

1. 523 retail units and Beijiao Commercial Square is As at the 240,100,000 339 underground located at the northeastern side of valuation date, car parking spaces of Renchang Road and the portions of the Beijiao Commercial northwestern side of Chengde property were Square Road, Shunde District, Foshan rented to located at the City. It is well-served by public various third northeastern side of transportation with about 20 parties for Renchang Road and minutes’ driving distance to commercial the northwestern side Beijiao Railway Station and about purpose and of Chengde Road 50 minutes’ driving distance to the remaining Shunde District Foshan Shadi Airport. The portion of the Foshan City locality of the property is a property was Guangdong Province well-developed residential area vacant. The PRC served with public facilities and (北滘商業廣場523個 transportation. 零售商業單元及339個地下車位) Beijiao Commercial Square occupies a parcel of land with a site area of approximately 21,299.11 sq.m., which has been developed into a commercial development in one phase and was completed in 2012.

The property has a total gross floor area of approximately 30,564.19 sq.m. The details are set out as follows:

Usage Gross Floor Area (sq.m.)

Retail 18,814.81 339 underground 11,749.38 car parking spaces

Total: 30,564.19

The land use rights of the property have been granted for a term expiring on 29 November 2048 for commercial use.

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Notes:

1. Pursuant to a State-owned Land Use Rights Certificate – Fo Fu (Shun) Guo Yong (2009) Di No. 0301448, the land use rights of a parcel of land (including the land use rights of the property) with a site area of approximately 21,299.11 sq.m. have been granted to Foshan Shunde Chengjiruishang Real Estate Co., Ltd. (佛山市順德區城基睿商房地產有限公司, “Chengji Ruishang”, a wholly-owned subsidiary of the Company) for a term expiring on 29 November 2048 for commercial use.

2. Pursuant to a Construction Work Planning Permit – Jian Zi Di No. 440606200917834 in favour of Chengji Ruishang, Beijiao Commercial Square (including the property) with a gross floor area of approximately 60,638 sq.m. has been approved for construction.

3. Pursuant to a Construction Work Commencement Permit – No. 440606201004290101 in favour of Chengji Ruishang, permissions by the relevant local authority were given to commence the construction of Beijiao Commercial Square (including the property) with a gross floor area of approximately 60,638 sq.m.

4. Pursuant to a Construction Work Completion and Inspection Table in favour of Chengji Ruishang, the construction of Beijiao Commercial Square (including the property) with a gross floor area of approximately 61,449.15 sq.m. has been completed and passed the inspection acceptance.

5. As advised by the Company, the underground car parking spaces of the property comprises 270 air defense car parking spaces and 69 non-air defense car parking spaces.

6. Pursuant to 503 Real Estate Title Certificates, 503 retail units of the property with a total gross floor area of approximately 17,720.34 sq.m. are owned by Chengji Ruishang. The relevant land use rights of such units have been granted to Chengji Ruishang for a term expiring on 29 November 2048 for commercial use.

7. Pursuant to 19 Real Estate Title Certificates, 19 retail units of the property with a total gross floor area of approximately 1,011.76 sq.m. are owned by the Company. The relevant land use rights of such units have been granted to the Company for a term expiring on 29 November 2048 for commercial use.

8. For the retail unit – No. 21004 of the property with a gross floor area of approximately 82.71 sq.m. and 339 underground car parking spaces of the property with a total gross floor area of approximately 11,749.38 sq.m., we have not been provided with any Real Estate Title Certificates.

9. Pursuant to 2 Foshan City Shunde District Commercial Housing Title Certificates (佛山市順德區商品房權屬證明書) – Shun Yu Xu Zi Nos. 20110265 and 20120073, 1,073 retail units and the underground parking spaces of Beijiao Commercial Square (including 69 non-air defense car parking spaces of the property mentioned in note 5 and the retail unit – No. 21004 of the property mentioned in note 8) with a total gross floor area of approximately 25,531.43 sq.m. are owned by Chengji Ruishang. The relevant land use rights of such properties have been granted to Chengji Ruishang for a term expiring on 29 November 2048.

10. As advised by the Company, Foshan Shunde Chengjiruishang Real Estate Co., Ltd. is the former name of Foshan Shunde Chengjiruishang Commercial Operation Management Co., Ltd. (佛山市順德區城基睿商商業運營管理有限公司, “Foshan Chengjiruishang”).

11. Pursuant to various Tenancy Agreements, various retail units of the property with a total gross floor area of approximately 18,675.11 sq.m. were leased to various independent third parties for various terms with the expiry dates between 14 May 2021 and 27 April 2027. The total monthly rent as at the valuation date was approximately RMB483,000, exclusive of management fees, water and electricity charges.

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12. Our valuation has been made on the following basis and analysis:

a. For the property, we have considered the actual rents in the existing tenancy agreements (if any) and also compared with similar developments which are located in the similar areas as the retail units of the subject property, for the calculation of market rent in considering (1) the reversionary rental income after the expiry of the existing leases for occupied area, and (2) the rental income of vacant area;

b. The unit rent of these comparable retail units/car parking spaces ranges from RMB1.0 to RMB8.0 per sq.m. per day for retail units on the first floor and RMB7.5 to RMB8.0 per lot per day for car parking spaces; and

c. Based on our research on retail/car parking spaces markets in the surrounding area of the property, the stabilized market yield ranged from 5.0% to 5.5% for retail unit and 3.0% to 3.5% for car parking spaces.

13. We have been provided with a legal opinion regarding the property interest by the Company’s PRC Legal Advisor, which contains, inter alia, the following:

a. Foshan Chengjiruishang legally owns the building ownership rights of the properties mentioned in note 6. Such rights are protected by PRC laws and there are no disputes;

b. According to the Company’s confirmation, 487 retail units of the property are subject to mortgages;

c. In accordance with relevant PRC laws and regulations, expect for the other rights mentioned above, Foshan Chengjiruishang is entitled to occupy, use, lease, transfer, mortgage or otherwise dispose of such properties mentioned in note 6 according to the stated usage on relevant Real Estate Title Certificates;

d. The Company legally owns the building ownership rights of the properties mentioned in note 7. Such rights are protected by PRC laws and there are no disputes;

e. In accordance with relevant PRC laws and regulations, the Company is entitled to occupy, use, lease, transfer, mortgage or otherwise dispose of such properties mentioned in note 7 according to the stated usage on relevant Real Estate Title Certificates;

f. For 69 non-air defense car parking spaces of the property mentioned in note 5 and the retail unit – No. 21004 of the property mentioned in note 8, Foshan Chengjiruishang has obtained the Foshan City Shunde District Commercial Housing Title Certificates but has not obtained the Real Estate Title Certificates. In view of that Foshan Chengjiruishang has obtained relevant construction permits and has registered the real estate title of such properties, Foshan Chengjiruishang is entitled to occupy, use, lease and transfer such properties in accordance with laws;

g. There is no substantial legal impediment for Foshan Chengjiruishang applying for the Real Estate Title Certificates of 69 non-air defense car parking spaces of the property mentioned in note 5 and the retail unit – No. 21004 of the property mentioned in note 8; and

h. As the investor and developer of 270 air defense car parking spaces of the property mentioned in note 5, Foshan Chengjiruishang has the right of earning income and is entitled to occupy and use such air defense car parking spaces and transfer the right of earning income of such air defense car parking spaces in accordance with laws.

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VALUATION CERTIFICATE

Market value in Particulars of existing state as No. Property Description and tenure occupancy at 31 March 2021 RMB

2. 14 office units of Galaxy Century Building is As at the 54,900,000 Tower A of Galaxy located at the southern side of valuation date, Century Building Shennan Avenue and the western the property No. 3069 Caitian side of Caitian Road, Futian was rented to a Road District, Shenzhen City. It is third party for Futian District well-served by public office purpose. Shenzhen City transportation with about 10 Guangdong Province minutes’ driving distance to The PRC Futian Railway Station and about (星河世紀大廈A座 40 minutes’ driving distance to 14個辦公單元) Shenzhen Bao’an International Airport. The locality of the property is a well-developed residential and commercial area served with public facilities and transportation.

Galaxy Century Building occupies a parcel of land with a site area of approximately 11,700.65 sq.m., which has been developed into a residential and commercial development and was completed in 2006.

The property comprises 14 office units on Level 34 of Tower A of Galaxy Century Building. The property has a total gross floor area of approximately 1,251.04 sq.m.

The land use rights of the property have been granted for a term of 70 years expiring on 12 September 2074 for commercial, office, residential and ancillary uses.

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Notes:

1. Pursuant to 14 Real Estate Title Certificates, the property with a total gross floor area of approximately 1,251.04 sq.m. is owned by the Company. The relevant land use rights of the property have been granted to the Company for a term of 70 years expiring on 12 September 2074 for commercial, office, residential and ancillary uses.

2. Pursuant to a Tenancy Agreement and relevant supplementary agreements, the property with a total gross floor area of approximately 1,251.04 sq.m. was leased to an independent third party for a term of 6 years commencing from 24 February 2018 and expiring on 23 February 2024 for office purpose. The total monthly rent as at the valuation date was approximately RMB169,000, exclusive of management fees, water and electricity charges.

3. Our valuation has been made on the following basis and analysis:

a. For the property, we have considered the actual rents in the existing tenancy agreements (if any) and also compared with similar developments which are located in the similar areas as the office units of the subject property, for the calculation of market rent in considering (1) the reversionary rental income after the expiry of the existing leases for occupied area, and (2) the rental income of vacant area;

b. The unit rent of these comparable office units ranges from RMB4.0 to RMB6.0 per sq.m. per day; and

c. Based on our research on office markets in the surrounding area of the property, the stabilized market yield ranged from 3.75% to 4.25%.

4. We have been provided with a legal opinion regarding the property interest by the Company’s PRC Legal Advisor, which contains, inter alia, the following:

a. The Company legally owns the building ownership rights of the property. Such rights are protected by PRC laws and there are no disputes;

b. According to the Company’s confirmation, the property is subject to a mortgage; and

c. In accordance with relevant PRC laws and regulations, expect for the other rights mentioned above, the Company is entitled to occupy, use, lease, transfer, mortgage or otherwise dispose of the property according to the stated usage on relevant Real Estate Title Certificates.

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TAXATION OF SECURITY HOLDERS

The following summary of certain Hong Kong and PRC tax consequences of the purchase, ownership and disposition of the H Shares is based upon the laws, regulations, rules and decisions now in effect, all of which are subject to change (possibly with retroactive effect). The summary does not purport to be a comprehensive description of all the tax considerations that may be relevant to a decision to purchase, own or dispose of the H Shares and does not purport to apply to all categories of prospective investors, some of whom may be subject to special rules, which does not and shall not be deemed as consisting a legal or taxation suggestion. Prospective investors should consult their own tax advisors concerning the application of Hong Kong and PRC tax laws to their particular situation as well as any consequences of the purchase, ownership and disposition of the shares arising under the laws of any other taxing jurisdiction.

The taxation of the Company and that of the Shareholders is described below. Where Hong Kong and PRC tax laws are discussed. These are merely an outline implications of such laws. It should not be assumed that the relevant tax authorities or the PRC or Hong Kong courts will accept or agree with the explanations or conclusions that are set out below. Investors should note that the following statements are based on advice received by the Company regarding taxation laws, regulations and practice in force as at the date of this document, which may be subject to change.

OVERVIEW OF TAX IMPLICATIONS OF PRC

Enterprise Income Tax (the “EIT”)

According to the EIT Law of the PRC《中華人民共和國企業所得稅法》 ( ) (Order No. 63 of the President), which was promulgated by the SCNPC on March 16, 2007 and then amended respectively on February 24, 2017 and December 29, 2018, and came into effect on December 29, 2018, and the EIT Implementation Rules of the PRC《中華人民共和國企 ( 業所得稅法實施條例》) (Order No. 512 of the State Council), which was promulgated by the State Council on December 6, 2007 and became effective from January 1, 2008 and was amended on April 23, 2019, enterprises are classified as either resident enterprises or non-resident enterprises. Resident enterprises refer to the enterprises established according to laws of the PRC in the PRC or established under the laws of foreign countries (regions) with the actual management body located in the PRC. Non-resident enterprises refer to the enterprises established under the laws of foreign countries (regions) with the actual management body located outside the PRC, which have establishment or place of business in the PRC, or have no establishment or place of business in the PRC but have incomes originating from the PRC.

The income tax rate for resident enterprises, including both domestic and foreign-invested enterprises shall typically be 25% commencing from January 1, 2008. A non-resident enterprise that does not have an establishment or place of business in the PRC, or has an establishment or place of business in the PRC but the income of which has no actual relationship with such establishment or place of business, shall pay enterprise income tax on its income deriving from inside the PRC at the reduced rate of enterprise income tax of 10%.

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Value-added Tax

According to the Provisional Regulations on Value-added Tax of the PRC《中華人民 ( 共和國增值稅暫行條例》) (Order No. 134 of the State Council), which was promulgated by the State Council on December 13, 1993, came into effect on January 1, 1994, and was amended on November 5, 2008, February 6, 2016 and November 19, 2017, and the Detailed Rules for the Implementation of the Provisional Regulations of the PRC on Value-Added Tax《中華人民共和國增值稅暫行條例實施細則》 ( ) (No. 65 Order of the Ministry of Finance), which was issued on December 25, 1993 by the Ministry of Finance, and became effective on the same day and revised on December 15, 2008 and October 28, 2011 (collectively, the “VAT Law”), the organizations and individuals engaging in sale of goods or processing, repair and assembly services (hereinafter referred to as “labor services”), sale of services, intangible assets, immovables and importation of goods in the PRC shall be taxpayers of Value-added Tax (“VAT”), and the tax rate for taxpayers engaging in sale of services and intangible assets shall be 6% unless otherwise stipulated and for taxpayers selling goods, labor services, or tangible movable property leasing services or importing goods shall be 17% unless otherwise stipulated.

In addition, in accordance with the Notice on Fully Launch of the Pilot Scheme for the Conversion of Business Tax to Value-Added Tax《關於全面推開營業稅改徵增值稅試點 ( 的通知》) (Cai Shui [2016] No. 36) (hereinafter referred to as “Circular 36”), which was issued by the Ministry of Finance and the SAT on March 23, 2016 and came into effect on May 1, 2016, the state started to fully implement the pilot change from business tax to value-added tax on May 1, 2016. All taxpayers of business tax in construction industry, real estate industry, financial industry and living service industry have been included in the scope of the pilot and should pay value-added tax instead of business tax.

According to the Circular of on Adjusting Value-added Tax Rates announced by the Ministry of Finance and the State Administration of Taxation《財務部、稅務總局關於調整 ( 增值稅稅率的通知》) (Cai Shui [2018] No. 32), which was issued on April 4, 2018, from May 1, 2018, where taxpayers engage in a taxable sales activities for the VAT purpose or imports goods, the previous applicable 17% and 11% tax rates are adjusted to be 16% and 10% respectively.

According to the Announcement on Relevant Policies for Deepening Value-Added Tax Reform《關於深化增值稅改革有關政策的公告》 ( ), which was issued by the Ministry of Finance, the SAT and the General Administration of Customs on March 20, 2019 and came into effect on April 1, 2019, for VAT taxable sales or imported goods of a VAT general taxpayer where the VAT rate of 16% applies currently, it shall be adjusted to 13%, the currently applicable VAT rate of 10% shall be adjusted to 9%.

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Taxation on Dividends

Taxation in Relation to Dividend Distribution

Enterprise Investors

In accordance with the EIT Law《中華人民共和國企業所得稅法》 ( ) issued by the NPC on March 16, 2007 and amended on February 24, 2017 and December 29, 2018 and EIT Implementation Rules of the PRC《中華人民共和國企業所得稅法實施條例》 ( ) issued by the State Council on December 6, 2007, came into effect on January 1, 2008 and amended on April 23, 2019 (hereinafter collectively referred to as the “EIT Law”), the rate of enterprise income tax shall be 25%.

A non-resident enterprise is generally subject to a 10% corporate income tax on PRC-sourced income (including dividends received from a PRC resident enterprise), if it does not have an establishment or premise in the PRC or has an establishment or premise in the PRC but its PRC-sourced income has no real connection with such establishment or premise. The aforesaid income tax payable for non-resident enterprises are deducted at source, where the payer of the income is required to withhold the income tax from the amount to be paid to the non-resident enterprise.

The Circular of the STA on Issues Relating to the Withholding and Remitting of Corporate Income Tax by PRC Resident Enterprises on Dividends Distributed to Overseas Non-Resident Enterprise Shareholders of H Shares《國家稅務總局關於中國居民企業向境 ( 外H股非居民企業股東派發股息代扣代繳企業所得稅有關問題的通知》), which was issued and implemented by the STA on November 6, 2008, further clarified that a PRC-resident enterprise must withhold corporate income tax at a rate of 10% on the dividends of 2008 and onwards that it distributes to overseas non-resident enterprise shareholders of H Shares.

Pursuant to the Arrangement between the Mainland of China and the Hong Kong Special Administrative Region on the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income《內地和香港特別行政區關於對所得避免雙 ( 重徵稅和防止偷漏稅的安排》), which was promulgated by the SAT and became effective on December 8, 2006, the 5% withholding tax rate applies to dividends paid by a PRC company to a Hong Kong resident, provided that the recipient is a company that directly holds at least 25% of the capital of the PRC company; the 10% withholding tax rate applies to dividends paid by a PRC company to a Hong Kong resident if the recipient is a company that directly holds less than 25% of the capital of the PRC company.

Pursuant to the Circular of the State Administration of Taxation on Relevant Issues relating to the Implementation of Dividend Clauses in Tax Agreements《國家稅務總局關 ( 於執行稅收協定股息條款有關問題的通知》) promulgated by the SAT and became effective on February 20, 2009, all of the following requirements must be satisfied for a resident enterprise to enjoy the preferential tax rates provided under the tax agreements: (i) such a fiscal resident who obtains dividends should be a company as defined in the tax agreement; (ii) the equity and voting interests in the PRC resident enterprise directly owned by such fiscal resident must reach a specified percentage; and (iii) the equity interests of the PRC resident enterprise directly owned by such fiscal resident, at any time during the 12 months prior to the payment of the dividends, must reach a specified percentage.

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Pursuant to the Administrative Measures for Agreements Treatment for Non-Resident Taxpayers《非居民納稅人享受協定待遇管理辦法》 ( ), which was issued on October 14, 2019 by the SAT, and became effect on January 1, 2020, according to which, if non-resident taxpayers consider they are eligible for treatments under the treaties through self-assessment, they may, at the time of filing tax returns or making withholding tax filings through withholding agents, enjoy the treatments under the treaties, and shall concurrently collect and retain the relevant documents for inspection according to relevant regulations, and accept tax authorities’ post-filing administration.

Individual Investor

Pursuant to the Individual Income Tax Law of the PRC《中華人民共和國個人所得稅 ( 法》), which was most recently amended on August 31, 2018 and the Implementation Provisions of the Individual Income Tax Law of the PRC《中華人民共和國個人所得稅法實 ( 施條例》), which was most recently amended on December 18, 2018 (hereinafter collectively referred to as the “IIT Law”), dividends distributed by PRC enterprises are subject to individual income tax levied at a flat rate of 20%. For a foreign individual who is not a resident of the PRC, the receipt of dividends from an enterprise in the PRC is normally subject to individual income tax of 20% unless specifically exempted by the tax authority of the State Council or reduced by relevant tax treaty.

Pursuant to the Notice of the STA on Issues Concerning Taxation and Administration of Individual Income Tax After the Repeal of the Document Guo Shui Fa [1993] No. 45)《國家稅務總局關於國稅發 ( [1993]045號文件廢止後有關個人所得稅徵管問題的通知》) issued by the STA on June 28, 2011, domestic non-foreign-invested enterprises issuing shares in Hong Kong may, when distributing dividends to overseas resident individuals in the jurisdiction of the tax treaty, normally withhold individual income tax at the rate of 10%. For the individual holders of H Shares receiving dividends who are citizens of countries that have entered into a tax treaty with the PRC with tax rates lower than 10%, the non-foreign-invested enterprise whose shares are listed in Hong Kong may apply on behalf of such holders for enjoying the lower preferential tax treatments, and, upon approval by the tax authorities, the excessive withholding amount will be refunded. For the individual holders of H Shares receiving dividends who are citizens of countries that have entered into a tax treaty with the PRC with tax rates higher than 10% but lower than 20%, the non-foreign-invested enterprise is required to withhold the tax at the agreed rate under the treaties, and no application procedures will be necessary. For the individual holders of H Shares receiving dividends who are citizens of countries without taxation treaties with the PRC or are under other situations, the non-foreign-invested enterprise is required to withhold the tax at a rate of 20%.

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Taxation on Share Transfer

VAT and Local Additional Tax

Pursuant to Circular 36 entities and individuals engaged in the services sale in the PRC are subject to VAT and “engaged in the services sale in the PRC” means that the seller or buyer of the taxable services is located in the PRC. Circular 36 also provides that transfer of financial products, including transfer of the ownership of marketable securities, shall be subject to VAT at 6% on the taxable revenue (which is the balance of sales price upon deduction of purchase price), for a general or a foreign VAT taxpayer. However, individuals who transfer financial products are exempt from VAT, which is also provided in the Notice of Ministry of Finance and STA on Several Tax Exemption Policies for Business Tax on Sale and Purchase of Financial Commodities by Individuals《財政 ( 部、國家稅務總局關於個人金融商品買賣等營業稅若幹免稅政策的通知》) effective on January 1, 2009.

According to these regulations, if the holder is a non-resident individual, the PRC VAT is exempted from the sale or disposal of H shares. At the same time, VAT payers are also required to pay urban maintenance and construction tax, education surtax and local education surcharge (hereinafter collectively referred to as “Local Additional Tax”), which shall be usually subject to 12% of the value-added tax, business tax and consumption tax actually paid (if any).

Income tax

Enterprise Investors

In accordance with the EIT Law, a non-resident enterprise is generally subject to corporate income tax at the rate of a 10% on PRC-sourced income, including gains derived from the disposal of equity interests in a PRC resident enterprise, if it does not have an establishment or premise in the PRC or has an establishment or premise in the PRC but its PRC-sourced income has no real connection with such establishment or premise. Such income tax payable for non-resident enterprises are deducted at source, where the payer of the income is required to withhold the income tax from the amount to be paid to the non-resident enterprise. Such tax may be reduced or exempted pursuant to relevant tax treaties or agreements on avoidance of double taxation.

