RONGHUI JOY LIFE GROUP LIMITED 融匯悅生活集團有限公司 (The “Company”) (Incorporated in the Cayman Islands 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

RONGHUI JOY LIFE GROUP LIMITED 融匯悅生活集團有限公司 (the “Company”) (incorporated in the Cayman Islands 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 sole sponsor, 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 sole sponsor, 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 sole sponsor, 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 obtain independent professional advice.

RONGHUI JOY LIFE GROUP LIMITED 融匯悅生活集團有限公司 (incorporated in the Cayman Islands with limited liability)

[REDACTED]

Number of [REDACTED] under : [REDACTED] Shares the [REDACTED] (subject to the [REDACTED]) Number of [REDACTED] : [REDACTED] Shares (subject to adjustment) Number of [REDACTED] : [REDACTED] Shares (subject to adjustment and [REDACTED]) [REDACTED] : HKD[REDACTED] per Share plus brokerage of 1%, SFC transaction levy of 0.0027% and the Stock Exchange trading fee of 0.005% (payable in full on application subject to refund) Nominal value : HKD0.01 per Share [REDACTED] : [REDACTED] Sole Sponsor

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 paragraph headed “Documents Delivered to the Registrar of Companies in Hong Kong” in Appendix V 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. The [REDACTED] is expected to be fixed by agreement between the [REDACTED] (for itself and on behalf of the [REDACTED]) and us on the [REDACTED]. The [REDACTED] is expected to be on or around [REDACTED] and, in any event, not later than [REDACTED]. The [REDACTED] will not be more than HK$[REDACTED] and is currently expected to be not less than HK$[REDACTED]. Investors applying for the [REDACTED] must pay, on application, the [REDACTED]ofHK$[REDACTED] for each Share together with a brokerage of 1%, the SFC transaction levy of 0.0027% and the Stock Exchange trading fee of 0.005%, subject to refund if the [REDACTED] is less than HK$[REDACTED]per[REDACTED]. The [REDACTED] (for itself and on behalf of the [REDACTED]) with the consent of our Company, may reduce the number of [REDACTED] and/or the indicative [REDACTED] below that stated in this document (which is HK$[REDACTED]to HK$[REDACTED]per[REDACTED]) at any time 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 published on the website of the Stock Exchange at www.hkex.com.hk and our website at www.rhjoylife.com. Further details are set out in the sections headed “[REDACTED]” and “How to Apply for [REDACTED]” in this document. If, for any reason, the [REDACTED] (for itself and on behalf of the [REDACTED]) and we are unable to reach an agreement on the [REDACTED]by[REDACTED], the [REDACTED] will not become unconditional and will lapse immediately. Prior to making an investment decision, prospective investors should consider carefully all of the information set out in this document, including the risk factors set out in the section headed “Risk Factors” in this document. The obligations of the Hong Kong [REDACTED] under the Hong Kong [REDACTED]to[REDACTED] for, and to procure [REDACTED] for, the [REDACTED], are subject to termination by the [REDACTED] (for itself and on behalf of the [REDACTED]) if certain events shall occur prior to 8:00 am on [REDACTED]. Such grounds are set out in the section headed “[REDACTED]” in this document. It is important that you refer to that section for further details. The [REDACTED] have not been and will not be registered under the [REDACTED] or any state securities law in the United States and maybe[REDACTED] and sold only outside the United States in an offshore transaction in accordance with [REDACTED] under the [REDACTED].

ATTENTION

We have adopted a fully electronic application process for the [REDACTED]. We will not provide printed copies of this document or printed copies of any [REDACTED] to the public in relation to the [REDACTED].

This document is available at the website of the Stock Exchange at www.hkexnews.hk and our website at www.rhjoylife.com. If you require a printed copy of this document, you may download and print from the website addresses above.

[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

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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)

[REDACTED]

– 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. EXPECTED TIMETABLE(1)

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IMPORTANT NOTICE TO INVESTORS

This document is issued by RongHui Joy Life Group Limited solely in connection with the [REDACTED] and does not constitute [REDACTED] or a [REDACTED] to buy any security other than the [REDACTED] offered by this document pursuant to the [REDACTED]. This document may not be used for the purpose of, and does not constitute, [REDACTED] or [REDACTED] to [REDACTED] or buy, any security 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 other than 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 authorised anyone to provide you with information that is different from what is contained in this document. Any information or representation not made in this document must not be relied on by you as having been authorised by us, the Sole Sponsor, the [REDACTED] and the [REDACTED], any of the [REDACTED], any of our or their respective directors, officers or representatives, or any other person or party involved in the [REDACTED].