Individual Investors

According to the IIT Law, gains on the transfer of equity interests in the PRC resident enterprises are subject to individual income tax at a rate of 20%. Pursuant to the Circular on Declaring that Individual Income Tax Continues to be Exempted over Income of Individuals from the Transfer of Shares《財政部、國家稅務總局關於個人轉讓股票所得 ( 繼續暫免徵收個人所得稅的通知》) issued by the STA on March 30, 1998, from January 1, 1997, income of individuals from transfer of the shares of listed enterprises continues to be exempted from individual income tax. The STA has not expressly stated whether it will continue to exempt tax on income of individuals from transfer of the shares of listed enterprises in the latest amended Individual Income Tax Law.

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However, on December 31, 2009, the Ministry of Finance, STA and CSRC jointly issued the Circular on Related Issues on Levying Individual Income Tax over the Income Received by Individuals from the Transfer of Listed Shares Subject to Sales Limitation (《財政部、國家稅務總局、證監會關於個人轉讓上市公司限售股所得徵收個人所得稅有關問題的通知》), which came into effect on January 1, 2010, which states that individuals’ income from the transfer of listed shares obtained from the public offering of listed companies and transfer market on the Shanghai Stock Exchange and the Shenzhen Stock Exchange shall continue to be exempted from individual income tax, except for the relevant shares which are subject to sales restriction (as defined in the Supplementary Notice on Issues Concerning the Levy of Individual Income Tax on Individuals’ Income from the Transfer of Restricted Stocks of Listed Companies《財政部、國家稅務總局、證監 ( 會關於個人轉讓上市公司限售股所得徵收個人所得稅有關問題的補充通知》) jointly issued and implemented by such departments on November 10, 2010). As of the Latest Practicable Date, no aforesaid provisions have expressly provided that individual income tax shall be levied from non-Chinese resident individuals on the transfer of shares in the PRC resident enterprises listed on overseas stock exchanges.

Stamp Duty

In accordance with the Provisional Regulations of the PRC on Stamp Duty《中華人 ( 民共和國印花稅暫行條例》), which was issued by the State Council on August 6, 1988, came into effect on October 1, 1988, and was amended on January 8, 2011 and the Implementation Provisions of Provisional Regulations of the PRC on Stamp Duty《中華人 ( 民共和國印花稅暫行條例施行細則》), which was promulgated by the MOF on September 29, 1988 and came into effect on October 1, 1988 and revised by Notice on Revision of the Administrative Measures on Payment of Stamp Duties on a Regular and Consolidated Basis (財政部、國家稅務總局關於改變印花稅按期匯總繳納管理辦法的通知) which was issued by MOF and SAT on November 5, 2004, PRC stamp duty only applies to specific taxable document executed or received within the PRC, having legally binding force in the PRC and protected under the PRC laws.

OVERVIEW OF TAX IMPLICATIONS OF HONG KONG

Hong Kong Taxation of the Company

Profits Tax

The Company will be subject to Hong Kong profits tax in respect of profits arising in or derived from Hong Kong at the current rate of 16.5% unless such profits are chargeable under the half-rate of 8.25% that may apply for the first HK$2 million of assessable profits for years of assessment beginning on or after April 1, 2018. Dividend income derived by the Company from its subsidiaries will be excluded from Hong Kong profits tax.

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Hong Kong Taxation of Shareholders

Tax on Dividends

No tax is payable in Hong Kong in respect of dividends paid by the Company.

Profits Tax

Hong Kong profits tax will not be payable by any Shareholders (other than Shareholders carrying on a trade, profession or business in Hong Kong and holding the H Shares for trading purposes) on any capital gains made on the sale or other disposal of the Shares. Trading gains from the sale of H Shares by persons carrying on a trade, profession or business in Hong Kong where such gains are derived from or arise in Hong Kong from such trade, profession or business will be chargeable to Hong Kong income tax rates of 16.5% on corporations and 15.0% on individuals, unless such gains are chargeable under the respective half-rates of 8.25% and 7.5% that may apply for the first HK$2 million of assessable profits for years of assessment beginning on or after April 1, 2018. Gains from sales of H Shares effected on the Stock Exchange will be considered by the Hong Kong Inland Revenue Department to be derived from or arise in Hong Kong. Shareholders should take advice from their own professional advisors as to their particular tax position.

Stamp Duty

Hong Kong stamp duty will be charged on the sale and purchase of Shares at the current rate of 0.2% of the consideration for, or (if greater) the value of, the Shares being sold or purchased, whether or not the sale or purchase is on or off the Stock Exchange. The Shareholder selling the Shares and the purchaser will each be liable for one-half of the amount of Hong Kong stamp duty payable upon such transfer. In addition, a fixed duty of HK$5 is currently payable on any instrument of transfer of Shares.

Estate Duty

Hong Kong estate duty was abolished effective from February 11, 2006. No Hong Kong estate duty is payable by Shareholders in relation to the Shares owned by them upon death.

LAWS AND REGULATIONS RELATING TO FOREIGN EXCHANGE CONTROL

According to Regulations on Foreign Exchange Administration of the PRC《中華人 ( 民共和國外匯管理條例》) (Order No. 193 of the State Council) (the “Foreign Exchange Administration Regulations”), which was promulgated by the State Council on January 29, 1996 and came into effect since April 1, 1996 and was amended on January 14, 1997 and August 5, 2008, RMB is generally freely convertible for payments of current account items, such as trade and service-related foreign exchange transactions and dividend payments, but not freely convertible for capital account items, such as direct investment, loan or investment in securities outside the PRC, unless the prior approval by the SAFE or its local counterparts is obtained.

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Pursuant to the Circular of the State Administration of Foreign Exchange on Reforming the Management Approach Regarding the Settlement of Foreign Exchange Capital of Foreign-invested Enterprises (Huifa [2015] No. 19)《國家外匯管理局關於改革外 ( 商投資企業外匯資本金結匯管理方式的通知》（匯發[2015]19號）,“Circular 19”), which was promulgated by the State Administration of Foreign Exchange on March 30, 2015 and became effective on June 1, 2015, foreign-invested enterprises conduct the willingness settlement of foreign exchange capital. The willingness settlement of foreign exchange capital of foreign-invested enterprises means the settlement of foreign exchange capital in the capital accounts of foreign-invested enterprises that have been subject to the confirmation of cash capital contribution at foreign exchange authorities (or the entry registration of cash contribution at banks) may be handled at banks based on the enterprises’ actual requirements for business operation. The proportion of willingness settlement of foreign exchange capital by foreign-invested enterprises is temporarily determined as 100%. On June 9, 2016, the State Administration of Foreign Exchange further promulgated the Notice of the State Administration of Foreign Exchange on Reforming and Standardizing the Foreign Exchange Settlement Management Policy of Capital Account (Huifa [2016] No. 16)《國家外匯管理局關於改革和規範資本項目結匯管理 ( 政策的通知》（匯發[2016]16號）,“Circular 16”), which amended certain provisions of the Circular 19. According to the Circular 16, the settlement of foreign exchange receipts under the capital account (including but not limited to foreign exchange capital, external debts, etc.) shall be conducted in the banks as actually needed for business operation. The flow and use of the RMB capital converted from foreign currency denominated registered capital of a foreign-invested company is regulated such RMB capital may not be used for business beyond its business scope or to provide loans to persons other than affiliates unless permitted under its business scope; unless otherwise expressly provided, it may not directly or indirectly used for investment in securities or other investments and financial management (except risk hidden and principal guaranteed products). Violations of the Circular 19 or the Circular 16 could result in administrative penalties.

Pursuant to the Notice of the State Administration of Foreign Exchange on Further Promoting Cross-border Trade and Investment Facilitation (Huifa [2019] No. 28)《國家外 ( 匯管理局關於進一步促進跨境貿易投資便利化的通知》（匯發[2019]28號）), which was promul gated by the State Administration of Foreign Exchange on October 23, 2019, and taking ef fect on the same day), foreign-invested enterprise engaged in non-investment business ar e permitted to settle foreign exchange capital in RMB and make domestic equity investme nts with such RMB funds according to law under the condition that the current Special A dministrative Measures (Negative List) for Foreign Investment Access are not violated an d the relevant domestic investment projects are true and compliant.

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PRC LEGAL SYSTEM

The PRC legal system is based on the Constitution of the PRC《中華人民共和國憲 ( 法》) (the “Constitution”) and is made up of written laws, administrative regulations, local regulations, separate regulations, autonomous regulations, rules and regulations of departments, rules and regulations of local governments, international treaties of which the PRC government is a signatory, and other regulatory documents. Court verdicts do not constitute binding precedents. However, they may be used as judicial reference and guidance.

According to the Constitution and the Legislation Law of the PRC《中華人民共和國 ( 立法》) (the “Legislation Law”), the NPC and the Standing Committee of the NPC are empowered to exercise the legislative power of the State. The NPC has the power to formulate and amend basic laws governing civil and criminal matters, state organs and other matters. The Standing Committee of the NPC is empowered to formulate and amend laws other than those required to be enacted by the NPC and to supplement and amend any parts of laws enacted by the NPC during the adjournment of the NPC, provided that such supplements and amendments are not in conflict with the basic principles of such laws.

The State Council is the highest organ of the PRC administration and has the power to formulate administrative regulations based on the Constitution and laws.

The people’s congresses of provinces, autonomous regions and municipalities and their respective standing committees may formulate local regulations based on the specific circumstances and actual requirements of their own respective administrative areas, provided that such local regulations do not contravene any provision of the Constitution, laws or administrative regulations.

The ministries and commissions of the State Council, PBOC, the State Audit Administration as well as the other organs endowed with administrative functions directly under the State Council may, in accordance with the laws as well as the administrative regulations, decisions and orders of the State Council and within the limits of their power, formulate rules.

The people’s congresses of larger cities and their respective standing committees may formulate local regulations based on the specific circumstances and actual requirements of such cities, which will become enforceable after being reported to and approved by the standing committees of the people’s congresses of the relevant provinces or autonomous regions but such local regulations shall conform with the Constitution, laws, administrative regulations, and the relevant local regulations of the relevant provinces or autonomous regions. People’s congresses of national autonomous areas have the power to enact autonomous regulations and separate regulations in light of the political, economic and cultural characteristics of the nationality (nationalities) in the areas concerned.

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The people’s governments of the provinces, autonomous regions, and municipalities directly under the central government and the comparatively larger cities may enact rules, in accordance with laws, administrative regulations and the local regulations of their respective provinces, autonomous regions or municipalities.

The Constitution has supreme legal authority and no laws, administrative regulations, local regulations, autonomous regulations or separate regulations may contravene the Constitution. The authority of laws is greater than that of administrative regulations, local regulations and rules. The authority of administrative regulations is greater than that of local regulations and rules. The authority of local regulations is greater than that of the rules of the local governments at or below the corresponding level. The authority of the rules enacted by the people’s governments of the provinces or autonomous regions is greater than that of the rules enacted by the people’s governments of the comparatively larger cities within the administrative areas of the provinces and the autonomous regions.

The NPC has the power to alter or annul any inappropriate laws enacted by its Standing Committee, and to annul any autonomous regulations or separate regulations which have been approved by its Standing Committee but which contravene the Constitution or the Legislation Law. The Standing Committee of the NPC has the power to annul any administrative regulations that contravene the Constitution and laws, to annul any local regulations that contravene the Constitution, laws or administrative regulations, and to annul any autonomous regulations or local regulations which have been approved by the standing committees of the people’s congresses of the relevant provinces, autonomous regions or municipalities directly under the central government, but which contravene the Constitution and the Legislation Law. The State Council has the power to alter or annul any inappropriate ministerial rules and rules of local governments. The people’s congresses of provinces, autonomous regions or municipalities directly under the central government have the power to alter or annul any inappropriate local regulations enacted or approved by their respective standing committees. The people’s governments of provinces and autonomous regions have the power to alter or annul any inappropriate rules enacted by the people’s governments at a lower level.

According to the Constitution and the Legislation Law, the power to interpret laws is vested in the Standing Committee of the NPC. According to the Decision of the Standing Committee of the NPC Regarding the Strengthening of Interpretation of Laws《全國人民 ( 代表大會常務委員會關於加強法律解釋工作的決議》) passed on June 10, 1981, the Supreme People’s Court of the PRC (the “Supreme People’s Court”) has the power to give general interpretation on questions involving the specific application of laws and decrees in court trials. The State Council and its ministries and commissions are also vested with the power to give interpretation of the administrative regulations and department rules which they have promulgated. At the regional level, the power to give interpretations of the local laws and regulations as well as administrative rules is vested in the regional legislative and administrative organs which promulgate such laws, regulations and rules.

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PRC JUDICIAL SYSTEM

Under the Constitution and the PRC Law on the Organization of the People’s Courts《中華人民共和國人民法院組織法》 ( ), the PRC judicial system is made up of the Supreme People’s Court, the local people’s courts, military courts and other special people’s courts.

The local people’s courts are composed of the primary people’s courts, the intermediate people’s courts and the higher people’s courts. The primary people’s courts are organized into civil, criminal, administrative, supervision and enforcement divisions. The intermediate people’s courts are organized into divisions similar to those of the primary people’s courts, and are entitled to organize other courts as needed such as the intellectual property division.

The higher level people’s courts supervise the primary and intermediate people’s courts. The people’s procuratorates also have the right to exercise legal supervision over the civil proceedings of people’s courts of the same level and lower levels. The Supreme People’s Court is the highest judicial body in the PRC. It supervises the judicial administration of the people’s courts at all levels.

The people’s courts apply a two-tier appellate system. A party may appeal against a judgment or order of a local people’s court to the people’s court at the next higher level. Second judgments or orders given at the next higher level are final. First judgments or orders of the Supreme People’s Court are also final. However, if the Supreme People’s Court or a people’s court at a higher level finds an error in a judgment or an order which has been given in any people’s court at a lower level, or the presiding judge of a people’s court finds an error in a judgment which has been given in the court over which he presides, the case may then be retried according to the judicial supervision procedures.

The PRC Civil Procedure Law《中華人民共和國民事訴訟法》 ( ) (the “Civil ProcedureLaw”), which was adopted in 1991 and amended in 2007, 2012 and 2017, sets forth the criteria for instituting a civil action, the jurisdiction of the people’s courts, the procedures to be followed for conducting a civil action and the procedures for enforcement of a civil judgment or order. All parties to a civil action conducted within the PRC must comply with the Civil Procedure Law. Generally, a civil case is initially heard by a local court of the municipality or province in which the defendant resides. The parties to a contract may, by express agreement, select a judicial court where civil actions may be brought, provided that the judicial court is either the plaintiff’s or the defendant’s domicile, the place of execution or implementation of the contract or the place of the object of the action, provided that the provisions of this law regarding the level of jurisdiction and exclusive jurisdiction shall not be violated.

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A foreign national or enterprise generally has the same litigation rights and obligations as a citizen or legal person of the PRC. If a foreign country’s judicial system limits the litigation rights of PRC citizens and enterprises, the PRC courts may apply the same limitations to the citizens and enterprises of that foreign country within the PRC. If any party to a civil action refuses to comply with a judgment or ruling made by a people’s court or an award made by an arbitration panel in the PRC, the other party may apply to the people’s court for the enforcement of the same. There are time limits of two years imposed on the right to apply for such enforcement. If a person fails to satisfy a judgment made by the court within the stipulated time, the court will, upon application by either party, enforce the judgment in accordance with the law.

A party seeking to enforce a judgment or ruling of a people’s court against a party who is not personally or whose property is not within the PRC may apply to a foreign court with jurisdiction over the case for recognition and enforcement of the judgment or ruling. A foreign judgment or ruling may also be recognized and enforced by the people’s court according to PRC enforcement procedures if the PRC has entered into or acceded to an international treaty with the relevant foreign country, which provides for such recognition and enforcement, or if the judgment or ruling satisfies the court’s examination according to the principle of reciprocity, unless the people’s court finds that the recognition or enforcement of such judgment or ruling will result in a violation of the basic legal principles of the PRC, its sovereignty or security or against social and public interest.

THE PRC COMPANY LAW, SPECIAL REGULATIONS AND MANDATORY PROVISIONS

A joint stock limited company which is incorporated in the PRC and seeking a listing on the Stock Exchange is mainly subject to the following three laws and regulations in the PRC:

• The PRC Company Law《中華人民共和國公司法》 ( ) which was promulgated by the Standing Committee of the NPC on December 29, 1993, came into effect on July 1, 1994, revised on December 25, 1999, August 28, 2004, October 27, 2005 and December 28, 2013 respectively and the latest revision of which was implemented on October 26, 2018;

• The Special Regulations of the State Council on Share Offering and Listing Overseas by Joint-Stock Limited Liability Companies《國務院關於股份有限公 ( 司境外募集股份及上市的特別規定》) (the “Special Regulations”) which were promulgated by the State Council on August 4, 1994 pursuant to Articles 85 and 155 of the PRC Company Law in force at that time, and were applicable, to the overseas share subscription and listing of joint stock limited companies;

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• The Mandatory Provisions of Articles of Association of Companies Listing Overseas《到境外上市公司章程必備條款》 ( ) (the “Mandatory Provisions”) which were issued jointly by the former Securities Commission of the State Council and the former State Economic Restructuring Commission on August 27, 1994, stating the mandatory provisions of the articles of association of a joint stock limited company seeking an overseas listing. As such, the Mandatory Provisions are set out in the Articles of Association of the Company, the summary of which is set out in the section entitled “Appendix VI—Summary of the Articles of Association” in this document.

On October 17, 2019, State Council issued the Official Reply of the State Council regarding Adjusting the Application of Provisions to Matters Including the Notice Period of Overseas Listed Companies for Convening Shareholders’ Meetings《國務院關於調整適 ( 用在境外上市公司召開股東大會通知期限等事項規定的批覆》), which is approved that, for those joint stock companies registered in China but listed outside China, the requirements for the notice period for convening a shareholders’ meeting, shareholders ‘proposal right, and the procedures for convening a shareholders’ meeting shall be collectively governed by the relevant provisions of the PRC Company Law, and no longer be governed by the provisions of Article 20 through Article 22 of the Special Regulations of the State Council on the Overseas Offering and Listing of Shares of Joint Stock Companies.

Set out below is a summary of the major provisions of the PRC Company Law, the Special Regulations and the Mandatory Provisions applicable to the Company.

General

A joint stock limited company refers to an enterprise legal person incorporated under the PRC Company Law with its registered capital divided into shares of equal par value. The liability of its shareholders is limited to the amount of shares held by them and the company is liable to its creditors for an amount equal to the total value of its assets.

A joint stock limited company shall conduct its business in accordance with laws and administrative regulations. It may invest in other limited liability companies and joint stock limited companies and its liabilities with respect to such invested companies are limited to the amount invested. Unless otherwise provided by law, the joint stock limited company may not be a contributor that undertakes joint and several liabilities for the debts of the invested companies.

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Incorporation

A joint stock limited company may be incorporated by promotion or public subscription. A joint stock limited company may be incorporated by a minimum of two but not more than 200 promoters, and at least half of the promoters must have residence within the PRC. The promoters must convene an inaugural meeting within 30 days after the issued shares have been fully paid up, and must give notice to all subscribers or make an announcement of the date of the inaugural meeting 15 days before the meeting. The inaugural meeting may be convened only with the presence of promoters or subscribers representing at least half of the shares in the company. At the inaugural meeting, matters including the adoption of articles of association and the election of members of the board of directors and members of the board of supervisors of the company will be dealt with. All resolutions of the meeting require the approval of subscribers with more than half of the voting rights present at the meeting. Within 30 days after the conclusion of the inaugural meeting, the board of directors must apply to the registration authority for registration of the establishment of the joint stock limited company. A company is formally established, and has the status of a legal person, after the business license has been issued by the relevant registration authority. Joint stock limited companies established by the subscription method shall file the approval on the offering of shares issued by the securities administration department of the State Council with the company registration authority for record.

A joint stock limited company’s promoters shall be liable for: (i) the payment of all expenses and debts incurred in the incorporation process jointly and severally if the company cannot be incorporated; (ii) the refund of subscription monies to the subscribers, together with interest, at bank rates for a deposit of the same term jointly and severally if the company cannot be incorporated; and (iii) damages suffered by the company as a result of the default of the promoters in the course of incorporation of the company. According to the Interim Provisional Regulations on the Administration of Share Issuance and Trading《股票發行與交易管理暫行條例》 ( ) promulgated by the State Council on April 22, 1993 (which is only applicable to the issuance and trading of shares in the PRC and their related activities), if a company is established by means of public subscription, the promoters of such company are required to sign on this document to ensure that this document does not contain any misrepresentation, serious misleading statements or material omissions, and assume joint and several responsibility for it.

Share Capital

The promoters of a company can make capital contributions in cash or in kind, which can be valued in currency and transferable according to law such as intellectual property rights or land use rights based on their appraised value. If capital contribution is made other than in cash, valuation and verification of the property contributed must be carried out and converted into shares.

A company may issue registered or bearer share. However, shares issued to promoter(s) or legal person(s) shall be in the form of registered share and shall be registered under the name(s) of such promoter(s) or legal person(s) and shall not be registered under a different name or the name of a representative.

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The Special Regulations and the Mandatory Provisions provide that shares issued to foreign investors and listed overseas shall be issued in registered form and shall be denominated in Renminbi and subscribed for in foreign currency. Under the Special Regulations and the Mandatory Provisions, shares issued to foreign investors and investors from the territories of Hong Kong, the Macau and Taiwan and listed overseas are known as overseas listed foreign invested shares, and those shares issued to investors within the PRC other than the territories specified above are known as Domestic Shares.

A company may offer its shares to the public overseas with approval by the securities administration department of the State Council. Specific provisions shall be specifically formulated by the China Securities Regulatory Commission (the “CSRC”). Under the Special Regulations, upon approval of the CSRC, a company may agree, in the underwriting agreement in respect of an issue of overseas listed foreign invested shares, to retain not more than 15% of the aggregate number of overseas listed foreign invested shares proposed to be issued after accounting for the number of underwritten shares.

The share offering price may be equal to or greater than nominal value, but shall not be less than nominal value.

The transfer of shares by shareholders should be conducted via the legally established stock exchange or in accordance with other methods as stipulated by the State Council. Transfer of registered shares by a shareholder must be made by means of an endorsement or by other means stipulated by laws or administrative regulations. Bearer shares are transferred by delivery of the share certificates to the transferee.

Shares held by a promoter of a company shall not be transferred within one year after the date of the company’s incorporation. Shares issued by a company prior to the public offer of its shares shall not be transferred within one year from the date of listing of the shares of the company on a stock exchange. Directors, supervisors and senior management of a company shall not transfer over 25% of the shares held by each of them in the company each year during their term of office and shall not transfer any share of the company held by each of them within one year after the listing date. There is no restriction under the PRC Company Law as to the percentage of shareholding a single shareholder may hold in a company.

Transfers of shares may not be entered in the register of shareholders within 20 days before the date of a shareholders’ meeting or within five days before the record date set for the purpose of distribution of dividends.

Allotment and Issue of Shares

All issue of shares of a joint stock limited company shall be based on the principles of equality and fairness. The same class of shares must carry equal rights. Shares issued at the same time and within the same class must be issued on the same conditions and at the same price. It may issue shares at par value or at a premium, but it may not issue shares below the par value.

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A company shall obtain the approval of the CSRC to offer its shares to the overseas public. Under the Special Regulations, shares issued to foreign investors by joint stock limited companies and listed overseas are known as “overseas listed and foreign invested shares.” Shares issued to investors within the PRC by joint stock limited companies, which also issues overseas listed and foreign shares, are known as “domestic shares.” Upon approval of the securities regulatory authority of the State Council, a company issuing overseas listed and foreign invested shares in total shares determined by the issuance program may agree with underwriters in the underwriting agreement to retain not more than 15% of the aggregate number of overseas listed and foreign invested shares outside the underwritten amount. The issuance of the retained shares is deemed to be a part of this issuance.

Registered Shares

Under the Company Law, the shareholders may make capital contributions in cash, or alternatively may make capital contributions with such valuated non-monetary property as physical items, intellectual property rights, and land-use rights that may be valued in monetary term and may be transferred in accordance with the law. Pursuant to the Special Regulations, overseas listed and foreign invested shares issued shall be in registered form, denominated in Renminbi and subscribed for in a foreign currency. Domestic shares issued shall also be in registered form.

Under the PRC Company Law, when the company issues shares in registered form, it shall maintain a register of shareholders, stating the following matters:

• the name and domicile of each shareholder;

• the number of shares held by each shareholder;

• the serial numbers of shares held by each shareholder; and

• the date on which each shareholder acquired the shares.

Increase of Share Capital

According to the Company Law, when the joint stock limited company issues new shares, resolutions shall be passed by a shareholders’ general meeting, approving the class and number of the new shares, the issue price of the new shares, the commencement and end of the new share issuance and the class and amount of new shares to be issued to existing shareholders. When the company launches a public issuance of new shares with the approval of the securities regulatory authorities of the State Council, it shall publish a prospectus and financial and accounting reports, and prepare the share subscription form. After the new share issuance has been paid up, the change shall be registered with the company registration authorities and an announcement shall be made.

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Reduction of Share Capital

A company may reduce its registered capital in accordance with the following procedures prescribed by the PRC Company Law:

• it shall prepare a balance sheet and a property list;

• the reduction of registered capital shall be approved by a shareholders’ general meeting;

• it shall inform its creditors of the reduction in capital within 10 days and publish an announcement of the reduction in the newspaper within 30 days after the resolution approving the reduction has been passed;

• creditors may within 30 days after receiving the notice, or within 45 days of the public announcement if no notice has been received, require the company to pay its debts or provide guarantees covering the debts;

• it shall apply to the relevant administration of industry and commerce for the registration of the reduction in registered capital.

Repurchase of Shares

According to the PRC Company Law, a joint stock limited company may not purchase its shares other than for one of the following purposes: (i) to reduce its registered capital; (ii) to merge with another company that holds its shares; (iii) to grant its shares to its employees as incentives; (iv) to purchase its shares from shareholders who are against the resolution regarding the merger or division with other companies at a shareholders’ general meeting; (v) where its shares are used to convert corporate bonds issued by a listed company that can be converted into stocks; or (vi) where it is necessary for a listed company to maintain its corporate value and stockholders’ equity.

The purchase of shares on the grounds set out in (i) to (ii) above shall require approval by way of a resolution passed by the shareholders’ general meeting. Following the purchase of shares in accordance with the foregoing, such shares shall be cancelled within 10 days from the date of purchase in the case of (i) above and transferred or cancelled within six months in the case of (ii) or (iv) above, or in the event of a purchase made pursuant to Item (iii), (v) or (vi), hold a total number of its own shares not more than 10% of the total shares issued by the company and transfer or cancel within three years of the purchase.

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Transfer of Shares

Shares held by shareholders may be transferred in accordance with the relevant laws and regulations. Pursuant to the PRC Company Law, transfer of shares by shareholders shall be carried out at a legally established securities exchange or in other ways stipulated by the State Council. No modifications of registration in the share register caused by transfer of registered shares shall be carried out within 20 days prior to the convening of shareholder’s general meeting or five days prior to the base date for determination of dividend distributions. However, where there are separate provisions by law on alternation of registration in the share register of listed companies, those provisions shall prevail.

Under the PRC Company Law, shares issued prior to the public issuance of shares shall not be transferred within one year from the date of the joint stock limited company’s listing on a stock exchange. Directors, supervisors and the senior management shall declare to the company their shareholdings in the company and any changes of such shareholdings. They shall not transfer more than 25% of all the shares they hold in the company annually during their tenure. They shall not transfer the shares they hold within one year from the date on which the company’s shares are listed and commenced trading on a stock exchange, nor within six months after their resignation from their positions with the company.

Shareholders

Under the PRC Company Law and the Mandatory Provisions, the rights of holders of ordinary shares of a joint stock limited company include:

• the right to attend or appoint a proxy to attend shareholders’ general meetings and to vote thereat;

• the right to transfer shares in accordance with laws, administrative regulations and provisions of the articles of association;

• the right to inspect the company’s articles of association, share register, counterfoil of company debentures, minutes of shareholder’s general meetings, resolutions of meetings of the board of directors, resolutions of meetings of the board of supervisors and financial and accounting reports and to make proposals or enquires on the company’s operations;

• the right to bring an action in the people’s court to rescind resolutions passed by shareholder’s general meetings and board of directors where the articles of association is violated by the above resolutions;

• the right to receive dividends and other types of interest distributed in proportion to the number of shares held;

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• in the event of the termination or liquidation of the company, the right to participate in the distribution of residual properties of the company in proportion to the number of shares held; and

• other rights granted by laws, administrative regulations, other regulatory documents and the company’s articles of association.

The obligations of a shareholder include the obligation to abide by the Company’s articles of association, to pay the subscription moneys in respect of the shares subscribed for and in accordance with the form of making capital contributions, to be liable for the company’s debts and liabilities to the extent of the amount of his or her subscribed shares and any other shareholders’ obligation specified in the company’s articles of association.

Shareholders’ General Meetings

The shareholders’ general meeting is the organ of authority of the company, which exercises its powers in accordance with the PRC Company Law.

Under the PRC Company Law, the shareholders’ general meeting exercises the following principal powers:

• to decide on the company’s operational policies and investment plans;

• to elect or remove the directors and supervisors (other than the supervisor representative of the employees of the company) and to decide on matters relating to the remuneration of directors and supervisors;

• to examine and approve reports of the board of directors;

• to examine and approve reports of the board of supervisors;

• to examine and approve the company’s proposed annual financial budget and final accounts;

• to examine and approve the company’s proposals for profit distribution plans and loss recovery plans;

• to decide on any increase or reduction of the company’s registered capital;

• to decide on the issue of bonds by the company;

• to decide on issues such as merger, division, dissolution and liquidation of the company and other matters;

• to amend the company’s articles of association; and

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• other powers as provided for in the articles of association.

Shareholders’ annual general meetings are required to be held once every year. Under the PRC Company Law, an extraordinary shareholders’ general meeting is required to be held within two months after the occurrence of any of the following:

• the number of directors is less than the number stipulated by the law or less than two thirds of the number specified in the articles of association;

• the aggregate losses of the company which are not recovered reach one-third of the company’s total paid-in share capital;

• when shareholders alone or in aggregate holding 10% or more of the company’s shares request the convening of an extraordinary general meeting;

• whenever the board of directors deems necessary;

• when the board of supervisors so requests; or

• other circumstances as provided for in the articles of associations.

Under the PRC Company Law, shareholders’ general meetings shall be convened by the board of directors, and presided over by the chairman of the board of directors. In the event that the chairman is incapable of performing or does not perform his duties, the meeting shall be presided over by the vice chairman. In the event that the vice chairman is incapable of performing or not performing his duties, a director nominated by more than half of directors shall preside over the meeting.

Where the board of directors is incapable of performing or not performing its duties of convening the shareholders’ general meeting, the board of supervisors shall convene and preside over such meeting in a timely manner. In case the board of supervisors fails to convene and preside over such meeting, shareholders alone or in aggregate holding more than 10% of the company’s shares for 90 days consecutively may unilaterally convene and preside over such meeting.

Under the PRC Company Law, notice of shareholders’ general meeting shall state the time and venue of and matters to be considered at the meeting and shall be given to all shareholders 20 days before the meeting. Notice of extraordinary shareholder’s general meetings shall be given to all shareholders 15 days prior to the meeting.

Pursuant to the Mandatory Provisions, modification or abrogation of rights conferred to any class of shareholders shall be passed both by special resolution of shareholders’ general meeting and by class meeting convened respectively by shareholders of the affected class.

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Under the PRC Company Law, shareholders present at shareholders’ general meeting have one vote for each share they hold, save that shares held by the company are not entitled to any voting rights.

Pursuant to the provisions of the articles of association or a resolution of the shareholders’ general meeting, the accumulative voting system may be adopted for the election of directors and supervisors at the shareholders’ general meeting. Under the accumulative voting system, each share shall be entitled to vote equivalent to the number of directors or supervisors to be elected at the shareholders’ general meeting and shareholders may consolidate their voting rights when casting a vote.

Pursuant to the PRC Company Law and the Mandatory Provisions, resolutions of the shareholders’ general meeting shall be adopted by more than half of the voting rights held by the shareholders present at the meeting. However, resolutions of the shareholders’ general meeting regarding the following matters shall be adopted by more than two-thirds of the voting rights held by the shareholders present at the meeting: (i) amendments to the articles of association; (ii) the increase or decrease of registered capital; (iii) the issue of any types of shares, warrants or other similar securities; (iv) the issue of debentures; (v) the merger, division, dissolution, or liquidation; (vi) other matters considered by the shareholders’ general meeting, by way of an ordinary resolution, to be of a nature which may have a material impact on the company and should be adopted by a special resolution.

Under the PRC Company Law, meeting minutes shall be prepared in respect of decisions on matters discussed at the shareholders’ general meeting. The chairman of the meeting and directors attending the meeting shall sign to endorse such minutes. The minutes shall be kept together with the shareholders’ attendance register and the proxy forms.

Board

Under the PRC Company Law, a joint stock limited company shall have a board of directors, which shall consist of 5 to 19 members. Members of the board of directors may include representatives of the employees of the company, who shall be democratically elected by the company’s staff at the staff representative assembly, general staff meeting or otherwise. The term of a director shall be stipulated in the articles of association, but no term of office shall last for more than three years. Directors may serve consecutive terms if re-elected. A director shall continue to perform his duties in accordance with the laws, administrative regulations and articles of association until a duly re-elected director takes office, if re-election is not conducted in a timely manner upon the expiry of his term of office, or if the resignation of directors results in the number of directors being less than the quorum.

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Under the PRC Company Law, the board of directors mainly exercises the following powers:

• to convene the shareholders’ general meetings and report on its work to the shareholders’ general meetings;

• to implement the resolutions passed in shareholders’ general meetings;

• to decide on the company’s business plans and investment proposals;

• to formulate the company’s proposed annual financial budget and final accounts;

• to formulate the company’s profit distribution proposals and loss recovery proposals;

• to formulate proposals for the increase or reduction of the company’s registered capital and the issuance of corporate bonds;

• to prepare plans for the merger, division, dissolution and change in the form of the company;

• to decide on the set-up of internal management organization of the company;

• to decide on appointment or dismissal of the managers and their remuneration, and to decide on appointment or dismissal of deputy managers and finance controller of the company and their remuneration based on the nomination by the managers;

• to formulate the company’s basic management system; and

• to exercise any other power under the articles of association.

Board Meetings

Under the PRC Company Law, meetings of the board of directors of a joint stock limited company shall be convened at least twice a year. Notice of meeting shall be given to all directors and supervisors 10 days before the meeting. Interim board meetings may be proposed to be convened by shareholders representing more than 10% of voting rights, more than one-third of the directors or the board of supervisors. The chairman shall convene and preside over such meeting within 10 days after receiving such proposal. Meetings of the board of directors shall be held only if more than half of the directors are present. Resolutions of the board of directors shall be passed by more than half of all directors. Each director shall have one vote for resolutions to be approve by the board of directors. Directors shall attend board meetings in person. If a director is unable to attend a board meeting, he may appoint another director by a written power of attorney specifying the scope of the authorization to attend the meeting on his behalf.

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If a resolution of the board of directors violates the laws, administrative regulations or the articles of association, and as a result of which the company sustains serious losses, the directors participating in the resolution are liable to compensate the company. However, if it can be proved that a director expressly objected to the resolution when the resolution was voted on, and that such objection was recorded in the minutes of the meeting, such director may be released from that liability.

Chairman of the Board

Under the PRC Company Law, the board of directors shall appoint a chairman and may appoint a vice chairman. The chairman and the vice chairman are elected with approval of more than half of all the directors. The chairman shall convene and preside over board meetings and examine the implementation of board resolutions. The vice chairman shall assist the work of the chairman. In the event that the chairman is incapable of performing or not performing his duties, the duties shall be performed by the vice chairman. In the event that the vice chairman is incapable of performing or not performing his duties, a director nominated by more than half of the directors shall perform his duties.

Qualification of Directors

The PRC Company Law provides that the following persons may not serve as a director:

• a person who is unable or has limited ability to undertake any civil liabilities;

• a person who has been convicted of an offense of bribery, corruption, embezzlement or misappropriation of property, or the destruction of socialist market economy order; or who has been deprived of his political rights due to his crimes, in each case where less than five years have elapsed since the date of completion of the sentence;

• a person who has been a former director, factory manager or manager of a company or an enterprise that has entered into insolvent liquidation and who was personally liable for the insolvency of such company or enterprise, where less than three years have elapsed since the date of the completion of the bankruptcy and liquidation of the company or enterprise;

• a person who has been a legal representative of a company or an enterprise that has had its business license revoked due to violations of the law and has been ordered to close down by law and the person was personally responsible, where less than three years have elapsed since the date of such revocation; or

• a person who is liable for a relatively large amount of debts that are overdue.

Other circumstances under which a person is disqualified from acting as a director are set out in the Mandatory Provisions.

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Board of Supervisors

A joint stock limited company shall have a board of supervisors composed of not less than three members. The board of supervisors is made up of representatives of the shareholders and an appropriate proportion of representatives of the employees of the company. The actual proportion shall be stipulated in the articles of association, provided that the proportion of representatives of the employees shall not be less than one third of the supervisors. Representatives of the employees of the company in the board of supervisors shall be democratically elected by the employees at the employees’ representative assembly, employees’ general meeting or otherwise.

The directors and senior management may not act concurrently as supervisors.

The board of supervisors shall appoint a chairman and may appoint a vice chairman. The chairman and the vice chairman of the board of supervisors are elected with approval of more than half of all the supervisors. The chairman of the board of supervisors shall convene and preside over the meetings of the board of supervisors. In the event that the chairman of the board of supervisors is incapable of performing or not performing his duties, the vice chairman of the board of supervisors shall convene and preside over the meetings of the board of supervisors. In the event that the vice chairman of the board of supervisors is incapable of performing or not performing his duties, a supervisor nominated by more than half of the supervisors shall convene and preside over the meetings of the board of supervisors.

Each term of office of a supervisor is three years and he or she may serve consecutive terms if re-elected. A supervisor shall continue to perform his duties in accordance with the laws, administrative regulations and articles of association until a duly re-elected supervisor takes office, if re-election is not conducted in a timely manner upon the expiry of his term of office, or if the resignation of supervisors results in the number of supervisors being less than the quorum.

The board of supervisors exercises the following powers:

• to review the company’s financial position;

• to supervise the directors and senior management in their performance of their duties and to propose the removal of directors and senior management who have violated laws, regulations, the articles of association or the resolutions of shareholders’ meeting;

• when the acts of directors and senior management are harmful to the company’s interests, to require correction of those acts;

• to propose the convening of extraordinary shareholders’ general meetings and to convene and preside over shareholders’ general meetings when the board of directors fails to perform the duty of convening and presiding over shareholders’ general meeting under this law;

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• to initiate proposals for resolutions to shareholders’ general meeting;

• to initiate proceedings against directors and senior management; and

• other powers specified in the articles of association.

Supervisors may attend board meetings and make enquiries or proposals in respect of board resolutions. The board of supervisors may initiate investigations into any irregularities identified in the operation of the company and, where necessary, may engage an accounting firm to assist their work at the company’s expense.

Manager and Senior Management

Under the PRC Company Law, a company shall have the manager who shall be appointed or removed by the board of directors. The manager shall report to the board of directors and may exercise the following powers:

• to manage the business and administration of the company and arrange for the implementation of resolutions of the board of directors;

• to arrange for the implementation of the company’s annual business plans and investment proposals;

• to formulate the plan for set-up of internal management organization of the company;

• to formulate the basic administration system of the company;

• to formulate the company’s detailed rules;

• to recommend the appointment and dismissal of deputy managers and person in charge of finance;

• to appoint or dismiss other administration officers (other than those required to be appointed or dismissed by the board of directors); and

• to other powers conferred by the board of directors or the articles of association.

The manager shall comply with other provisions of the articles of association concerning his/her powers. The manager shall attend board meetings.

According to the PRC Company Law, senior management shall mean the manager, deputy manager(s), person-in-charge of finance, board secretary (in case of a listed company) of a company and other personnel as stipulated in the articles of association.

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Duties of Directors, Supervisors and Senior Management

Directors, supervisors and senior management of the company are required under the PRC Company Law to comply with the relevant laws, regulations and the articles of association, and have fiduciary and diligent duties to the company. Directors, supervisors and senior management are prohibited from abusing their powers to accept bribes or other unlawful income and from misappropriating of the company’s properties. Directors and senior management are prohibited from:

• misappropriation of the company’s capital;

• depositing the company’s capital into accounts under his own name or the name of other individuals;

• loaning company funds to others or providing guarantees in favor of others supported by the company’s assets in violation of the articles of association or without prior approval of the shareholders’ general meeting or board of directors;

• entering into contracts or deals with the company in violation of the articles of association or without prior approval of the shareholders’ general meeting;

• using their position and powers to procure business opportunities for themselves or others that should have otherwise been available to the company or operating for their own benefits or managing on behalf of others businesses similar to that of the company without prior approval of the shareholders’ general meeting;

• accept and possess commissions paid by a third party for transactions conducted with the company;

• unauthorized divulgence of confidential business information of the company; or

• other acts in violation of their duty of loyalty to the company.

A director, supervisor or senior management who contravenes any law, regulation or the company’s articles of association in the performance of his duties resulting in any loss to the company shall be personally liable to the company.

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Finance and Accounting

Under the PRC Company Law, a company shall establish financial and accounting systems according to laws, administrative regulations and the regulations of the financial department of the State Council and shall at the end of each financial year prepare a financial and accounting report which shall be audited by an accounting firm as required by law. The company’s financial and accounting report shall be prepared in accordance with provisions of the laws, administrative regulations and the regulations of the financial department of the State Council.

Pursuant to the PRC Company Law, the company shall deliver its financial and accounting reports to all shareholders within the time limit stipulated in the articles of association and make its financial and accounting reports available at the company for inspection by the shareholders at least 20 days before the convening of an annual general meeting of shareholders. It must also publish its financial and accounting reports.

When distributing each year’s after-tax profits, it shall set aside 10% of its after-tax profits into a statutory common reserve fund (except where the fund has reached 50% of its registered capital).

If its statutory common reserve fund is not sufficient to make up losses of the previous year, profits of the current year shall be applied to make up losses before allocation is made to the statutory common reserve fund pursuant to the above provisions.

After allocation of the statutory common reserve fund from after-tax profits, it may, upon a resolution passed at the shareholders’ general meeting, allocate discretionary common reserve fund from after-tax profits.

The remaining after-tax profits after making up losses and allocation of common reserve fund shall be distributed in proportion to the number of shares held by the shareholders, unless otherwise stipulated in the articles of association.

Shares held by the Company shall not be entitled to any distribution of profit.

The premium received through issuance of shares at prices above par value and other incomes required by the financial department of the State Council to be allocated to the capital reserve fund shall be allocated to the company’s capital reserve fund.

The Company’s reserve fund shall be applied to make up losses of the company, expand its business operations or be converted to increase the registered capital of the company. However, the capital reserve fund may not be applied to make up the company’s losses. Upon the conversion of statutory common reserve fund into capital, the balance of the statutory common reserve fund shall not be less than 25% of the registered capital of the company before such conversion.

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The Company shall have no other accounting books except the statutory accounting books. Its assets shall not be deposited in any accounts opened in the name of any individual.

Appointment and Retirement of Accounting Firms

Pursuant to the PRC Company Law, the appointment or dismissal of accounting firms responsible for the auditing of the company shall be determined by shareholders’ general meeting or board of directors in accordance with provisions of articles of association. The accounting firm should be allowed to make representations when the shareholders’ general meeting or board of directors conducts a vote on the dismissal of the accounting firm. The company should provide true and complete accounting evidences, books, financial and accounting reports and other accounting data to the accounting firm it employs without any refusal, withholding and misrepresentation.

The Special Regulations provide that a company shall employ an independent accounting firm complying with the relevant regulations of the State to audit its annual report and review and check other financial reports of the company. The accounting firm’s term of office shall commence from their appointment at a shareholders’ annual general meeting to the end of the next shareholders’ annual general meeting.

Distribution of Profits

According to the PRC Company Law, a company shall not distribute profits before losses are covered and the statutory common reserve is drawn. Under the Mandatory Provisions, a company shall appoint receiving agents on behalf of holders of the overseas listed and foreign invested shares to receive on behalf of such shareholders dividends and other distributions payable in respect of their overseas listed and foreign invested shares.

Amendments to Articles of Association

Any amendments to the company’s articles of association must be made in accordance with the procedures set out in the company’s articles of association. Any amendment of provisions incorporated in the articles of association in connection with the Mandatory Provisions will only be effective after approval by the company’s approval department authorized by the State Council and the CSRC. In relation to matters involving the company’s registration, its registration with the authority must also be changed.

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Dissolution and Liquidation

According to the PRC Company Law, a company shall be dissolved by reason of the following: (i) the term of its operations set down in the articles of association has expired or other events of dissolution specified in the articles of association have occurred; (ii) the shareholders’ general meeting have resolved to dissolve the company; (iii) the company is dissolved by reason of merger or division; (iv) the business license is revoked; the company is ordered to close down or be dissolved; or (v) the company is dissolved by the people’s court in response to the request of shareholders holding shares that represent more than 10% of the voting rights of all its shareholders, on the grounds that the company suffers significant hardship in its operation and management that cannot be resolved through other means, and the ongoing existence of the company would bring significant losses for shareholders.

In the event of (i) above, it may carry on its existence by amending its articles of association. The amendment of the articles of association in accordance with provisions set out above shall require approval of more than two-thirds of voting rights of shareholders attending a shareholders’ general meeting.

Where the company is dissolved in the circumstances described in subparagraphs (i), (ii), (iv), or (v) above, a liquidation group shall be established and the liquidation process shall commence within 15 days after the occurrence of an event of dissolution. The members of the company’s liquidation group shall be composed of its directors or the personnel appointed by the shareholders’ general meeting. If a liquidation group is not established within the stipulated period, creditors may apply to the people’s court and request the court to appoint relevant personnel to form the liquidation group. The people’s court should accept such application and form a liquidation group to conduct liquidation in a timely manner.

The liquidation group shall exercise the following powers during the liquidation period:

• to handle the company’s assets and to prepare a balance sheet and an inventory of the assets;

• to notify creditors through notice or public announcement;

• to deal with the company’s outstanding businesses related to liquidation;

• to pay any tax overdue as well as tax amounts arising from the process of liquidation;

• to claim credits and pay off debts;

• to handle the company’s remaining assets after its debts have been paid off; and

• to represent the company in civil lawsuits.

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The liquidation group shall notify the company’s creditors within 10 days after its establishment and issue public notices in newspapers within 60 days. A creditor shall lodge his claim with the liquidation group within 30 days after receiving notification, or within 45 days of the public notice if he did not receive any notification. A creditor shall state all matters relevant to his creditor rights in making his claim and furnish evidence. The liquidation group shall register such creditor rights. The liquidation group shall not make any debt settlement to creditors during the period of claim.

Upon liquidation of properties and the preparation of the balance sheet and inventory of assets, the liquidation group shall draw up a liquidation plan to be submitted to the shareholders’ general meeting or people’s court for confirmation.

The company’s remaining assets after payment of liquidation expenses, wages, social insurance expenses and statutory compensation, outstanding taxes and debts shall be distributed to shareholders according to their shareholding proportion. It shall continue to exist during the liquidation period, although it can only engage in any operating activities that are related to the liquidation. The company’s properties shall not be distributed to the shareholders before repayments are made in accordance to the foregoing provisions.

Upon liquidation of the company’s properties and the preparation of the balance sheet and inventory of assets, if the liquidation group becomes aware that the company does not have sufficient assets to meet its liabilities, it must apply to the people’s court for a declaration for bankruptcy.

Following such declaration, the liquidation group shall hand over all matters relating to the liquidation to the people’s court.

Upon completion of the liquidation, the liquidation group shall submit a liquidation report to the shareholders’ general meeting or the people’s court for verification. Thereafter, the report shall be submitted to the registration authority of the company in order to cancel the company’s registration, and a public notice of its termination shall be issued. Members of the liquidation group are required to discharge their duties honestly and in compliance with the relevant laws. Members of the liquidation group shall be prohibited from abusing their powers to accept bribes or other unlawful income and from misappropriating the company’s properties.

A member of the liquidation group is liable to indemnify the company and its creditors in respect of any loss arising from his intentional or gross negligence.

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Overseas Listing

According to the Special Regulations, a company shall obtain the approval of the CSRC to list its shares overseas. A company’s plan to issue overseas listed and foreign invested shares and domestic shares which has been approved by the CSRC may be implemented by the board of directors of the company by way of separate issue within 15 months after approval is obtained from the CSRC.

Loss of Share Certificates

If a registered share certificate is lost, stolen or destroyed, the relevant shareholder may apply, in accordance with the relevant provisions set out in the Civil Procedure Law, to a people’s court to declare such certificate invalid. After the people’s court declares the invalidity of such certificate, the shareholder may apply to the company for a replacement share certificate. A separate procedure regarding the loss of overseas listed and foreign invested share certificates is provided for in the Mandatory Provisions.

Merger and Demerger

Companies may merge through merger by absorption or through the establishment of a newly merged entity. If it merges by absorption, the company which is absorbed shall be dissolved. If it merges by forming a new corporation, both companies will be dissolved.

SECURITIES LAW AND REGULATIONS

The PRC has promulgated a number of regulations that relate to the issue and trading of shares and disclosure of information. In October 1992, the State Council established the Securities Committee and the CSRC. The Securities Committee is responsible for coordinating the drafting of securities regulations, formulating securities-related policies, planning the development of securities markets, directing, coordinating and supervising all securities-related institutions in the PRC and administering the CSRC.

The CSRC is the regulatory arm of the Securities Committee and is responsible for the drafting of regulatory provisions of securities markets, supervising securities companies, regulating public offers of securities by PRC companies in the PRC or overseas, regulating the trading of securities, compiling securities related statistics and undertaking relevant research and analysis. In 1998, the State Council consolidated the two departments and the CSRC has since taken over the original functions of the Securities Commission.

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On December 25, 1995, the State Council promulgated and implemented the Regulations of the State Council Concerning Domestic Listed Foreign Shares of Joint Stock Limited Companies《國務院關於股份有限公司境內上市外資股的規定》 ( ). These regulations deal mainly with the issue, subscription, trading and declaration of dividends and other distributions of domestic listed and foreign invested shares and disclosure of information of joint stock limited companies having domestic listed and foreign invested shares.

The Securities Law came into force on July 1, 1999, and was revised for the first time on August 28, 2004, for the second time on October 27, 2005, for the third time on June 29, 2013, for the fourth time on August 31, 2014 and for the fifth time on December 28, 2019. This law is the first national securities law in China, which is divided into 14 chapters and 226 articles, regulating (including) the issuance and trading of securities, the acquisition of listed companies, stock exchanges, securities companies and the duties and responsibilities of the securities regulatory authority under the State Council. The Securities Law comprehensively regulates the activities of China’s securities market. Article 224 of the Securities Law stipulates that a domestic enterprise shall comply with the relevant provisions of the State Council in issuing securities or listing its securities abroad directly or indirectly. Article 225 of the Securities Law stipulates that the specific measures for subscription and trading of shares of domestic companies in foreign currencies shall be separately formulated by the State Council. At present, the shares (including H shares) issued and traded abroad are still subject to the rules and regulations promulgated by the State Council and the CSRC.

ARBITRATION AND ENFORCEMENT OF ARBITRAL AWARDS

The Arbitration Law of the PRC《中華人民共和國仲裁法》 ( ) (the “Arbitration Law”) was passed by the Standing Committee of the NPC on August 31, 1994, became effective on September 1, 1995 and was amended on August 27, 2009 and September 1, 2017. Under the Arbitration Law, an arbitration committee may, before the promulgation by the PRC Arbitration Association of arbitration regulations, formulate interim arbitration rules in accordance with the Arbitration Law and the Civil Procedure Law. Where the parties have by agreement provided arbitration as the method for dispute resolution, the people’s court will refuse to handle the case except when the arbitration agreement is declared invalid.

The Mandatory Provisions require an arbitration clause to be included in the articles of association of an issuer. Matters in arbitration include any disputes or claims in relation to the issuer’s affairs or as a result of any rights or obligations arising under its articles of association, the PRC Company Law or other relevant laws and administrative regulations.

Where a dispute or claim of rights referred to in the preceding paragraph is referred to arbitration, the entire claim or dispute must be referred to arbitration, and where those persons who have a cause of action based on the same facts giving rise to the dispute or claim or those persons required to participate in resolution of dispute or claim are the company's shareholders. directors, supervisors or other senior officers or such person is the company itself, such person must comply with the arbitration. Disputes in respect of the definition of shareholder and disputes in relation to the issuer’s register of shareholders need not be resolved by arbitration.

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A claimant may elect for arbitration to be carried out at either the China International Economic and Trade Arbitration Commission (中國國際經濟貿易仲裁委員會) (“CIETAC”) in accordance with its rules or the Hong Kong International Arbitration center (“HKIAC”) in accordance with its Securities Arbitration Rules (the “Securities Arbitration Rules”). Once a claimant refers a dispute or claim to arbitration, the other party shall submit to the arbitral body elected by the claimant. If the claimant elects for arbitration to be carried out at the HKIAC, any party to the dispute or claim may apply for a hearing to take place in Shenzhen in accordance with the Securities Arbitration Rules. In accordance with the Arbitration Regulations of CIETAC《中國國際經濟貿易仲裁委員會仲 ( 裁規則》) which was amended on November 4, 2014 and implemented on January 1, 2015, CIETAC shall deal with economic and trading disputes over contractual or non-contractual transactions, including disputes involving Hong Kong based on the agreement of the parties. The arbitration commission is established in Beijing and its branches and centers have been set up in Shenzhen, Shanghai, Tianjin and Chongqing.

Under the Arbitration Law and the Civil Procedure Law, an arbitral award is final and binding on the parties. If a party fails to comply with an award, the other party to the award may apply to the people’s court for enforcement. A people’s court may refuse to enforce an arbitral award made by an arbitration commission if there is any irregularity on the procedures or composition of arbitrators specified by law or the award exceeds the scope of the arbitration agreement or is outside the jurisdiction of the arbitration commission.

A party seeking to enforce an arbitral award of PRC arbitration panel against a party who, or whose property, is not within the PRC, may apply to a foreign court with jurisdiction over the case for enforcement. Similarly, an arbitral award made by a foreign arbitration body may be recognized and enforced by the PRC courts in accordance with the principles of reciprocity or any international treaty concluded or acceded to by the PRC. The PRC acceded to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “New York Convention”) adopted on June 10, 1958 pursuant to a resolution of the Standing Committee of the NPC passed on December 2, 1986. The New York Convention provides that all arbitral awards made in a state which is a party to the New York Convention shall be recognized and enforced by all other parties to the New York Convention, subject to their right to refuse enforcement under certain circumstances, including where the enforcement of the arbitral award is against the public policy of the state to which the application for enforcement is made. It was declared by the Standing Committee of the NPC simultaneously with the accession of the PRC that (i) the PRC will only recognize and enforce foreign arbitral awards on the principle of reciprocity and (ii) the PRC will only apply the New York Convention in disputes considered under PRC laws to arise from contractual and non-contractual mercantile legal relations.

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An arrangement was reached between Hong Kong and the Supreme People’s Court for the mutual enforcement of arbitral awards. On June 18, 1999, the Supreme People’s Court adopted the Arrangement on Mutual Enforcement of Arbitral Awards between Mainland China and Hong Kong《關於內地與香港特別行政區相互執行仲裁裁決的安排》 ( ), which became effective on February 1, 2000. In accordance with this arrangement, awards made by PRC arbitral authorities under the Arbitration Law can be enforced in Hong Kong, and Hong Kong arbitration awards are also enforceable in the PRC.

Judicial judgment and its enforcement

According to the Arrangement on Mutual Recognition and Enforcement of Judgments in Civil and Commercial Matters by the Courts of the Mainland China and of the Hong Kong Special Administrative Region Pursuant to Agreed Jurisdiction by Parties Concerned《最高人民法院關於內地與香港特別行政區法院相互認可和執行當事人協議管轄 ( 的民商事案件判決的安排》) promulgated by the Supreme People’s Court on July 3, 2008 and implemented on August 1, 2008, in the case of final judgment, defined with payment amount and enforcement power, made between the court of China and the court of the Hong Kong Special Administrative Region in a civil and commercial case with written jurisdiction agreement, any party concerned may apply to the People’s Court of China or the court of the Hong Kong Special Administrative Region for recognition and enforcement based on this arrangement. “Choice of court agreement in written” refers to a written agreement defining the exclusive jurisdiction of either the People’s Court of China or the court of the Hong Kong Special Administrative Region in order to resolve dispute with particular legal relation occurred or likely to occur by the party concerned. Therefore, the party concerned may apply to the Court of China or the court of the Hong Kong Special Administrative Region to recognize and enforce the final judgment made in China or Hong Kong that meet certain conditions of the aforementioned regulations.

SUMMARY OF MATERIAL DIFFERENCES BETWEEN HONG KONG AND PRC COMPANY LAW

The Hong Kong laws applicable to a company incorporated in Hong Kong are the Companies Ordinance and the Companies (Winding up and Miscellaneous Provisions) Ordinance and are supplemented by common law and the rules of equity that are applicable to Hong Kong. As a joint stock limited company established in the PRC that is seeking a [REDACTED] of shares on the Stock Exchange, our Company is governed by the PRC Company Law and all other rules and regulations promulgated pursuant to the PRC Company Law.

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Set out below is a summary of certain material differences between Companies Ordinance applicable to a company incorporated in Hong Kong and the PRC Company Law applicable to a joint stock limited company incorporated under the PRC Company Law. This summary is, however, not intended to be an exhaustive comparison.

Incorporation of Corporate

Under Hong Kong company law, a company with share capital, is incorporated by the Registrar of Companies in Hong Kong which issues a certificate of incorporation to the Company upon its incorporation and the company will acquire an independent corporate existence. A company may be incorporated as a public company or a private company. Pursuant to the Companies Ordinance, the articles of association of a private company incorporated in Hong Kong shall contain certain preemptive provisions. A public company’s articles of association do not contain such pre-emptive provisions.

Under the PRC Company Law, a joint stock limited company may be incorporated by promotion or stock flotation. The newly amended PRC Company Law which came into effect on October 26, 2018, has no provisions on minimum registered capital of joint stock companies, except that laws, administrative regulations and State Council decisions have separate provisions on paid-in registered capital and the minimum registered capital of joint stock companies, in which case the company should follow such provisions.

Hong Kong law does not prescribe any minimum capital requirement for a Hong Kong company.

Share Capital

The Hong Kong company law does not provide for authorized share capital. The share capital of a company incorporated in Hong Kong would be its issued share capital. The full proceeds of a share issue will be credited to share capital and becomes the company’s share capital. The directors of a company incorporated in Hong Kong may, with the prior approval of the shareholders if required, issue new shares of the company.

The PRC Company Law provides that any increase in our Company’s registered capital must be approved by its shareholders’ general meeting and the relevant PRC governmental and regulatory authorities.

Under the PRC Company Law, the shares may be subscribed for in the form of money or non-monetary assets (other than assets not entitled to be used as capital contributions under relevant laws and administrative regulations). If capital contribution is made other than in cash, valuation and verification of the assets contributed must be carried out and converted into shares according to the laws. Non-monetary assets used for capital contributions shall not be overvalued or undervalued. Where laws or administrative regulations provide otherwise, those provisions shall prevail. There is no such restriction on a company incorporated in Hong Kong under Hong Kong Law.

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Restrictions on Shareholding and Transfer of Shares

Under the PRC Company Law, a promoter of a joint stock limited company is not allowed to transfer the shares it holds for a period of one year after the date of establishment of the company. Shares issued prior to the public offering cannot be transferred within one year from the listing date of the shares on a stock exchange. Shares transferred each year by the directors, supervisors and senior management of a joint stock limited company during their respective term of office shall not exceed 25% of the total shares they held in the company, and the shares they held in the company cannot be transferred within one year from the listing date of the shares, and also cannot be transferred within half a year after such person leave office. The articles of association may set other restrictive requirements on the transfer of the company’s shares held by its directors, supervisors and senior management.

There are no such restrictions on shareholdings and transfers of shares under Hong Kong law apart from the six-month lockup on the company’s issue of shares and the 12-month lockup on controlling shareholders’ disposal of shares, as illustrated by the undertakings given by the Company and our Controlling Shareholders to the Stock Exchange.

Financial Assistance for Acquisition of Shares

The PRC Company Law does not prohibit or restrict a joint stock limited company or its subsidiaries from providing financial assistance for the purpose of an acquisition of its own or its holding company’s shares. However, the Mandatory Provisions contain special restrictions provisions on a company and its subsidiaries on providing aforesaid financial assistance similar to those under the Companies Ordinance.

Variation of Class Rights

The PRC Company Law has no specific provision relating to variation of class rights. However, the PRC Company Law states that the State Council can promulgate separate regulations relating to other kinds of shares. The Mandatory Provisions contain elaborate provisions relating to the circumstances which are deemed to be variations of class rights and the approval procedures required to be followed in respect thereof. The relevant provisions have been incorporated in the Articles of Association, summary of which is set out in “Appendix VI—Summary of the Articles of Association” to this document.

Under the Companies Ordinance, no rights attached to any class of shares can be varied except (i) with the passing of a special resolution by the shareholders of the relevant class at a separate meeting sanctioning the variation, (ii) with the written consent of shareholders representing at least three-fourths of the total voting rights of shareholders of the relevant class, or (iii) if there are provisions in the articles of association relating to the variation of those rights, then in accordance with those provisions.

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As required by the Listing Rules and the Mandatory Provisions, our Company has adopted in the Articles of Association provisions protecting class rights in a similar manner to those found in Hong Kong law. Holders of overseas listed foreign invested shares and domestic shares are defined in the Articles of Association as different classes of shareholders, provided however that the special procedures for approval by separate class shareholders shall not apply to the following circumstances: (i) where the Company issues domestic shares and overseas listed foreign shares, upon approval by a special resolution of the general meeting, either separately or concurrently once every 12 months, and the quantity of domestic shares and overseas listed foreign shares intended to be issued does not exceed 20 percent of the outstanding shares of the respective classes; (ii) where the Company’s plan to issue domestic shares and overseas-listed foreign shares upon its incorporation is implemented within 15 months from the date of approval by the securities regulatory authorities under the State Council; (iii) where, as approved by the State Council or its authorized regulatory authorities, the transfer of domestic shares of the Company to foreign shares and the listing and trading of such shares on an overseas stock exchange.

Directors, Senior Management and Supervisors

The PRC Company Law, unlike Companies Ordinance, does not contain any requirements relating to the declaration of directors’ interests in material contracts, restrictions on companies providing certain benefits to directors and guarantees in respect of directors’ liability and prohibitions against compensation for loss of office without shareholders’ approval. The Mandatory Provisions, however, contain certain restrictions on interested contracts and specify the circumstances under which a director may receive compensation for loss of office.

Supervisory Board

Under the PRC Company Law, a joint stock limited company’s directors and members of the senior management are subject to the supervision of supervisory board. There is no mandatory requirement for the establishment of supervisory board for a company incorporated in Hong Kong. The Mandatory Provisions provide that each supervisor owes a duty, in the exercise of his or her powers, to act in good faith and honestly in what he or she considers to be in the best interests of the company and to exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances.

Derivative Action by Minority Shareholders

Hong Kong law permits minority shareholders to initiate a derivative action on behalf of all shareholders against directors who have committed a breach of their fiduciary duties to the company if the directors control a majority of votes at a general meeting, thereby effectively preventing a company from suing the directors in breach of their duties in its own name.

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The PRC Company Law provides shareholders of a joint stock limited company with the right so that in the event where the directors and senior management violate their obligations and cause damages to a company, the shareholders individually or jointly holding more than 1% of the shares in the company for more than 180 consecutive days may request in writing the supervisory board to initiate proceedings in the people’s court. In the event that the supervisory board violates their obligations and cause damages to company, the above said shareholders may send written request to the board of directors to initiate proceedings in the people’s court. Upon receipt of aforesaid written request from the shareholders, if the supervisory board or the board of directors refuses to initiate such proceedings, or has not initiated proceedings within 30 days from the date of receipt of the request, or if under urgent situations, failure of initiating immediate proceeding may cause irremediable damages to the company, the above said shareholders shall, for the benefit of the company’s interests, have the right to initiate proceedings directly to the people’s court in their own name.

The Mandatory Provisions also provides further remedies against the directors, supervisors and senior management who breach their duties to the company.

Protection of Minorities

Under Hong Kong law, the company may be wound up by the court if the court considers that it is just and equitable to do so, in addition, a shareholder who complains that the affairs of a company incorporated in Hong Kong are conducted in a manner unfairly prejudicial to his or her interests may petition to the court to make an appropriate order regulating the affairs of the company. Furthermore, under certain circumstances, the Financial Secretary of Hong Kong may appoint inspectors who are given extensive statutory powers to investigate the affairs of a company incorporated in Hong Kong. The PRC law does not contain similar safeguards.

The PRC Company Law provides that, a company which encounters substantial operational or management difficulties, and its continuance will cause significant loss to the interests of its shareholders and the situation cannot be resolved by other means, shareholders of the company who hold more than ten percent of the voting rights of all shareholders may apply to a people’s court for the dissolution of the company.

The Mandatory Provisions, however, except as required by laws and regulations or the Listing Rules provides that a controlling shareholder shall not exercise its voting rights in a manner prejudicial to the interests of the shareholders generally or of a proportion of the shareholders of a company to relieve a director or supervisor of his or her duty to act honestly in the best interests of the company or to approve the expropriation by a director or supervisor of the company’s assets or the individual rights of other shareholders.

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Notice of Shareholders’ General Meetings

Under the PRC Company Law, notice of a shareholders’ annual general meeting and an interim general meeting must be given to shareholders no less than 20 days and 15 days before the date of such meeting, respectively. For a company incorporated in Hong Kong, the notice period for an annual general meeting is at least 21 days and in any other case, at least 14 days for a limited company and at least 7 days for an unlimited company.

Quorum for Shareholders’ General Meetings

Under Hong Kong law, the quorum for a general meeting must be at least two members unless the articles of association of the company otherwise provide. For companies with only one member, the quorum must be one member.

The PRC Company Law does not specify the quorum for a shareholders’ general meeting.

Voting

Under Hong Kong law, an ordinary resolution is passed by a simple majority of votes cast by members present in person or by proxy at a general meeting and a special resolution is passed by a majority of not less than three-fourths of votes cast by members present in person or by proxy at a general meeting.

Under the PRC Company Law, the passing of any resolution requires affirmative votes of shareholders representing more than half of the voting rights held by the shareholders who attend the general meeting except in cases of proposed amendments to a company’s articles of association, increase or decrease of registered capital, merger, division or dissolution, or change of corporation form, which require affirmative votes of shareholders representing more than two-thirds of the voting rights held by the shareholders who attend the general meeting.

Financial Disclosure

Under the PRC Company Law, a joint stock limited company is required to make available at the company for inspection by shareholders its financial report 20 days before its shareholders’ annual general meeting. In addition, a joint stock limited company of which the shares are publicly issued must publish its financial report.

The Companies Ordinance requires a company incorporated in Hong Kong to send to every shareholder a copy of its balance sheet, auditors’ report and directors’ report, which are to be presented before the company in its annual general meeting, not less than 21 days before such meeting.

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Information on Directors and Shareholders

The PRC Company Law gives shareholders the right to inspect the company’s articles of association, minutes of the shareholders’ general meetings and financial and accounting reports. Under the Articles of Association, shareholders have the right to inspect and copy (at reasonable charges) certain information on shareholders and on directors which is similar to the shareholders’ rights of companies incorporated in Hong Kong under Hong Kong law.

The Mandatory Provisions and regulations requires that a company must, in addition to preparing financial statements according to the PRC GAAP, have its financial statements prepared and audited in accordance with international accounting standards or accounting standards of the overseas listing place, and such financial statements must also contain a statement of the financial effect of the material differences (if any) from the financial statements prepared in accordance with the PRC GAAP. The lower of the after-tax profits stated in the abovementioned two kinds of financial statements shall prevail in the allocation of after-tax profits for the accounting year. The company shall publish its financial reports twice in each accounting year. An interim financial report shall be published within 60 days after the end of the first six months of each accounting year, while an annual financial report shall be published within 120 days after the end of each accounting year.

The Special Regulations require that there should not be any contradiction between the information disclosed within and outside the PRC and that, to the extent that there are differences in the information disclosed in accordance with the relevant PRC and overseas laws, regulations and requirements of the relevant stock exchanges, such differences should also be disclosed simultaneously.

Information on Directors and Shareholders

The PRC Company Law gives shareholders the right to inspect the company’s articles of association, minutes of the shareholders’ general meetings, share register, counterfoil of company debentures, resolutions of board meetings, resolutions of the supervisory board and financial and accounting reports, which is similar to the shareholders’ rights of Hong Kong companies under Hong Kong law.

Receiving Agent

Under the PRC Company Law and Hong Kong law, dividends once declared become liabilities payable to shareholders. The limitation period for debt recovery action under Hong Kong law is six years, while under the PRC laws this limitation period is three years. The Mandatory Provisions require the relevant company to appoint a trust company registered under the Hong Kong Trustee Ordinance (Chapter 29 of the Laws of Hong Kong) as a receiving agent to receive on behalf of holders of shares dividends declared and all other monies owed by the company in respect of its shares.

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Corporate Reorganization

Corporate reorganization involving a company incorporated in Hong Kong may be effected in a number of ways, such as a transfer of the whole or part of the business or property of the company in the course of voluntary winding up to another company pursuant to Section 237 of the Companies (Winding Up and Miscellaneous Provisions) Ordinance or a compromise or arrangement between the company and its creditors or between the company and its members pursuant to Section 673 and Section 674 of the Companies Ordinance, which requires the sanction of the court. Under the PRC laws, merger, division, dissolution or change the form of a joint stock limited company has to be approved by shareholders at the shareholders’ general meeting.

Dispute Arbitration

In Hong Kong, disputes between shareholders on the one hand, and a company incorporated in Hong Kong or its directors on the other hand, may be resolved through legal proceedings in the courts. The Mandatory Provisions provide that such disputes should be submitted to arbitration at either the Hong Kong International Arbitration Centre or the China International Economic and Trade Arbitration Commission, at the claimant’s choice.

Mandatory Deductions

Under the PRC Company Law, a joint stock limited company is required to contribute 10% of the profit into their statutory reserve funds upon distribution of their post-tax profits of the current year. There are no corresponding provisions under Hong Kong law.

Remedies of the Company

Under the PRC Company Law, if a director, supervisor or senior management in carrying out his or her duties infringes any law, administrative regulation or the articles of association of a company, which results in damage to the company, that director, supervisor or senior management should be responsible to the company for such damages. In addition, the Listing Rules require listed companies’ articles of association to provide for remedies of the company similar to those available under Hong Kong law (including rescission of the relevant contract and recovery of profits from a director, supervisor or senior management).

Dividends

The Company has the power in certain circumstances to withhold, and pay to the relevant tax authorities, any tax payable under PRC laws on any dividends or other distributions payable to a shareholder. Under Hong Kong law, the limitation period for an action to recover a debt (including the recovery of dividends) is six years, whereas under PRC laws, the relevant limitation period is three years.

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Fiduciary Duties

In Hong Kong, there is the common law concept of the fiduciary duty of directors. Under the PRC Company Law and the Special Regulations, directors, supervisors and senior management should be loyal and diligent. Under the Mandatory Provisions, directors, supervisors and senior management are not permitted, without the knowledge and approval of the shareholders’ general meeting, to engage in any activities which compete with the interests of the company.

Closure of Register of Shareholders

The Companies Ordinance requires that the register of shareholders of a company must not generally be closed for the registration of transfers of shares for more than 30 days (extendable to 60 days in certain circumstances) in a year, whereas, as required by the Mandatory Provisions, share transfers shall not be registered within 30 days before the date of a shareholders’ general meeting or within five days before the base date set for the purpose of distribution of dividends.

Amendment to Articles of Association

A PRC issuer may not permit or cause any amendment to be made to its articles of association which would contravene the PRC Company Law, the Mandatory Provisions and the Listing Rules.

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This Appendix contains the summary of the principal provisions of the Articles of Association adopted by our Company on May 10, 2021. The Articles of Association of the Company shall take effect on the date of the H Shares being [REDACTED] on the Stock Exchange. The main purpose of this appendix is to provide an overview of the Company’s Articles of Association for potential investors, so it may not contain all the information that is important.

1. SHARES AND REGISTERED CAPITAL AND TRANSFER OF SHARE

The Company shall have ordinary shares at all times. The Company may create other classes of shares according to it needs, upon approval by the authorities that are authorised by the State Council.

All the shares issued by the Company shall have a par value, which shall be RMB1.00 for each share.

Shares of the same class and in the same issue shall be issued on the same conditions and at the same price. Any entity or individual shall pay the same price for each of the shares it/he/she subscribes for.

The Company’s Shareholders of each class enjoy equal rights in any distribution in form of dividend or otherwise. The Company shall not exercise any rights to freeze or otherwise prejudice any rights attached to the shares held by any person who directly or indirectly has interest in the Company solely for the reason that such person fails to disclose to the Company any such interests.

The Company may, based on its business and development needs and in accordance with the relevant requirements of laws, regulations and Articles of Association, approve the increase of the registered capital. The Company can increase the registered capital in the following manners:

(I) public issuance of shares;

(II) non-public issuance of shares;

(III) placement or distribution of new shares to existing shareholders;

(IV) capitalisation of capital reserves;

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(V) other ways permitted by laws, administrative regulations and approved by CSRC.

The Company’s increase of capital by issuing new shares shall, after being approved in accordance with the procedure required by the Articles of Association, be conducted in accordance with the procedures stipulated in the relevant national laws and administrative regulations.

2. REDUCTION OF CAPITAL AND REPURCHASE OF SHARES

The Company may reduce its registered capital. If the Company reduces its registered capital, it shall do so by the procedures set forth in the Company Law, other relevant regulations and these Articles of Association.

If the Company is to reduce its registered capital, it must prepare a balance sheet and a list of its property.

The Company may, in the following circumstances, buy back its own outstanding shares according to laws, regulations, departmental rules, normative documents and, listing rules of the stock exchange in which the company’s shares are listed, and after being approved through the procedures provided for Articles of Association:

(I) to cancel shares for reducing the Company’s registered capital;

(II) to merge with other companies that hold shares in the Company;

(III) to use the shares for employee shareholding schemes or as share incentives;

(IV) to acquire the shares of shareholders (upon their request) who vote against to any resolution adopted at any general meetings on the merger or division of the Company;

(V) to use the shares to satisfy the conversion of those corporate bonds convertible into shares issued by the listed company;

(VI) for the need of safeguarding corporate value and Shareholders’ equity;

(VII) other methods permitted by laws and administrative regulations.

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Unless the Company has already entered the liquidation stage, it must comply with the following provisions in buying back its outstanding shares:

(I) if the Company buys back shares at their par value, the amount thereof shall be deducted from the book balance of distributable profit of the Company and from the proceeds of the new shares offer made to repurchase the old shares;

(II) if the Company buys back shares at a price higher than their par value, the portion corresponding to their par value shall be deducted from the book balance of distributable profit of the Company and from the proceeds of the new shares offer made to repurchase the old shares; and the portion in excess of the par value shall be handled according to the following methods:

(1) if the shares being bought back were issued at their par value, the amount shall be deducted from the book balance of distributable profit of the Company;

(2) if the shares being bought back were issued at a price higher than their par value, the amount shall be deducted from the book balance of distributable profit of the Company and the proceeds of the new share offer made to repurchase the old shares, provided that the amount paid out of the proceeds of the new share offer shall not exceed the aggregate of the premiums received on the issue of the old shares repurchased nor shall it exceed the amount in the Company’s premium account (or capital reserve account) (including the premiums from the new share offer) at the time of the buyback;

(III) the Company shall make payments for the following applications out of the Company’s distributable profits:

(1) acquisition of the right to buy back its own shares;

(2) modification of any contract for the buy back of its shares;

(3) release from any of its obligations under a buyback contract.

(IV) after the Company’s registered capital has been reduced by the aggregate par value of the cancelled shares in accordance with relevant regulations, the amount deducted from the distributable profit for payment of the par value of the repurchased shares shall be credited to the Company’s premium account (or capital reserve account).

Laws, administrative regulations, departmental rules, regulatory documents or relevant requirements of the securities regulatory authorities in the place where the Company’s shares are listed on financial processing about repurchasing of shares as referred to above, shall prevail.

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3. FINANCIAL ASSISTANCE FOR THE PURCHASE OF COMPANY SHARES

Neither the Company nor its subsidiaries shall at any time provide any financial assistance in any form to purchasers or prospective purchasers of shares of the Company. Purchasers of shares of the Company as referred to above shall include persons that directly or indirectly assumes obligations as a result of purchasing shares of the Company.

Neither the Company nor its subsidiaries shall at any time provide any financial assistance in any form to the above obligors in order to reduce or release them from their obligations.

The term “financial assistance” shall include but not limited to financial assistance in the forms set forth below:

(I) gift;

(II) security (including the assumption of liability or the provision of property by the guarantor to secure the performance of obligations by the obligor), indemnity (not including, however, indemnity arising from the Company’s own fault), release or waiver of any rights;

(III) provision of a loan or conclusion of a contract under which the obligations of the Company are to be fulfilled before the fulfilment of obligations of the other party to the contract, or a change in the parties to, or the assignment of rights under, such loan or contract;

(IV) any other form of financial assistance given by the Company when the Company is insolvent or has no net asset or when its net assets would thereby be reduced to a material extent.

The “assumption of obligations” means the assumption of obligations by way of contract or by way of arrangement (irrespective of whether such contract or arrangement is enforceable or not, and irrespective of whether such obligations are to be borne by the obligor solely or jointly with other persons), or by any other means which results in a change in the obligor’s financial position.

The following acts shall not be deemed to be prohibited:

(I) the provision of financial assistance by the Company where the financial assistance is provided in good faith in the interests of the Company and the principal purpose of which is not for the acquisition of shares in the Company, or where the provision of financial assistance is an incidental part of certain overall plan of the Company;

(II) the lawful distribution of the Company’s properties by way of dividends;

(III) the allotment of bonus shares as dividends;

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(IV) a reduction of registered capital, buyback of shares or adjustment of the share capital structure effected in accordance with these Articles of Association;

(V) the provision by the Company of a loan within its scope of operation and in the ordinary course of its business (provided that the net assets of the Company are not thereby reduced or that, to the extent that the net assets are thereby reduced, the financial assistance is provided out of its distributable profit);

(VI) the monetary contribution by the Company to the employee share option schemes (provided that the net assets of the Company are not thereby reduced or that, to the extent that the net assets are thereby reduced, the financial assistance is provided out of its distributable profit).

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4. SHARE CERTIFICATES AND REGISTER OF MEMBERS

(1) Share Certificates

The share certificates of the Company shall be in registered form.

The share certificates of the Company shall contain items provided in the Company Law and other items required to be specified by the rules of the stock exchange in which Company’s share certificates are listed.

The share certificates shall be signed by the Chairman of the Company. Where the stock exchange on which the share certificates of the Company are listed requires the share certificates to be signed by other senior management, the share certificates shall also be signed by such other relevant senior management. The share certificates shall take effect after being affixed with the Company’s seal under the authorization of the Board, or with the securities seal specially required or affixed by way of printing, under the seal of the Company. The signatures of the Chairman or other relevant senior management of the Company on the share certificates may also be in printed form.

If the Company’s shares are issued and traded in paperless form, the regulations of the securities regulator of the place where the shares of the Company are listed shall apply.

(2) Register of Members

The Company shall keep a register of shareholders, in which the following particulars shall be recorded:

(I) the name, address (place of domicile), occupation or nature of business of each shareholder;

(II) the class and number of shares held by each shareholder;

(III) the amount paid-up or payable in respect of shares held by each shareholder;

(IV) the serial numbers of the shares held by each shareholder;

(V) the date on which each shareholder was registered as a shareholder;

(VI) the date on which any shareholder ceased to be a shareholder.

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Unless there is evidence to the contrary, the register of members shall be the sufficient evidence of the shareholders’ shareholding in the Company.

The Company may, in accordance with the mutual understanding and agreements made between the CSRC and overseas securities regulatory authorities, keep its register of holders of overseas-listed foreign shares outside of the PRC and appoint overseas agent(s) to manage such register. The original register of holders of overseas listed shares listed on the Stock Exchange shall be kept in Hong Kong.

The Company shall maintain a duplicate of the register of holders of overseas listed foreign shares at its place of domicile. The appointed overseas agent(s) shall ensure consistency between the original version and the duplicate register of holders of overseas listed foreign shares at all times. If there is any inconsistency between the original and the duplicate register of holders of overseas-listed foreign shares, the original version shall prevail.

The Company shall maintain a complete register of members. The register of members shall include the following parts:

(I) the register of members which is maintained at the Company’s place of domicile (other than those share registers which are described in paragraphs (II) and (III) of this Article);

(II) the register of shareholders of overseas-listed shares of the Company maintained at the place where the overseas securities exchange on which the shares are listed is located;

(III) the register of members which is maintained in such other place as the Board may consider necessary for the purpose of listing of the Company’s shares.

Different parts of the register of members shall not overlap one another. No transfer of the shares registered in any part of the register shall, during the existence of that registration, be registered in any other part of the register of members.

Alteration or rectification of each part of the register of members shall be made in accordance with the laws of the place where that part of the register of members is maintained.

The PRC laws and regulations, departmental rules, regulatory documents and the Listing Rules on the period of suspension of share registration and transfers before the convening of the shareholders’ meeting or the benchmark date, on which the company decides to distribute dividends, shall prevail.

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When the Company intends to convene a general meeting, distribute dividends, enter into liquidation and engage in other activities that require determination of shareholdings, the Board shall determine a specific date as equity determination date, registered shareholders at the end of which shall be the shareholders entitled to the relevant rights and interests.

Any person who challenges the register of members and requests to have his/her name included in or removed from the register of members may apply to the court having jurisdiction for rectification of the register of members.

Any shareholder who is registered in, or any person who requests to have his name (title) entered into, the register of members may apply to the Company for issuance of a replacement share certificate in respect of such shares (the “relevant shares”) if his/her share certificate (the “original share certificate”) is lost.

The Company shall not have any obligation to indemnify any person for any damage suffered thereby arising out of the cancellation of the original share certificate or the issuance of a replacement share certificate, unless such person concerned can prove fraud on the part of the Company.

5. RIGHTS AND OBLIGATIONS OF THE SHAREHOLDERS

A shareholder of the Company is a person who lawfully holds shares of the Company and whose name (title) is recorded in the register of members. A shareholder shall enjoy relevant rights and assume relevant obligations in accordance with the class and number of shares he/she holds. Shareholders holding the same class of shares shall enjoy the same rights and assume the same obligations.

Where the shareholder of the Company is a legal person, its legal representative or an agent of such legal representative or a person authorized by the resolution of the board of directors or other decision-making authorities shall exercise its rights on its behalf.

Holders of the ordinary shares of the Company shall enjoy the following rights:

(I) the right to dividends and other profit distributions in proportion to the number of shares held;

(II) the right to attend or appoint proxies to attend general meetings and to exercise the voting right;

(III) the right to supervise, present proposals or raise enquiries about the Company’s business operations;

(IV) the right to transfer, give as a gift or pledge the shares in their possession in accordance with laws, administrative regulations, the rules of the stock change on which the shares of the Company are listed and the Articles of Association;

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(V) the right to obtain relevant information in accordance with the Articles of Association, including:

1. The right to obtain a copy of the Articles of Association, subject to payment of the cost;

2. The right to inspect and copy, subject to a payment of a reasonable fee:

(1) all parts of the copies of register of shareholders;

(2) personal particulars of each of the Company’s Directors, Supervisors, general managers and other senior management members, including:

① present and former name and alias;

② principal address (residence);

③ nationality;

④ main profession and all other part-time occupations and duties;

⑤ identification document and its number;

(3) reports showing the state of the Company’s share capital in issue and special resolution of the shareholders;

(4) reports showing the aggregate par value, quantity, the maximum and minimum prices paid in respect of each class of shares repurchased by the Company since the end of the last financial year, and the aggregate amount paid by the Company for this purpose;

(5) minutes of general meetings (only available for inspection to Shareholders), reports of the board meetings, auditors and the Supervisory Committee meetings, the latest audited financial statements of the Company

(6) and counterfoils of corporate bonds.

The Company shall deposit the documents in clauses (1) to (5) above (other than clause (2)) and other applicable documents at its Hong Kong address as required by the Listing Rules available for free inspection of the public and the holders of overseas-listed foreign shares.

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(VI) in the event of the termination or liquidation of the Company, the right to participate in the distribution of the remaining property of the Company in proportion to the number of shares held;

(VII) to acquire the shares of shareholders (upon their request) who vote against to any resolution adopted at any general meetings on the merger or division of the Company;

(VIII) to file lawsuit to the people’s court against the conducts, which damage the interests of the Company or infringe on the legal rights and interests of the shareholders and claiming for relevant rights according to the Company Law, other laws and administrative regulations;

(IX) any other rights conferred by laws, administrative regulations, departmental rules or the rules of the stock exchanges in which the Company’s shares are listed and the Articles of Association.

Shareholders of ordinary shares of the Company shall have the following obligations:

(I) to abide by the Articles of Association;

(II) to pay the share subscription price based on the shares subscribed for by them and the method of acquiring such shares;

(III) not to abuse the shareholders’ rights to prejudice the interests of the Company or other shareholders; not to abuse the status of the Company as an independent legal person or the limited liability of the shareholders to prejudice the interests of any creditors of the Company;

Where any shareholder of the Company abuses the shareholders’ rights and incurs losses to the Company or other shareholders, such shareholder shall be liable for the damages according to the law.

Where shareholders of the Company abuse the Company’s status as an independent legal person and the limited liability of the shareholders for the purposes of evading repayment of debts, thereby materially impairing the interests of the creditors of the Company, such shareholders shall be jointly and severally liable for the debts owed by the Company.

(IV) not to refund shares, except in the cases regulated by the laws and regulations;

(V) to assume other obligations required by laws, administrative regulations, the rules of the stock exchanges in which the Company’s shares are listed and the Articles of Association.

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Shareholders shall not be liable to make any further contributions to the share capital other than according to the terms agreed by the subscribers at the time of share subscription.

The term “controlling shareholder” refers to a person that satisfies any one of the following conditions:

(I) When acting alone or acting in concert with other persons, such a person may select more than half of the directors;

(II) When acting alone or acting in concert with other persons, such a person may exercise more than 30% (inclusive) of the voting rights or control the exercise of more than 30% (inclusive) of the voting rights of the Company;

(III) When acting alone or acting in concert with other persons, such a person holds more than 30% (inclusive) of the outstanding shares of the Company;

(IV) When acting alone or acting in concert with other persons, such a person has de facto control of the Company by other methods.

Except for the obligations required by the laws, administrative regulations or the listing rules of the stock exchanges in which the Company’s shares are listed, the Controlling Shareholder shall not exercise its voting rights in respect of the following matters in a manner prejudicial to the interests of all or part of the shareholders:

(I) to waive a director or supervisor of his responsibility to act honestly in the best interests of the Company;

(II) to approve the expropriation by a director or supervisor (for his/her own benefits or for the benefits of another person), in any way, of the Company’s properties, including but not limited to any opportunities beneficial to the Company;

(III) to approve the expropriation by a director or supervisor (for his own benefits or for the benefits of another person) of personal rights of other shareholders, including but not limited to rights to distributions and voting rights save pursuant to a corporate restructuring tabled at a general meeting for approval in accordance with the Articles of Association.

The Company’s controlling shareholders (defined above) shall not use their association relationship to damage the interests of the Company. They shall be held liable for damages if, as a result of violating a regulation, they cause the Company to sustain a loss. Where their violation of the relevant provisions causes losses to the Company, they shall be liable for compensation. The controlling shareholders should in strict accordance with laws exercise their rights as investors, and shall not damage the legitimate rights and interests of the Company and other shareholders by means of profit allocation, assets restructuring, external investment, fund use or loan guarantees.

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6. GENERAL MEETING

(1) General Rules for Convening a General Meeting

The general meeting is the organ of the authority of the Company and shall exercise the following functions and powers in accordance with the law:

(I) to decide on the operating policies and investment plans of the Company;

(II) to elect and replace directors who are not representatives of the employees and to decide on matters relating to their remuneration;

(III) to elect and replace supervisors who are not representatives of the employees and to decide on matters relating to their remuneration;

(IV) to consider and approve reports of the Board;

(V) to consider and approve reports of the Supervisory Committee;

(VI) to consider and approve the annual financial budgets and final accounts of the Company;

(VII) to consider and approve the profit distribution plans and loss recovery plans of the Company;

(VIII) to make resolutions on increasing or reducing the registered capital of the Company;

(IX) to make resolutions on the merger, division, dissolution, liquidation or change in corporate form of the Company;

(X) to make resolutions on the issuance of corporate bonds;

(XI) to make resolutions on the engagement, dismissal or non-renewal of the engagement of accounting firms by the Company;

(XII) to amend the Articles of Association;

(XIII) to consider matters raised by a shareholder alone or shareholders together holding more than three percent (inclusive) of the voting shares of the Company;

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(XIV) to decide on the repurchase of the Company’s shares under the situations stipulated in items (1) and (2) of Article 29 herein;

(XV) to consider and approve the share incentive plan;

(XVI) to determine the matters relating to the purchases and disposals of the Company’s material assets or the provisions of guarantees within one year with an amount exceeding 30 percent of the Company’s latest audited total assets;

(XVII) other matters which required by the laws, administrative regulations, the listing rules of the stock exchanges of the place where the Company’s shares are listed and the Articles of Association, should be resolved by shareholders at general meetings.

The general meeting may authorize or entrust the board of directors to handle the matters authorized or entrusted thereby, provided that the relevant PRC laws, regulations, regulatory documents and mandatory requirements under the listing rules of the stock exchanges of the listing venue are not violated.

The Company shall not conclude any contract with any person other than a director, a supervisor, a general manager or other senior management whereby such person is put in charge of the management of the whole or a substantial part of the Company’s business without the prior approval of the general meeting.

The general meetings consist of annual general meetings and extraordinary general meetings. The general meetings shall be convened by the Board of Directors. The annual general meeting shall hold once every year within six months from the end of the previous accounting year. The extraordinary general meeting shall be convened as and when necessary.

The Board of Directors shall convene an extraordinary general meeting within two months from the date of the occurrence of any of the following circumstances:

(I) where the number of directors is less than the number stipulated in the Company Law or two-thirds of the number specified in the Articles of Association;

(II) where the unrecovered losses of the Company reach one-third of the total amount of its share capital;

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(III) where the shareholder(s) who hold(s) 10% (inclusive) or more of the outstanding voting shares of the Company request(s) in writing for the convening of an extraordinary general meeting;

(IV) whenever the board of directors deems it necessary or the supervisory committee requests so;

(V) other conditions as required under the laws, administrative regulations, departmental rules, the listing rules of the stock exchanges of the place where the Company’s shares are listed or the Articles of Association.

(2) Proposals of General Meetings

Shareholders who individually or jointly hold more than three percent of the shares of the Company may submit extempore motions in writing to the board of directors ten days prior to the date of general meeting. The board of directors shall give a notice to other shareholders within two days after receipt of the motion, and submit such extempore motion to the general meeting for consideration. The contents of such an extempore motion shall fall within the authority of general meetings, with definite topics to discuss and specific matters to resolve.

(3) Notices of General Meetings

Notice of a general meeting shall satisfy the following requirements:

(I) be in writing;

(II) specific venue, date and time of the meeting;

(III) matters to be considered at the meeting;

(IV) any information and explanations necessary to be made available to the Shareholders for such Shareholders to make sound decisions about the matters to be discussed. This principle includes (but not limited to) the provision of the specific terms and contract(s), if any, of the proposed transaction(s) and serious explanations about the reasons and effects when the Company proposes mergers, repurchase of shares, equity restructuring or other restructuring;

(V) in the event that any of the Directors, Supervisors, General Manager and other senior management has material interests in matters to be discussed, the nature and extent of the interests shall be disclosed. If the matters to be discussed affect any Director, Supervisor, General Manager and other senior management as a Shareholder in a manner different from the manner they affect other Shareholders of the same class, the difference shall be explained;

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(VI) the full text of any special resolution to be proposed for approval at the meeting;

(VII) a prominent statement that all Shareholders are eligible for attending the general meeting and are entitled to appoint one or more proxies to attend and vote at such meeting on his/her behalf, and that such proxy does not need to be a Shareholders of the Company;

(VIII) the time and venue for lodging a proxy form for the meeting.

The notice of a general meeting shall be sent to the shareholders (whether or not such shareholders are entitled to vote at the meeting) by methods as required by the Articles of Association of the Company. In case of delivery by post, the addresses of the recipients shall be those registered in the share register.

For holders of Domestic Shares, the notice of a general meeting may also be given by way of announcement. “The announcement” referred to in the preceding paragraph shall be published in one or more newspapers designated by China Securities Regulatory Commission before the date of the meeting; after the publication of the announcement, the holders of Domestic Shares shall be deemed to have received the notice of the relevant general meeting.

The notice of a general meeting served on the holders of overseas listed foreign shares may be published through the websites of the Stock Exchange and the Company. Upon the publication of the announcement, all holders of overseas-listed foreign shares shall be deemed to have received the notice of the relevant shareholders’ general meeting.

(4) Convening of Shareholders’ General Meeting

Any Shareholder entitled to attend and vote at the general meeting shall have the right to appoint one or several persons (who may not be Shareholders) to act as his or her proxy to attend and vote at the meeting on his or her behalf. Such proxy(ies) may, pursuant to the instructions of the Shareholder(s), exercise the following rights:

(I) the Shareholders’ right to speak at the general meeting;

(II) the right to demand a poll by himself/herself or jointly with others;

(III) the right to exercise voting rights by a show of hands or by a poll, provided that where more than one proxy is appointed, the proxies may only exercise such voting rights by a poll.

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The instrument appointing a proxy shall be in writing under the hand of the appointer or his attorney duly authorised in writing, or if the appointer is a legal entity, either under seal or under the hand of a director or the duly authorised attorney. Such power of attorney shall contain the number of shares to be represented by the proxy.

The instrument appointing a proxy shall be deposited at the residence of the Company or at some other place specified for that purpose in the notice of meeting no later than twenty four hours prior to the meeting at which the proxy is authorized to vote or twenty four hours before the time specified for the voting.

A general meeting convened by the Board shall be presided over and chaired by the chairman of the Board. If the chairman is unable to attend the meeting, the chairman of the Board may designate a director to preside over and take the chair of the meeting in his stead. If no chairman of the meeting has been designated, shareholders present shall choose one person to be the chairman of the meeting. Where the shareholders fail to elect a chairman for any reasons, the shareholder (including his proxy) presents in person or by proxy who holds the largest number of shares carrying the right to vote thereat shall be the chairman of the meeting.

(5) Voting and Resolutions of Shareholders’ General Meeting

Resolutions of a shareholders’ general meeting include ordinary resolutions and special resolutions. An ordinary resolution of a shareholders’ general meeting shall be passed by affirmative votes of more than half of the Company’s total voting shares held by shareholders attending the meeting in person or by proxies. A special resolution of a shareholders’ general meeting shall be passed by affirmative votes of more than two-thirds of the Company’s total voting shares held by shareholders attending the meeting in person or by proxies.

Shareholders (including their proxies) who vote at a general meeting shall exercise their voting rights according to the number of voting shares they represent, with one vote for each share.

When a poll is held, shareholders (including their proxies) who are entitled to two or more votes are not required to cast all their votes in favor of or against a resolution. When the number of votes against and in favor is equal, the chairman of the meeting shall be entitled to an additional vote.

The following matters shall be resolved by way of special resolutions at a general meeting:

(I) increase or reduction of registered capital and issue of shares of any class, stock warrants or other similar securities;

(II) issuance of corporate bonds;

(III) division, merger, dissolution and liquidation and change in the form of the Company;

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(IV) amendments to the Articles of Association;

(V) the Company’s acquisition or disposal of major assets or providing guarantees within 1 year with the transaction amount exceeding 30% of the Company’s latest audited total assets;

(VI) other matters as resolved by an ordinary resolution at general meetings that will have a material impact on the Company and accordingly shall be approved by a special resolution;

(VII) the share incentive plan;

(VIII) matters requiring approval by special resolutions in accordance with laws, administrative regulations or the Articles of Association and as required by the stock exchange on which the shares of the Company are listed.

7. SPECIAL VOTING PROCEDURES FOR CLASS SHAREHOLDERS

Shareholders holding different classes of shares shall be class Shareholders. Class Shareholders shall enjoy the rights and assume the obligations in accordance with laws, administrative regulations, the listing rules of stock exchange on which the shares of the Company are listed and the Articles of Association.

Save for Shareholders of Shares of other classes, the holders of Domestic Shares and holders of Overseas Listed Foreign Shares are deemed to be different classes of Shareholders. The Company shall not proceed to change or abrogate the rights of class Shareholders unless such proposed change or abrogation has been approved by way of a special resolution at a general meeting and by a separate shareholder meeting convened by the class Shareholders so affected in accordance with the Articles of Association.

The following circumstances shall be deemed as change or abrogation of the rights of a certain class shareholder:

(I) to increase or decrease the number of shares of such class, or to increase or decrease the number of shares of a class’ voting rights, distribution rights or other privileges equal or superior to those of the shares of such class;

(II) to change all or part of the shares of such class into shares of another class (unless otherwise agreed in the Articles of Association) or to change all or part of the shares of another class into shares of that class or to grant relevant conversion rights;

(III) to cancel or reduce rights to accrued dividends or cumulative dividends attached to shares of the said class;

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(IV) to reduce or cancel rights attached to the shares of the said class to preferentially receive dividends or to receive distributions of assets in a liquidation of the Company;

(V) to add, cancel or reduce share conversion rights, options, voting rights, transfer rights, pre-emptive placing rights, or rights to acquire securities of the Company attached to the shares of the said class;

(VI) to cancel or reduce rights to receive Company payables in a particular currency attached to the shares of the said class;

(VII) to create a new class of shares with voting rights, distribution rights or other privileges equal or superior to those of the shares of the said class;

(VIII) to restrict the transfer or ownership of the shares of the said class or to impose additional restrictions;

(IX) to issue rights to subscribe for, or to convert into, shares of the said class or another class;

(X) to increase the rights and privileges of the shares of another class;

(XI) to restructure the Company in such a way to cause Shareholders of different classes to undertake liabilities disproportionately during the restructuring;

(XII) to amend or cancel provisions in this chapter.

Shareholders of the affected class, whether or not with the rights to vote at general meetings originally, shall have the right to vote at shareholders’ class meetings in respect of matters referred to in items (II) to (VIII) and (XI) to (XII) above, except that interested Shareholders shall not vote at such shareholders’ class meetings.

The term “interested shareholders” in the preceding paragraph shall mean:

(I) in the case of a repurchase of shares by an offer to all shareholders of the Company or by open dealing on a stock exchange pursuant to Article 30 of these Articles of Association, a “controlling shareholder” as defined in Article 58;

(II) in the case of a repurchase of shares by an off-market agreement pursuant to Articles 30 of these Articles of Association, a holder of the shares to which the proposed agreement relates;

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(III) in the case of a restructuring of the Company, an “interested shareholder” would mean a shareholder who assumes less liability than any shareholders of the same class or who has an interest in the proposed restructuring different from the interests of shareholders of the same class.

Resolution of a shareholders’ class meeting shall be passed only by two-thirds or more of the total voting rights being held by the Shareholders of that class, who are entitled to do so, present and vote at the shareholders’ class meeting in accordance with the Articles of Association.

When convening a class meeting, the Company shall issue a written notice within the time requirement of the non-class meeting, specifying the matters proposed to be considered and the date and place of the meeting.

If there are any special requirements under the listing rules of the stock exchange(s) of the place(s) where the Company’s shares are listed, such requirements shall prevail.

In the following circumstances, the special procedures for voting by class shareholders shall not apply:

(I) where the Company issues domestic shares and overseas-listed shares, upon approval by a special resolution of the general meeting, either separately or concurrently once every 12 months, and the quantity of domestic investment shares and overseas listed shares intended to be issued does not exceed 20 percent of the outstanding shares of the respective classes;

(II) where the Company’s plan to issue the domestic shares and the overseas listed shares at the time of its establishment is carried out within fifteen months from the date of approval by the CSRC;

(III) the listing and trading of shares on an overseas stock exchange and the transfer of Domestic Shares into overseas listed foreign invested shares as prescribed in the Article 21 of the Articles of Association.

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8. BOARD OF DIRECTORS

(1) Directors

The directors shall be elected or replaced at the general meeting for a term of three years. A Director may serve consecutive terms if re-elected upon the expiry of his/her term.

Under the premise of complying with the relevant laws and administrative regulations, the general meeting may, in the ordinary resolution, remove any director whose term of office has not expired (but the damage claims of the director based on any contract is not affected by this rule).

A Director need not hold any shares in our Company.

(2) Board of Directors

The Company shall set up a board of directors which consists of nine directors, including a chairman and three independent directors (defined as those directors who are independent to the shareholders and don’t hold office in the Company), accounting for at least one third of the total number of Directors.

The board of directors is accountable to the general meetings and exercise the following functions and powers:

(I) to convene of general meetings and report its work to the general meetings;

(II) to implement resolutions of the general meetings;

(III) to decide on the Company’s business plans and investment plans;

(IV) to formulate the annual financial budgets and final accounts of the Company;

(V) to formulate the Company’s profit distribution plans and plans on making up losses;

(VI) to formulate the plans for the Company to increase or reduce its registered capital and issuance of corporate bonds;

(VII) to formulate plans for the Company’s merger, division or dissolution;

(VIII) to decide on establishment of internal management organizations of the Company;

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(IX) to engage or dismiss the Company’s general manager, to engage or dismiss vice general manager(s) and other senior management including the person in charge of finance of the Company in accordance with the nominations by general manager, and to decide on their remunerations;

(X) to formulate the basic management system of the Company;

(XI) to formulate proposals to amend these Articles of Association;

(XII) to formulate proposals to repurchase the Company’s shares under the situations stipulated in items (1) and (2) of Article 29 herein;

(XIII) to decide on the repurchase of the Company’s shares under the situations stipulated in items (3), (5) or (6) of Article 29 herein;

(XIV) to exercise other powers and duties conferred by laws, regulations, the listing rules of the exchange where our shares are listed, the Articles of Association or the general meetings.

Except for the Board resolutions in respect of the matters specified in paragraphs (VI), (VII), (XI) and (XIII) which shall be passed by more than two-thirds of the directors, the Board resolutions in respect of all other matters set out in the preceding paragraph may be passed by more than half of the directors.

Meetings of the board of directors may be held only if more than one half of the directors (including agents) are present.

Each director enjoys one voting right. The resolution of the Board of Directors shall be passed by more than a half of all directors, except as otherwise stipulated by the Articles of Association. In the event of equality of votes in favour or against a resolution, the chairman of the board of directors shall have an additional vote.

If any director is associated with the enterprises that are involved in the matters to be resolved at the meeting of the Board, he or she shall not exercise his or her voting rights for such matters, nor shall such director exercise voting rights on behalf of other directors. Such meeting of the Board may be held only if more than one half of the directors without a connected relationship are present, and the resolutions made at such a meeting of the Board shall be passed by more than one half of the directors without a connected relationship. If the number of non-connected directors present at such meeting is less than three, the matter shall be submitted to the general meeting for consideration.

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9. COMPANY SECRETARY OF THE BOARD

The Company shall have a secretary to the Board. The secretary to the Board shall be a member of the senior management of the Company.

The secretary to the Board of the Company shall be a natural person with the requisite professional knowledge and experience and shall be appointed by the Board. Any accountant from the accounting firm engaged by the Company shall not concurrently serve as the secretary to the Board of the Company.

10. SUPERVISORY COMMITTEE

The Company has a Supervisory Committee. The Supervisory Committee is composed of five members, one of whom acts as the chairman of the Supervisory Committee. The term of office for a Supervisor is 3 years, and the Supervisor may be reappointed at the expiry of the term of office. The appointment and removal of the Chairman of Supervisory Committee shall be by votes of two thirds or more of the Supervisors.

The Supervisory Committee shall consist of 3 shareholder representatives and 2 employee representative of the Company. The shareholder representatives shall be elected and removed by the shareholders’ general meetings and the employee representative shall be elected and removed by employees of the Company in a democratic way.

The Supervisory Committee shall be held accountable to the shareholders’ general meetings and perform the following functions and exercise its powers in accordance with the laws:

(I) to review the Company’s financial affairs;

(II) to supervise Directors, general manager and other senior management members on the violation of laws, administrative regulations or the Articles of Association in performing their duties to the Company;

(III) to demand rectification from Directors, manager and any other senior management members when the acts of such person(s) are harmful to the Company’s interest;

(IV) to examine the financial information such as the financial report, business report and plans for distribution of profits to be submitted by the Board to the shareholders’ general meetings and, should any queries arise, to engage, in the name of the Company, certified public accountants and practicing auditors to conduct a re-examination;

(V) to propose the convening of a special general meeting;

(VI) to deal with or take legal actions against Directors on behalf of the Company;

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(VII) to exercise other powers and duties conferred by laws, regulations, the listing rules of the exchange where our shares are listed, the Articles of Association or the general meetings.

All reasonable expenses incurred in respect of the employment of professionals such as lawyers, certified public accountants or practicing auditors as are required by the Supervisory Committee in discharging its duties shall be borne by the Company.

11. GENERAL MANAGER OF THE COMPANY

Our Company shall have one general manager, who shall be appointed and dismissed by the Board.

The Manager shall be accountable to the Board and exercise the following functions and powers:

(I) be in charge of the production and operation management of the Company, and to organize the enforcement of resolutions of the Board of Directors;

(II) organize the implementation of the annual operation plans and investment schemes of the Company;

(III) formulate the structure scheme of the internal management of the Company;

(IV) formulate the basic management system of the Company;

(V) formulate basic rules and regulations of the Company;

(VI) propose the appointment or dismissal of the deputy general manager and other senior management (including chief financial officer) of the Company;

(VII) appoint or dismiss responsible management personnel other than those required to be appointed or dismissed by the Board of Directors;

(VIII) other powers and duties authorized by the Articles of Association.

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12. FINANCE AND ACCOUNTING SYSTEM AND PROFIT DISTRIBUTION

The Company shall establish its financial and accounting system in accordance with relevant laws and administrative regulations, and PRC accounting standards formulated by the competent financial authorities under the State Council.

The Company shall prepare financial reports at the end of each fiscal year, and such reports shall be examined and verified according to laws.

The Company shall publish two financial reports in each fiscal year; the interim financial report shall be published within sixty days after the end of the first six months of each fiscal year; the annual financial report shall be published within one hundred and twenty days after the end of the fiscal year.

The financial report of the Company shall be kept at the Company and shall be made available to the Shareholders at least twenty-one days before the annual general meeting is held and within 4 months after the end of relevant financial year. Each Shareholder shall have the right to obtain the financial report mentioned in this chapter. The financial reports mentioned in the preceding paragraph shall include the report of the Board of Directors, the balance sheet (including the documents required to be attached by laws and administrative regulations of PRC or other countries and regions), profit and loss statement (the profit statement) or the statement of income and expense (the statement of cash flow), or (without violating relevant PRC laws) the summary financial report approved by the Stock Exchange. The Company shall send the aforesaid reports to each of the holders of overseas listed foreign shares to their addresses as recorded in the share register of the Company by postage-paid mail. The Company may also do the same by announcement (including through the Company’s website) in accordance with the laws, administrative regulations, department rules and relevant regulations of the securities regulatory authority of the place where the Company’s shares are listed.

The financial statements of the Company shall be prepared in accordance with the PRC accounting standards and regulations as well as the international accounting standards or the accounting standards of the overseas area in which the shares are listed. If there are any material differences between the financial statements prepared in accordance with the two accounting standards, such differences shall be stated in the notes to the financial statements.

The Company shall, when distributing its after-tax profits of the year, withdraw ten percent of the profits into the Company’s statutory reserve fund. The Company may not withdraw a statutory reserve fund if the cumulative amount has reached fifty percent or more of the Company’s registered capital. If the Company’s statutory reserve fund could not cover the losses of the previous year, profit of the year shall be used to cover the losses before withdrawing, according to the foregoing provision, the statutory reserve fund.

After the Company has withdrawn the statutory reserve fund from the after-tax profits, the Company may also withdraw discretionary reserve fund from the after-tax profits upon the approval of the general meeting.

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After the Company has made up our losses and made allocations to our reserve fund, the remaining profits are distributed in proportion to the number of shares held by the shareholders. Where the general meeting distributes profits to Shareholders before losses have been covered and the statutory reserve fund has been allocated, which is in violation of the foregoing provision, the Shareholders concerned shall refund to the Company the profits distributed in violation of the foregoing provision.

The shares of the Company held by the Company shall not be subject to profit distribution.

The Company shall appoint collection agents for holders of overseas listed shares. The collection agents shall, on behalf of the related Shareholders and collect distributed dividends and other payables by the Company for the overseas listed foreign shares so as to make a payment for related Shareholders.

The collection agents appointed by the Company shall satisfy requirements provided under the laws or the relevant provisions of the stock exchange at the place where the shares of the Company are listed. The collection agents appointed by the Company for overseas listed shares listed in Stock Exchange shall be a trust company registered under the Trustee Ordinance of Hong Kong.

As for unclaimed dividends, in compliance with the laws, regulations of PRC, the Company may exercise the right of confiscation, but it shall not be exercised until the expiry of the applicable validity period.

The Company shall have the right to stop sending dividend coupons by post to a holder of overseas listed foreign shares when the dividend coupons are not cashed for two consecutive times.

However, the Company may also exercise such a right when the dividend coupons are returned after they are sent to the addressee for the first time.

The Company may sell the shares held by a holder of overseas listed foreign shares who is untraceable in such ways as the Board of Directors thinks fit, provided that the following conditions shall be complied with:

(I) at least three dividends have been distributed in respect of such shares during the period of 12 years, and no dividend has been claimed by the shareholder during that period; and

(II) upon the expiry of the 12-year period, the Company shall make an announcement in one or more newspapers at the place where the Company lists stating the Company’s intention to sell the shares, and notify the Stock Exchange of such intention.

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13. DISSOLUTION AND LIQUIDATION OF THE COMPANY

The Company shall be dissolved and liquidated according to laws in any of the following circumstances:

(I) the general meeting resolves to dissolve the Company;

(II) dissolution is necessary as a result of the merger or division of the Company;

(III) the Company is legally declared bankrupt because it is unable to pay its debts as they fall due;

(IV) the Company is ordered to close down in violation of laws and administrative regulations;

(V) the business term expires.

Where the Company is dissolved according to the provisions of sub-paragraphs (I) and (V) of the preceding Article, it shall establish a liquidation committee within 15 days and the composition of the liquidation committee shall be determined by way of ordinary resolution at a general meeting. If the Company fails to establish the liquidation committee and carry out the liquidation within the time limit, its creditors may petition a People’s Court to designate relevant persons to form a liquidation committee and carry out the liquidation.

If the Company is to be dissolved pursuant to item (III) of the preceding Article, the People’s Court shall, in accordance with the provisions of relevant laws, arrange for the shareholders, the relevant authority and relevant professionals to establish a liquidation committee to carry out liquidation.

If the Company is to be dissolved pursuant to item (IV) of the preceding Article, the relevant competent authority shall arrange for the shareholders, relevant authorities and relevant professionals to establish a liquidation committee to carry out liquidation.

If the Board decides that the Company shall be liquidated (except for the liquidation as a result of the Company’s declaration of bankruptcy), the notice of the general meeting convened for such purpose shall include a statement to the effect that the Board has made full inquiry into the position of the Company and that the Board is of the opinion that the Company can pay its debts in full within 12 months after the commencement of the liquidation. The functions and powers of the Board of the Company shall terminate immediately after the general meeting has passed the resolution to carry out liquidation.

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The liquidation committee shall take instructions from the general meeting and shall make a report to the general meeting on the committee’s income and expenditure as well as the business of the Company and the progress of the liquidation at least annually. It shall make a final report to the general meeting when the liquidation is completed. The liquidation committee shall notify creditors within 10 days of its establishment, and make at least three announcements on the newspapers within 60 days of its establishment. Claims shall be registered by the liquidation committee. Creditors shall declare their claims to the liquidation committee within 30 days from the date of receipt of the written notice or, if they did not receive a written notice, within 45 days from the date of the announcement. When declaring their claims, creditors shall explain the particulars relevant to their claims and submit supporting documentation.

After the liquidation committee has liquidated the Company’s property and prepared a balance sheet and property list, it shall formulate a liquidation plan and submit such plan to the general meeting or relevant competent authority for confirmation. The Company’s assets shall be used to settle its debts in the following order and sequence: to pay the liquidation expenses, the wages, social insurance premiums and statutory compensation of the employees, the taxes owed and to settle the debts of the Company. The residual assets after the settlement made according to the preceding Article shall be distributed to the shareholders on the basis of the class of shares and in the proportion of shares being held. During the liquidation period, the Company shall not commence any new business activity.

Where the Company is liquidated due to dissolution, if the liquidation committee, after the liquidation of the assets of the Company and preparation of the balance sheet and property list, discovers that the assets of the Company are insufficient to settle the debts, it shall forthwith make an application to the People’s Court for a declaration of insolvency. After the People’s Court has ruled to declare the Company bankrupt, the liquidation committee shall turn over the liquidation matters to the People’s Court.

Following the completion of liquidation of the Company, the liquidation committee shall formulate a liquidation report, a revenue and expenditure statement and financial accounts in respect of the liquidation period and, after verification thereof by a certified public accountant registered in China, submit the same to the general meeting or the relevant competent authority for confirmation.

Within 30 days from the date of the general meeting’s or the relevant competent authority’s confirmation, the liquidation committee shall submit the aforementioned documents to the company registration authority to apply for company deregistration, and announce the Company’s termination.

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14. AMENDMENT PROCEDURE TO THE ARTICLES OF ASSOCIATION

The Company shall amend the Articles of Association in accordance with the laws, administrative regulations and the Articles of Association. The amendments to the Articles of Association which involves contents of the Mandatory Provisions of Articles of Association of Companies That List Overseas shall require the approval from the vetting authority authorized by the State Council and CSRC to become effective. If an amendment to the Articles of Association involves a registered particular of the Company, registration of the change shall be carried out in accordance with the law.

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A. FURTHER INFORMATION ABOUT OUR GROUP

1. Establishment of our Company

Our Company was established in the PRC on April 1, 1993 and was converted to a joint stock company with limited liability under the Company Law with effect from June 5, 2003.

Our Company has established a place of business in Hong Kong at 40th Floor, Dah Sing Financial Centre, 248 Queen’s Road East, Wanchai, Hong Kong, and was registered as a non-Hong Kong company in Hong Kong under Part 16 of the Companies Ordinance on [●]. Ms Chan Yin Wah has been appointed as our agent for the acceptance of service of process and notices on behalf of our Company in Hong Kong.

As we are established in the PRC, our corporate structure and Articles of Association are subject to the relevant laws and regulations of the PRC. A summary of the relevant provisions of our Articles of Association is set out in Appendix VI to this document. A summary of certain relevant aspects of the laws and regulations of the PRC is set out in Appendix V to this document.

2. Changes in the share capital of our Company

As of the date of our establishment, our registered capital was RMB1,000,000 which was fully paid up.

On December 30, 1996, our registered capital was increased from RMB1,000,000 to RMB4,500,000.

On March 16, 1999, our registered capital was further increased from RMB4,500,000 to RMB8,000,000.

On June 5, 2003, our Company was converted into a joint stock company with limited liability under the PRC Company Law. Upon completion of such conversation, the registered capital of our Company was RMB15,000,000.00 divided into 15,000,000 Shares with a nominal value of RMB1.00 each.

On September 27, 2008, our registered share capital was increased from RMB15,000,000 to RMB24,000,000.

On April 9, 2009, our registered share capital was increased from RMB24,000,000 to RMB50,400,000.

On October 12, 2010, our registered share capital was increased from RMB50,400,000 to RMB60,480,000.

On July 7, 2011, our registered share capital was increased from RMB60,480,000 to RMB87,696,000.

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On August 14, 2012, our registered share capital was increased from RMB87,696,000 to RMB 131,544,000.

On September 28, 2015, our registered share capital was decreased from RMB131,544,000 to RMB81,544,000.

On January 29, 2016, our registered share capital was increased from RMB81,544,000 to RMB111,307,559.

On December 25, 2017, our registered share capital was decreased from RMB111,307,559 to RMB81,544,000.

On May 8, 2021, our registered share capital was increased from RMB81,544,000 to RMB87,212,834.

Assuming the [REDACTED] is not exercised, upon completion of the [REDACTED], our registered capital will be increased to RMB[REDACTED], made up of [REDACTED] H Shares fully paid up or credited as fully paid up, representing 100% of our share capital. Save as aforesaid, there has been no alteration in our registered capital since our establishment.

3. Restriction of share repurchase

For details of the restrictions on the share repurchase by our Company, please refer to “Summary of the Articles of Association” in Appendix VI to this document.

4. Resolutions of our Shareholders passed at our Company’s extraordinary general meeting held on May 10, 2021

At the extraordinary general meeting of our Company held on May 10, 2021, among other things, the following resolutions were passed by the Shareholders:

(a) the issue by our H Shares with a nominal value of RMB1.00 each and such H Shares to be [REDACTED] on the Stock Exchange;

(b) subject to the completion of the [REDACTED], the Articles of Association has been approved and adopted, which shall only become effective on the [REDACTED], and our Board has been authorized to amend the Articles of Association in accordance with any comments from the Stock Exchange and the relevant PRC regulatory authorities; and

(c) authorizing our Board to handle all relevant matters relating to, among other things, the implementation of issue of H Shares and the [REDACTED].

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5. Corporate reorganization

We underwent the reorganization, for details, please see “History, Reorganization and Corporate Structure”. As confirmed by our PRC Legal Advisor, all the equity transfers and capital increases as described in “—Reorganization” and “—Pre-[REDACTED] Investment” in the section headed “History, Reorganization and Corporate Structure” were properly and legally completed and all necessary approvals, filings and registrations from the relevant PRC authorities have been obtained and completed.

6. Particulars of our subsidiaries

Set out below is certain information of our subsidiaries as of the Latest Practicable Date:

Approximate Identity of percentage of the No. Name of subsidiary shareholder(s) (1) equity interests

1. Yiying Community Technology Group Our Company 100.00% 2. Shenzhen Yiying Technology Co., Ltd. Yiying Community 80.00% (深圳市一應科技有限公司) Technology Group (“Yiying Technology”) Nanjing Landi 20.00% Information Technology Co., Ltd. (南京覽笛信息科技有限公司) 3. Shenzhen Yiying Catering Management Co., Yiying Community 100.00% Ltd. (深圳市一應餐飲管理有限公司) Technology Group (“Yiying Catering”) 4. Shenzhen Wandou Home Co., Ltd. Yiying Community 100.00% (深圳市豌豆家居有限公司) Technology Group (“Wandou Home”) 5. Shenzhen Shenchangcheng Our Company 100.00% 6. Jiangxi Shenchangcheng Property Shenzhen 100.00% Management Co., Ltd. Shenchangcheng (江西深長城物業管理有限公司) 7. Xi’an Shenchangcheng Property Shenzhen 100.00% Services Co., Ltd. Shenchangcheng (西安深長城物業服務有限公司) 8. Beijing Shenchangcheng Property Shenzhen 100.00% Management Co., Ltd. Shenchangcheng (北京深長城物業管理有限公司) (“Beijing Shenchangcheng”)

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Approximate Identity of percentage of the No. Name of subsidiary shareholder(s) (1) equity interests

9. Beijing Changcheng Kangjian Property Beijing Shenchangcheng 51.00% Management Co., Ltd. Beijing Kangjian 49.00% (北京長城康健物業管理有限責任公司) Baosheng Commercial Management Co., Ltd. (北京康健寶盛商業管理有限責任公司) 10. Qian’an Xicheng Property Services Co., Ltd. Shenzhen 100.00% (遷安熙城物業服務有限公司) Shenchangcheng 11. Chongqing Shenchangcheng Property Shenzhen 100.00% Services Co., Ltd. Shenchangcheng (重慶深長城物業服務有限公司) 12. Fuzhou Shenchangcheng Property Shenzhen 100.00% Management Co., Ltd. Shenchangcheng (福州深長城物業管理有限公司) 13. Chengdu Shenchangcheng Property Shenzhen 100.00% Management Co., Ltd. Shenchangcheng (成都深長城物業管理有限公司) (“Chengdu Shenchangcheng”) 14. Shanghai Shenchangcheng Property Shenzhen 100.00% Management Co., Ltd. Shenchangcheng (上海深長城物業管理有限公司) (“Shanghai Shenchangcheng”) 15. Tianjin Shenchangcheng Property Shenzhen 100.00% Services Co., Ltd. Shenchangcheng (天津深長城物業服務有限公司) 16. Hunan Xicheng Property Shenzhen 100.00% Management Co., Ltd. Shenchangcheng (湖南熙城物業管理有限公司) 17. Jiangsu Shenchangcheng Property Shenzhen 100.00% Management Co., Ltd. Shenchangcheng (江蘇深長城物業管理有限公司) 18. Tianjin Shenchangcheng Ruishang Property Shenzhen 100.00% Services Co., Ltd. Shenchangcheng (天津深長城睿商物業服務有限責任公司) 19. Inner Mongolia Changcheng Property Shenzhen 100.00% Services Co., Ltd. Shenchangcheng (內蒙古長城物業服務有限公司) (“Inner Mongolia Changcheng”)

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Approximate Identity of percentage of the No. Name of subsidiary shareholder(s) (1) equity interests

20. Wuhan Shenchangcheng Property Shenzhen 100.00% Management Co., Ltd. Shenchangcheng (武漢深長城物業管理有限公司) 21. Changcheng Louyu Technology Our Company 100.00% 22. Beijing Shenchangcheng Heating Changcheng Louyu 100.00% Services Co., Ltd. Technology (北京深長城供暖服務有限公司) 23. Shenzhen Yiying Louyu Technology Changcheng Louyu 100.00% Co., Ltd. (深圳市一應樓宇科技有限公司) Technology 24. Changcheng Elevator Our Company 100.00% 25. Tianjin Yiying Elevator Technology Co., Ltd. Changcheng Elevator 100.00% (天津一應電梯科技有限公司) 26. Beijing Shiji Tujie Elevator System Changcheng Elevator 70.00% Engineering Technology Co., Ltd. Wang Jun 30.00% (北京世紀圖捷電梯系統工程技術有限公司) 27. Shenzhen Ruishang Commercial Operation Our Company 100.00% Management Co., Ltd. (深圳市睿商商業經營管理有限公司) (“Shenzhen Ruishang”) 28. Foshan Shunde Chengjiruishang Property Shenzhen Ruishang 100.00% Management Co., Ltd. (佛山市順德區城基睿商物業管理有限公司) 29. Foshan Shunde Ruishang Commercial Plaza Shenzhen Ruishang 100.00% Management Co., Ltd. (佛山市順德區睿商商業廣場管理有限公司) 30. Shenzhen Changcheng Parking Lot Our Company 100.00% Management and Construction Co., Ltd. (深圳市長城停車場管理建設有限公司) 31. Fuzhou Fuhui Property Management Our Company 70.00% Co., Ltd. (福州福匯物業管理有限公司) Mingcheng Property 30.00% (Fujian) Co., Ltd. (名城地產（福建）有限公司) 32. Nanjing Langcheng Property Our Company 60.00% Management Co., Ltd. Nanjing Chuangte 40.00% (南京朗城物業管理有限公司) Property Management Co., Ltd. (南京創特物業管理有限公司)

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Approximate Identity of percentage of the No. Name of subsidiary shareholder(s) (1) equity interests

33. Shenzhen Shenchangcheng Community Our Company 100.00% Commercial Operation Co., Ltd. (深圳市深長城社區商業經營有限公司) 34. Benxi Xicheng Property Management Our Company 100.00% Co., Ltd. (本溪熙城物業管理有限公司) 35. Wuhu Xinde Property Management Our Company 100.00% Co., Ltd. (蕪湖信德物業管理有限公司) 36. Jiujiang Guojin Property Services Co., Ltd. Our Company 51.00% (九江國金物業服務有限公司) Jiujiang Jiangjuxin 49.00% Property Services Co., Ltd. (九江江聚信物業服務有限公司) 37. Yidu Shenchangcheng Property Shanghai 100.00% Management Co., Ltd. Shenchangcheng (宜都市深長城物業管理有限公司) 38. Gansu Aoge Property Management Co., Ltd. Chengdu 100.00% (甘肅奧格物業管理有限責任公司) Shenchangcheng 39. Hefei Shenchangcheng Property Services Shenzhen 100.00% Co., Ltd. (合肥深長城物業服務有限公司) Shenchangcheng 40. Mianyang Shenchangcheng Property Shenzhen 100.00% Services Co., Ltd. Shenchangcheng (綿陽深長城物業服務有限公司) (“Mianyang Shenchangcheng”) 41. Guangyuan Ruixin Property Services Co., Mianyang 100.00% Ltd. (廣元市瑞鑫物業服務有限公司) Shenchangcheng 42. Ruizhou Weining Changqi Property Shenzhen 100.00% Management Co., Ltd. Shenchangcheng (貴州威寧長麒物業管理有限公司) 43. Shanghai Yiying Youxuan Trading Co., Ltd. Shanghai 100.00% (上海一應優選商貿有限公司) Shenchangcheng 44. Xi’an Yiying Qingteng Catering Yiying Catering 100.00% Management Co., Ltd. (西安一應青藤餐飲管理有限公司) 45. Jiangsu Chaozhihui Information Technology Yiying Technology 100.00% Co., Ltd. (江蘇超智慧信息科技有限公司) 46. Changsha Yiying Whole Home Co., Ltd. Wandou Home 100.00% (長沙一應整體家居有限公司)

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Approximate Identity of percentage of the No. Name of subsidiary shareholder(s) (1) equity interests

47. Wuhan Yingjia Decoration Engineering Co., Wandou Home 100.00% Ltd. (武漢應家裝飾工程有限公司) 48. Hohhot Wandou Home Co., Ltd. Wandou Home 100.00% (呼和浩特市豌豆家居有限公司) 49. Shaanxi Laiyiying Decoration Engineering Wandou Home 100.00% Co., Ltd. (陝西來一應裝飾工程有限公司) 50. Shanghai Jiaying Home Co., Ltd. Wandou Home 100.00% (上海家應家居有限公司) 51. Shenzhen Yuebang Technology Services Co., Changcheng Louyu 100.00% Ltd. (深圳市悅幫科技服務有限公司) Technology 52. Fuzhou Yiying Elevator Technology Co., Changcheng Elevator 100.00% Ltd. (福州一應電梯科技有限公司) 53. Ningxia Hengshengkang Louyu Changcheng Elevator 100.00% Equipment Co., Ltd. (寧夏恆乘康樓宇設備有限公司) 54. Rizhao Yanshen Changcheng Property Our Company 100.00% Services Co., Ltd. (日照兗申長城物業服務有限公司) 55. Shenzhen Changteng Technology Co., Ltd. Yiying Community 70.00% (深圳市長藤科技有限公司) Technology Group Shenzhen Gemeite 30.00% Technology Co., Ltd. (深圳市格美特科技有限公司) 56. Shenzhen Chaozhihui Information Yiying Technology 60.00% Technology Co., Ltd. Yiying Community 40.00% (深圳市超智慧信息科技有限公司) Technology Group 57. Zhangjiakou Huicheng Property Services Our Company 60.00% Co., Ltd. (張家口惠誠物業服務有限公司) Zhangjiakou Huibang 40.00% Property Services Co., Ltd. (張家口市惠邦物業服務有限公司) 58. Shenzhen Shenchangcheng Property Shenzhen 55.00% Operations and Management Co., Ltd. Shenchangcheng (深圳市深長城物業經營管理有限公司) Shenzhen Chaojiqi 45.00% Technology Co., Ltd. (深圳市超級柒科技有限公司)

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Approximate Identity of percentage of the No. Name of subsidiary shareholder(s) (1) equity interests

59. Yiying Decoration (Beijing) Co., Ltd. Wandou Home 60.00% (一應裝飾（北京）有限公司) Womenjia Network 40.00% Technology (Beijing) Co., Ltd. (我們家網絡科技（北京）有限公司) 60. Shenzhen Zhongzhouxian Supply Chain Yiying Community 70.00% Services Co., Ltd. (深圳市中軸線供應鏈 Technology Group 服務有限公司) Shen Liubin (沈柳斌) 17.40% Xu Wei (徐蔚) 6.30% Guo Qing (郭慶) 6.30% 61. Shenzhen Tiancheng Environmental Services Our Company 60.00% Co., Ltd. (深圳市天城環境服務有限公司) Shenzhen Changcheng 40.00% Environmental Engineering Co., Ltd. (深圳市長城環境工程有限公司) 62. Tianjin Changcheng Jiahe Catering Services Our Company 51.00% Co., Ltd. (天津長城佳合餐飲服務有限公司) Tianjin Yijiayajie 49.00% Property Management Co., Ltd. (天津市伊佳雅潔物業管理有限公司) 63. Changcheng (Xiangtan) Property Our Company 51.00% Management Co., Ltd. Xiangtan Community 49.00% (長城（湘潭）物業管理有限公司) Services Group Co., Ltd. (湘潭社區服務集團有限公司) 64. Foshan Chengjiruishang Our Company 100.00% 65. Cangzhou Changcheng Jiantou Property Our Company 60.00% Services Co., Ltd. Cangzhou Jiantou 40.00% (滄州長城建投物業服務有限公司) Property Services Co., Ltd. (滄州建投物業服務有限公司) 66. Chenzhou Shenchangcheng Property Our Company 60.00% Services Co., Ltd. Chenzhou Fuze Property 40.00% (郴州深長城物業服務有限公司) Services Co., Ltd (郴州福澤物業服務有限公司) 67. Xiamen Zhucheng Property Management Our Company 60.00% Co., Ltd. (廈門築成物業管理有限公司) Guomao Property Group 40.00% Co., Ltd. (國貿地產集團有限公司)

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Approximate Identity of percentage of the No. Name of subsidiary shareholder(s) (1) equity interests

68. Fuyang Langcheng Property Management Our Company 70.00% Co., Ltd. (阜陽朗城物業管理有限公司) Shenzhen Xingbao 30.00% Property Development Co., Ltd. (深圳市興寶物業發展有限公司) 69. Changcheng (Xiamen) Property Our Company 60.00% Management Co., Ltd. (長城（廈門）物業管 Xiamen Xiangtou Real 40.00% 理有限公司) Estate Group Co., Ltd. (廈門翔投置業集團有限公司) 70. Xiangxi Changshen Property Management Our Company 51.00% Co., Ltd. (湘西長神物業管理有限公司) Xiangxi Shenzhou 49.00% Cultural Tourism Development Co., Ltd. (湘西神舟文化旅游發展有限公司) 71. Guang’an Changcheng Jiahe Property Our Company 51.00% Management Co., Ltd. Guang’an Jiahe Property 49.00% (廣安市長城佳和物業管理有限公司) Management Co., Ltd. (廣安佳和物業管理有限公司) 72. Wuhan Changcheng Yaoheng Commercial Our Company 51.00% Management Co., Ltd. Wuhan Yaoheng 49.00% (武漢長城耀恒商業管理有限公司) Property Management Co., Ltd. (武漢耀恒物業管理有限公司) 73. Suzhou Zhihuibang Industry Park Our Company 51.00% Management Co., Ltd. Suzhou Nano 49.00% (蘇州智匯邦產業園管理有限公司) Technology Development Co., Ltd. (蘇州納米科技發展有限公司) 74. Changcheng Zhonggao (Liaoning) Property Our Company 51.00% Services Co., Ltd. (長城中高 (遼寧) 物業服 Beijing Zhonggao 49.00% 務有限公司) Investment Group Co., Ltd. (北京中高投資集團有限公司)

Note:

(1) To the best of our knowledge, information and belief, having made all reasonable enquiries, each of the shareholders of our non-wholly owned subsidiaries (other than the members of our Group) was an Independent Third Party save for their respective equity interests in the relevant subsidiaries of our Group as of the Latest Practicable Date.

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7. Change in the registered capital of subsidiaries

Save for the subsidiaries mentioned in the Accountant’s Report and the paragraph headed “6. Particulars of our subsidiaries” in this section, our Company has no other subsidiaries.

The following changes in the registered capital of our subsidiaries have taken place within the two years immediately preceding the date of this document:

On September 27, 2019, the registered capital of Yiying Technology was increased from RMB10,000,000 to RMB12,500,000.

On November 22, 2019, the registered capital of Shenzhen Zhongzhouxian Supply Chain Services Co., Ltd. (深圳市中軸綫供應鏈服務有限公司) was increased from RMB1,010,000 to RMB2,525,000.

On March 19, 2021, the registered capital of Changcheng Elevator was increased from RMB5,000,000 to RMB15,000,000.

On May 15, 2020, the registered capital of Beijing Shiji Tujie Elevator System Engineering Technology Co., Ltd. (北京世紀圖捷電梯系統工程技術有限公司) was increased from RMB3,500,306 to RMB5,320,306.

Save as set out above, there has been no alteration in the registered capital of any of our subsidiaries within the two years immediately preceding the date of this document.

B. FURTHER INFORMATION ABOUT OUR BUSINESS

1. Summary of material contracts

We have entered into the following contracts (not being contracts entered into in the ordinary course of business) within the two years preceding the date of this document that are or may be material:

(a) An equity transfer agreement dated March 25, 2021 entered into between Shenzhen Jiaye Investment Holdings Co., Ltd. (深圳市嘉業投資控股有限公司) and our Company, pursuant to which our Company agreed to acquire the 100% equity interest in Foshan Shunde Chengjiruishang Commercial Operation Management Co., Ltd. (佛山市順德區城基睿商商業運營管理有限公司) from Shenzhen Jiaye Investment Holdings Co., Ltd. (深圳市嘉業投資控股有限公司) at a consideration of RMB109,256,000;

(b) the Deed of Non-competition;

(d) the [REDACTED].

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2. Intellectual property rights of our Group

(a) Trademarks

As of the Latest Practicable Date, our Group had registered the following trademarks which, in the opinion of our Directors, are material to our business:

Name of Registration Registered Place of Date of Expiry No. Trademark Number Class Proprietor Registration Registration Date

1. 7274597 36 Our Company PRC October 7, 2010 October 6, 2030

2. 7274601 44 Our Company PRC September 28, 2020 September 27, 2030

3. 7274621 37 Our Company PRC February 28, 2011 February 27, 2031

4. 14058047 35 Yiying Community PRC March 28, 2015 March 27, 2025 Technology Group

5. 48843107 37 Shenzhen Yiying PRC April 14, 2021 April 13, 2031 Technology Co., Ltd. (深圳市一應科技有限公司)

6. 46605802 9 Changcheng Louyu PRC April 21, 2021 April 20, 2031 Technology

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(b) Copyrights

As of the Latest Practicable Date, our Group had registered the following software copyrights in the PRC which, in the opinion of our Directors, are material to our business:

Registration Date of No. Copyright Number Copyright Owner Date of Publication Registration Status

1. A commercial system for 2016SR305005 Our Company August 4, 2016 October 25, 2016 Valid community business (社區商務系統) 2. A charing management system 2016SR295271 Our Company December 23, 2015 October 17, 2016 Valid (收費管理系統) 3. A customer service system 2016SR295079 Our Company March 23, 2016 October 17, 2016 Valid (客戶服務系統) 4. A system for purchasing, sales and 2016SR295083 Our Company June 30, 2016 October 17, 2016 Valid inventory (進銷存系統) 5. An exclusive housekeeper platform 2016SR304997 Our Company August 2, 2016 October 25, 2016 Valid (專屬管家平台)

As of the Latest Practicable Date, our Group had registered the following of patents in the PRC which, in the opinion of our Directors, are material to our business:

Place of Date of No. Patent Type Patent Number Registered Owner Registration Application Status

1. A device of power supply link for Utility model ZL202020935029.X Our Company PRC May 28, 2020 Valid power system substation maintenance (一種電力系統變電維護供電連接裝置) 2. A comprehensive monitoring Utility model ZL202021296145.8 Our Company PRC July 6, 2020 Valid device for public facilities (一種公共設施綜合安全監控裝置) 3. A device of trunk protection for Utility model ZL202020440840.0 Our Company PRC March 31, 2020 Valid municipal garden greening (一種市政園林綠化樹幹防護裝置) 4. A device of irrigation for garden Utility model ZL202020302121.2 Our Company PRC March 12, 2020 Valid greening (一種園林綠化用灌溉裝置) 5. A device of fire warning for smart Utility model ZL202020955845.7 Our Company PRC May 31, 2020 Valid building (一種智能樓宇用消防警示裝置)

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(d) Domain name

As of the Latest Practicable Date, our Group had registered the following domain name in the PRC which, in the opinion of our Directors, is material to our business:

Date of No. Domain Name Name of Registered Proprietor Registration Expiry Date

1. www.cc-pg.cn Yiying Community Technology Group January 12, January 12, 2009 2024

C. FURTHER INFORMATION ABOUT DIRECTORS, SUPERVISORS AND SUBSTANTIAL SHAREHOLDERS

1. Disclosure of interests

(a) Interests and short positions of the Directors, Supervisors and the chief executive of our Company in the registered capital of our Company and its associated corporations

Immediately following the completion of the [REDACTED] and assuming that the [REDACTED] is not exercised, the interests or short positions of Directors, Supervisors and chief executive of our Company in the Shares, underlying Shares and debentures of our Company or its associated corporations (within the meaning of Part XV of the SFO) which will be required to be notified to our Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests or short positions which they were taken or deemed to have under such provisions of the SFO) or which will be required, under Section 352 of the SFO, to be entered in the register referred to in that section, or which will be required, under the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix 10 to the Listing Rules (the “Model Code”), to be notified to our Company once the H Shares are [REDACTED] will be as follows:

Interest in associated corporations of our Company

Name of Percentage associated holding Name corporation Nature of Interest Interest in shares(1) (approximately)

Mr. Chen Yaozhong Xicheng Ruihe Interest in a controlled 16,135,468 Shares (L) 100% Xicheng Rui’an corporation 5,668,834 Shares (L) 100%

Mr. Liang Zhijun Xicheng Ruifeng Interest in a controlled 10,335,260 Shares (L) 100% corporation

Mr. Lv Yuhua Xicheng Ruiying Interest in a controlled 7,805,677 Shares (L) 100% corporation

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Name of Percentage associated holding Name corporation Nature of Interest Interest in shares(1) (approximately)

Mr. Ma Xingwen Xicheng Ruijia Interest in a controlled 18,052,152 Shares (L) 100% corporation

Note:

(1) The letter “L” denotes the person’s long position in the shares.

(b) Substantial Shareholders

(i) Interests of the substantial Shareholders in the Shares

Save as disclosed in the section headed “Substantial Shareholders” in this document, our Directors are not aware of any person (other than our Director, Supervisors or chief executive of our Company) who will, immediately following completion of the [REDACTED] (assuming that the [REDACTED] is not exercised), have interests or short positions in our Shares or underlying Shares which would be required to be disclosed to us and the Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO, or who is, directly or indirectly, interested in 10% or more of the issued voting shares of our Company.

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(ii) Interests of the substantial Shareholders of other members of our Group

As of the Latest Practicable Date, so far as our Directors are aware, the following persons (other than our Directors, Supervisors or chief executive of our Company) were Independent Third Parties, save for their respective interests in 10% or more of the nominal value of any class of registered capital carrying rights to vote in all circumstances at general meetings of other member of our Group:

Approximate percentage of Name of members of our Group Name of Shareholder shareholding

Yiying Technology Nanjing Landi 20.00% Information Technology Co., Ltd. (南京覽笛信息科技有限公司) Beijing Changcheng Kangjian Property Beijing Kangjian 49.00% Management Co., Ltd. Baosheng Commercial (北京長城康健物業管理有限責任公司) Management Co., Ltd. (北京康健寶盛商業管理有限責任公司) Beijing Shiji Tujie Elevator System Wang Jun 30.00% Engineering Technology Co., Ltd. (北京世紀圖捷電梯系統工程技術有限公司) Fuzhou Fuhui Property Management Co., Mingcheng Property 30.00% Ltd. (福州福匯物業管理有限公司) (Fujian) Co., Ltd. (名城地產（福建）有限公司) Nanjing Langcheng Property Nanjing Chuangte 40.00% Management Co., Ltd. Property Management (南京朗城物業管理有限公司) Co.,Ltd.(南京創特物業管理有限公司) Jiujiang Guojin Property Services Co., Jiujiang Jiangjuxin 49.00% Ltd. (九江國金物業服務有限公司) Property Services Co., Ltd. (九江江聚信物業服務有限公司) Shenzhen Changteng Technology Co., Shenzhen Gemeite 30.00% Ltd. (深圳市長藤科技有限公司) Technology Co., Ltd. (深圳市格美特科技有限公司)

– VII-15 – THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. APPENDIX VII STATUTORY AND GENERAL INFORMATION

Approximate percentage of Name of members of our Group Name of Shareholder shareholding

Zhangjiakou Huicheng Property Services Zhangjiakou Huibang 40.00% Co., Ltd. (張家口惠誠物業服務有限公司) Property Services Co., Ltd. (張家口市惠邦物業服務有限公司) Shenzhen Shenchangcheng Property Shenzhen Chaojiqi 45.00% Operations and Management Co., Ltd. Technology Co., Ltd. (深圳市深長城物業經營管理有限公司) (深圳市超級柒科技有限公司) Yiying Decoration (Beijing) Co., Ltd. Womenjia Network 40.00% (一應裝飾（北京）有限公司) Technology (Beijing) Co., Ltd. (我們家網絡科技（北京）有限公司) Shenzhen Zhongzhouxian Supply Chain Shen Liubin (沈柳斌) 17.40% Services Co., Ltd. Xu Wei (徐蔚) 6.30% (深圳市中軸線供應鏈服務有限公司) Guo Qing (郭慶) 6.30% Shenzhen Tiancheng Environmental Shenzhen Changcheng 40.00% Services Co., Ltd. Environmental (深圳市天城環境服務有限公司) Engineering Co., Ltd. (深圳市長城環境工程有限公司) Tianjin Changcheng Jiahe Catering Tianjin Yijiayajie 49.00% Services Co., Ltd. Property Management (天津長城佳合餐飲服務有限公司) Co., Ltd. (天津市伊佳雅潔物業管理有限公司) Changcheng (Xiangtan) Property Xiangtan Community 49.00% Management Co., Ltd. Services Group Co., (長城（湘潭）物業管理有限公司) Ltd. (湘潭社區服務集團有限公司) Cangzhou Changcheng Jiantou Property Cangzhou Jiantou 40.00% Services Co., Ltd. Property Services Co., (滄州長城建投物業服務有限公司) Ltd. (滄州建投物業服務有限公司) Chenzhou Shenchangcheng Property Chenzhou Fuze Property 40.00% Services Co., Ltd. (郴州深長城物業服務 Services Co., Ltd. (郴州有限公司) 福澤物業服務有限公司)

– VII-16 – THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. APPENDIX VII STATUTORY AND GENERAL INFORMATION

Approximate percentage of Name of members of our Group Name of Shareholder shareholding

Xiamen Zhucheng Property Management Guomao Property Group 40.00% Co., Ltd. (廈門築成物業管理有限公司) Co.,Ltd.(國貿地產集團有限公司) Fuyang Langcheng Property Management Shenzhen Xingbao 30.00% Co., Ltd. (阜陽朗城物業管理有限公司) Property Development Co.,Ltd.(深圳市興寶物業發展有限公司) Changcheng (Xiamen) Property Xiamen Xiangtou Real 40.00% Management Co., Ltd. Estate Group Co., Ltd. (長城（廈門）物業管理有限公司) (廈門翔投置業集團有限公司) Xiangxi Changshen Property Xiangxi Shenzhou 49.00% Management Co., Ltd. Cultural Tourism (湘西長神物業管理有限公司) Development Co., Ltd. (湘西神舟文化旅游發展有限公司) Guang’an Changcheng Jiahe Property Guang’an Jiahe Property 49.00% Management Co., Ltd. Management Co., Ltd. (廣安市長城佳和物業管理有限公司) (廣安佳和物業管理有限公司) Wuhan Changcheng Yaoheng Commercial Wuhan Yaoheng 49.00% Management Co., Ltd. Property Management (武漢長城耀恒商業管理有限公司) Co.,Ltd.(武漢耀恒物業管理有限公司) Suzhou Zhihuibang Industry Park Suzhou Nano 49.00% Management Co., Ltd. Technology (蘇州智匯邦產業園管理有限公司) Development Co., Ltd. (蘇州納米科技發展有限公司) Changcheng Zhonggao (Liaoning) Beijing Zhonggao 49.00% Property Services Co., Ltd. (長城中高 Investment Group Co., (遼寧) 物業服務有限公司) Ltd. (北京中高投資集團有限公司)

– VII-17 – THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. APPENDIX VII STATUTORY AND GENERAL INFORMATION

2. Further Information about our Directors and Supervisors

(a) Particulars of Directors’ and Supervisors’ service contracts and appointment letters

Each of the Directors and Supervisors entered into a service contract or appointment letter with our Company. The principal particulars of these service contracts and appointment letters comprise (a) the term of the service; (b) subject to termination in accordance with their respective term; and (c) a dispute resolution provision. The service contracts and appointment letters may be renewed in accordance with our Articles of Association and the applicable laws, rules and regulations from time to time.

Save as disclosed above, none of the Directors or Supervisors has or is proposed to have a service contract with any member of our Group (other than contracts expiring or determinable by the relevant employer within one year without the payment of compensation (other than statutory compensation).

(b) Others

(i) None of the Directors, Supervisors, or any past Directors of any members of our Group has been paid any sum of money for the years ended December 31, 2018, 2019 and 2020 and the three months ended March 31, 2021 (i) as an inducement to join or upon joining our Company or (ii) for loss of office as a director of any member of our Group or of any other office in connection with the management of the affairs of any member of our Group.

(ii) There has been no arrangement under which a Director or Supervisor has waived or agreed to waive any remuneration or benefits in kind for the years ended December 31, 2018, 2019 and 2020 and the three months ended March 31, 2021.

(iii) None of the Directors or Supervisors has been or is interested in the promotion of, or in the property proposed to be acquired by, our Company, and no sum has been paid or agreed to be paid to any of them in cash or shares or otherwise by any person either to induce him/her to become, or to qualify him/her as, a Director or a Supervisor, or otherwise for services rendered by him in connection with the promotion or formation of our Company.

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3. Agency fees or commissions received

Save as disclosed in this section, none of the Directors, Supervisors or any of the persons whose names are listed under “—D. Other Information—8. Consents of Experts” in this Appendix had received any commissions, discounts, agency fee, brokerages or other special terms in connection with the issue or sale of any capital of any member of our Group within the two years immediately preceding the date of this document.

4. Directors’ and Supervisors’ remuneration

For the years ended December 31, 2018, 2019 and 2020 and the three months ended March 31, 2021, the aggregate amount of fees, salaries, housing allowance and contributions to a retirement benefit scheme and other allowance and benefits in kind granted by us to our Directors and Supervisors were approximately RMB4.15 million, RMB10.30 million, RMB10.73 million and RMB1.97 million, respectively.

Under the current arrangements, our Directors and Supervisors are entitled to receive compensation (including fees, salaries, housing allowance and contributions to a retirement benefit scheme) from our Company for the year ending December 31, 2021 under arrangement in force as of the date of this document which is approximately RMB12.30 million in aggregate.

5. Disclaimers

(a) none of our Directors or Supervisors nor any of the parties listed in “—D. Other Information—8. Consents of Experts” in this Appendix has any direct or indirect interest in the promotion of our Company, or in any assets which within the two years immediately preceding the date of this document, have been acquired or disposed of by or leased to any member of our Group, or are proposed to be acquired or disposed of by or leased to any member of our Group;

(b) save as disclosed in this section, none of our Directors or Supervisors is a director or employee of a company which is expected to have an interest in the Shares falling to be disclosed to our Company and the Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO once the H Shares are [REDACTED] on the Stock Exchange;

(c) none of our Directors or Supervisors nor any of the parties listed in “—D. Other Information—8. Consents of Experts” in this Appendix, is materially interested in any contract or arrangement subsisting at the date of this document which is significant in relation to the business of our Group as a whole;

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(d) save for the [REDACTED], none of the parties listed in “—D. Other Information—8. Consents of Experts” in this Appendix:

(i) is interested legally or beneficially in any of our Shares or any shares of any of our subsidiaries; or

(ii) has any right or option (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe securities in any member of our Group;

(e) so far as is known to our Directors as of the Latest Practicable Date, none of the Directors, their respective associates or Shareholders of our Company (who is interested in more than 5% of the registered capital of our Company) has any interests in any of our top five suppliers and top five customers; and

(f) none of the Directors is interested in any business (other than the business of our Group) which competes or is likely to compete, directly or indirectly, with our business.

D. OTHER INFORMATION

1. Estate duty

As advised by our PRC Legal Advisors, the PRC currently does not impose any estate duty.

2. Tax and Other Indemnities

Our Controlling Shareholder has entered into a deed of indemnity with and in favor of each member of our Company (being the contract referred to in paragraph (I) of “—B. Further Information about Our Business—1. Summary of Material Contracts” above) to provide indemnities on a joint and several basis in respect of taxation resulting from income, profits or gains earned, accrued or received.

3. Litigation

Save as disclosed in this document, we are not aware of any material legal proceedings, claims or disputes currently existing or pending against us, and no litigation, arbitration or claim of material importance is known to our Directors to be pending or threatened against us that may have a material adverse effect on our business, financial position or results of operations.

– VII-20 – THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. APPENDIX VII STATUTORY AND GENERAL INFORMATION

4. Joint Sponsors

The Joint Sponsors, Huatai Financial Holdings (Hong Kong) Limited and Ping An of China Capital (Hong Kong) Company Limited, satisfy the independence criteria applicable to sponsors set out in Rule 3A.07 of the Listing Rules.

The Joint Sponsors will receive an aggregate fee of HK$5,868,129 for acting as the Joint Sponsors for the [REDACTED].

5. Preliminary expenses

Our Company has not incurred any preliminary expenses.

6. Promoters

The promoters of our Company are the following:

(a) Trade Union;

(b) Centralcon Holding;

(d) Mr. Yang Zhongchang; and

(e) Shenzhen Changcheng Storage and Transportation Co., Ltd. (深圳市長城儲運有限公司), formerly known as Shenzhen Changcheng Storage and Transportation Co. (深圳市長城儲運公司).

Save as disclosed in the section headed “History, Reorganization and Corporate Structure”, within the two years immediately preceding the date of this document, no cash, securities or other benefit has been paid, allotted or given nor are any proposed to be paid, allotted or given to any promoters in connection with the [REDACTED] and the related transactions described in this document.

– VII-21 – THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. APPENDIX VII STATUTORY AND GENERAL INFORMATION

7. Qualification of experts

The following are the qualifications of the experts who have given opinion or advice which are contained in this document:

Name Qualifications

Huatai Financial Holdings Licensed under the SFO to conduct type 1 (Hong Kong) Limited (dealing in securities), type 2 (dealing in futures contracts), type 4 (advising on securities), type 6 (advising on corporate finance) and type 9 (asset management) regulated activities as defined under the SFO

Ping An of China Capital Licensed under the SFO to conduct type 6 (Hong Kong) Company (advising on corporate finance) regulated Limited activity as defined under the SFO

PricewaterhouseCoopers Certified Public Accountants under Professional Accountants Ordinance (Chapter 50 of the Laws of Hong Kong) and Registered Public Interest Entity Auditor under Financial Reporting Council Ordinance (Chapter 588 of the Laws of Hong Kong)

Global Law Office PRC Legal Advisors to our Company

China Index Academy Industry consultant

Jones Lang LaSalle Corporate Property Valuer Appraisal and Advisory Limited

8. Consents of experts

Each of the experts named in paragraph 7 of this Appendix has given and has not withdrawn its respective written consent to the issue of this document with the inclusion of its report and/or letter and/or opinion and/or the references to its name included in this document the form and context in which it is respectively included.

– VII-22 – THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. APPENDIX VII STATUTORY AND GENERAL INFORMATION

9. Interests of experts in our Company

None of the persons named in paragraph 7 of this Appendix is interested beneficially or otherwise in any Shares or shares of any member of our Group or has any right or option (whether legally enforceable or not) to subscribe for or nominate persons to subscribe for any shares or securities in any member of our Group.

10. Taxation of holders of H Shares

The sale, purchase and transfer of H Shares are subject to Hong Kong stamp duty. The current rate chargeable on each of the seller and purchaser is HK$1.00 for every HK$1,000 (or part thereof) of the consideration or, if higher, the fair value of the H Shares being sold or transferred.

11. Binding effect

This document shall have the effect, if an application is made in pursuance of this document, of rendering all persons concerned bound by all of the provisions (other than the penal provisions) of sections 44A and 44B of the Companies (Winding Up and Miscellaneous Provisions) Ordinance insofar as applicable.

12. Miscellaneous

(a) Within the two years immediately preceding the date of this document:

(i) no share or loan capital of our Company or any of our subsidiaries has been issued or agreed to be issued or is proposed to be fully or partly paid either for cash or a consideration other than cash;

(ii) no share or loan capital of our Company or any of our subsidiaries is under option or is agreed conditionally or unconditionally to be put under option;

(iii) no commissions, discounts, brokerages or other special terms have been granted or agreed to be granted in connection with the issue or sale of any share or loan capital of our Company or any of our subsidiaries; and

(iv) no commission has been paid or is payable for subscription, agreeing to subscribe, procuring subscription or agreeing to procure subscription of any share in our Company or any of our subsidiaries.

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(b) Our Directors confirm that:

(i) there has been no material adverse change in the financial or trading position or prospects of our Group since March 31, 2021 (being the date to which the latest audited consolidated financial statements of our Group were prepared); and

(ii) there has not been any interruption in the business of our Group which may have or has had a significant effect on the financial position of our Group in the 12 months preceding the date of this document;

(d) All necessary arrangements have been made to enable our H Shares to be admitted into CCASS for clearing and settlement;

(e) No company within our Group is presently listed on any stock exchange or traded on any trading system;

(f) Our Company has no outstanding convertible debt securities or debentures;

(g) There is no arrangement under which future dividends are waived or agreed to be waived;

(h) None of the equity and debt securities of our Company, if any, is listed or dealt with in any other stock exchange nor is any listing or permission to deal being or proposed to be sought;

(i) There is no subsidiary in our Group which is a sino-foreign equity joint venture or which operates as or under a cooperative or contractual joint venture; and

(j) We currently do not intend to apply for the status of sino-foreign investment joint stock limited company and do not expect to be subject to the PRC Foreign Investment Law.

13. Bilingual Document

The English and Chinese language versions of this document are being published separately, in reliance upon the exemption provided by section 4 of the Companies (Exemption of Companies and Prospectuses from Compliance with Provisions) Notice (Chapter 32L of the Laws of Hong Kong).

– VII-24 – THIS DOCUMENT IS IN DRAFT FORM, INCOMPLETE AND SUBJECT TO CHANGE AND THAT THE INFORMATION MUST BE READ IN CONJUNCTION WITH THE SECTION HEADED “WARNING” ON THE COVER OF THIS DOCUMENT. APPENDIX VIII DOCUMENTS DELIVERED TO THE REGISTRAR OF COMPANIES AND AVAILABLE FOR INSPECTION

A. DOCUMENTS DELIVERED TO THE REGISTRAR OF COMPANIES

The documents attached to the copy of this document and delivered to the Registrar of Companies in Hong Kong for registration were:

(a) a copy of the [REDACTED];

(b) the written consents referred to in “Statutory and General Information— D. Other Information—8. Consents of Experts” in Appendix VII to this document; and

(c) a copy of each of the material contracts referred to in “Statutory and General Information—B. Further Information about Our Business—1. Summary of Material Contracts” in Appendix VII to this document.

B. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents will be available for inspection at the offices of Sidley Austin at 39/F, Two International Finance Centre, 8 Finance Street, Central, Hong Kong during normal business hours from 9:30 a.m. to 5:30 p.m. up to and including the date which is 14 days from the date of this document:

(a) the Articles of Association;

(b) the Accountant’s Report from PricewaterhouseCoopers, the text of which is set out in Appendix I to this document;

(c) the report from PricewaterhouseCoopers in respect of the unaudited pro forma financial information, the text of which is set out in Appendix II to this document;

(d) the audited consolidated financial statements of our Group for the three financial years ended December 31, 2018, 2019 and 2020 and the three months ended March 31, 2021;

(e) the property valuation report issued by Jones Lang LaSalle Corporate Appraisal and Advisory Limited, the texts of which are set out in Appendix III to this document;

(f) the material contracts referred to in “Statutory and General Information— B. Further Information about Our Business—1. Summary of Material Contracts” in Appendix VII to this document;

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(g) the service contracts referred to in “Statutory and General Information— C. Further Information about Our Directors, Supervisors and Substantial Shareholders—2. Further Information about Our Directors and Supervisors—(a) Particulars of Directors’ and Supervisors’ Service Contracts and Appointment Letters” in Appendix VII to this document;

(h) the legal opinion issued by Global Law Office, our PRC Legal Advisor, in respect of our Group’s business operations and property interests in the PRC;

(i) the written consents referred to “Statutory and General Information— D. Other Information—8. Consents of Experts” in Appendix VII to this document;

(j) the PRC Company Law, the PRC Securities Law, the Mandatory Provisions and the Special Regulations together with their unofficial English translation; and

(k) the report issued by China Index Academy.

– VIII-2 –