Page

SUMMARY ...... 1

DEFINITIONS ...... 11

GLOSSARY OF TECHNICAL TERMS ...... 23

FORWARD-LOOKING STATEMENTS ...... 26

RISK FACTORS ...... 28

WAIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES ...... 68

INFORMATION ABOUT THIS DOCUMENT AND THE [REDACTED] ...... 71

DIRECTORS AND PARTIES INVOLVED IN THE [REDACTED] ...... 75

CORPORATE INFORMATION ...... 79

INDUSTRY OVERVIEW ...... 82

REGULATORY OVERVIEW ...... 92

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Page

HISTORY, REORGANISATION AND CORPORATE STRUCTURE ...... 108

BUSINESS ...... 123

RELATIONSHIP WITH CONTROLLING SHAREHOLDERS ...... 221

DIRECTORS AND SENIOR MANAGEMENT ...... 232

SUBSTANTIAL SHAREHOLDERS ...... 246

SHARE CAPITAL ...... 248

CONNECTED TRANSACTIONS ...... 250

FINANCIAL INFORMATION ...... 257

FUTURE PLANS AND USE OF [REDACTED] ...... 313

[REDACTED] ...... 330

STRUCTURE OF THE [REDACTED] ...... 336

HOW TO APPLY FOR [REDACTED]...... 346

APPENDIX I — ACCOUNTANTS’ REPORT ...... I-1

APPENDIX II — UNAUDITED PRO FORMA FINANCIAL INFORMATION ..... II-1

APPENDIX III — SUMMARY OF THE CONSTITUTION OF OUR COMPANY AND CAYMAN COMPANIES LAW ...... III-1

APPENDIX IV — STATUTORY AND GENERAL INFORMATION ...... IV-1

APPENDIX V — DOCUMENTS DELIVERED TO THE REGISTRAR OF COMPANIES IN HONG KONG AND AVAILABLE FOR INSPECTION ...... V-1

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This summary aims to give you an overview of the information contained in this document. As this is a summary, it does not contain all the information that may be important to you. You should read the entire document 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 the section headed “Risk Factors” in this document. You should read that section carefully before you decide to invest in the [REDACTED]. There are risks associated with any investment. Your investment decision should be made in light of these considerations.

OVERVIEW We are a comprehensive provider of property management services and commercial operational services with over 15 years of operational experience. According to CIA, we ranked 55th among the 2020 Top 100 Property Management Companies and 50th among the 2021 Top 100 Property Management Companies in China in terms of overall strength. We have also been one of the Top 100 Property Management Companies in China for four consecutive years since 2018. We primarily focus on key cities in Chengdu-Chongqing Economic Zone, Bohai Rim Economic Zone and Western Taiwan Straits Economic Zone. We are also a large-scale integrated property management service provider in the Southwest Region that combines property management and commercial operation. According to CIA, among the 2020 Top 100 Property Management Companies in China. We also ranked 36th in terms of total GFA under management of large-scale integrated property, 10th in terms of total GFA under management of large-scale integrated property in the Southwest Region, and fourth in terms of total GFA under management of large-scale integrated property in Chongqing. We were awarded the “China Leading Property Management Companies in terms of Characteristic Service—Large-scale Integrated Property Operational Services” by CIA in both 2020 and 2021. We achieved significant growth during the Track Record Period. Our revenue increased from RMB198.9 million in 2018 to RMB224.2 million in 2019, and further to RMB241.4 million in 2020, representing a CAGR of 10.2% from 2018 to 2020. Our profit for the year increased from RMB18.5 million in 2018 to RMB35.6 million in 2019, and further to RMB54.2 million in 2020, representing a CAGR of 71.2% from 2018 to 2020. The following table sets forth a breakdown of our total revenue by business line during the Track Record Period, both in absolute amount and as a percentage of total revenue during the years indicated: For the year ended 31 December 2018 2019 2020 (RMB’000) (%) (RMB’000) (%) (RMB’000) (%)

Property management services . . . 164,792 82.8 186,785 83.3 203,279 84.2 Commercial operational services . . 34,113 17.2 37,430 16.7 38,072 15.8

Total ...... 198,905 100.0 224,215 100.0 241,351 100.0

We have a long-term, strategic and cooperative relationship with Ronghui Group. We have been providing Ronghui Group with property management services since the establishment of our Group in 2006, and commercial operational services since 2008. Ronghui Group has over 17 years of property development experience and has comprehensive business offerings covering various industries, such as real estate, hotel management, construction engineering, landscape engineering and chemical industry. Ronghui Group was awarded Top 100 Leading Brand of China Comprehensive Real Estate Companies in 2018 and Top 100 China Real Estate Companies in 2019. As at 31 December 2020, Ronghui Group had 58 projects located in Chongqing, Jinan, Fuzhou and Wuhu, including (i) 46 projects which have been delivered (including five partially delivered projects) with a total delivered GFA of approximately 6.3 million sq.m.; and (ii) 17 projects which have not been delivered (including five partially delivered projects) with a total undelivered GFA of 2.1 million sq.m. planned to be delivered by the end of 2023. During the Track Record Period, we were engaged to provide property management services and commercial operational services to substantially all of the properties developed by Ronghui Group. We believe that Ronghui Group’s growth in real estate projects supply would continue to support the future growth of our property management services and commercial operational services.

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We primarily offer general property management services to properties developed by Ronghui Group or joint ventures and associates of Ronghui Group. The following table sets forth a breakdown of our number of projects under management, total GFA under management and total contracted GFA by developer type as at the dates indicated, as well as revenue from general property management services by developer type for the years indicated, both in absolute amount and as a percentage of total GFA under management/total contracted GFA/revenue from general property management services. As at/for the year ended 31 December

2018 2019 2020

Number Number Number of GFA under of GFA under of GFA under projects management Contracted GFA Revenue projects management Contracted GFA Revenue projects management Contracted GFA Revenue

(‘000 (‘000 (‘000 (‘000 (‘000 (‘000 sq.m.) (%) sq.m.) (%) (RMB’000) (%) sq.m.) (%) sq.m.) (%) (RMB’000) (%) sq.m.) (%) sq.m.) (%) (RMB’000) (%)

RonghuiGroup..... 38 5,233.2 91.4 6,997.1 93.4 116,533 93.0 38 5,474.0 90.9 7,353.6 93.1 132,039 93.3 40 5,711.6 89.9 7,441.0 89.7 136,821 92.2 Joint ventures and associates of Ronghui Group...... 4 450.3 7.9 450.3 6.0 8,231 6.5 4 450.3 7.5 450.3 5.7 8,709 6.2 5 525.7 8.3 739.2 8.9 11,021 7.4 Independent third-party property developers . . 1 43.1 0.7 43.1 0.6 597 0.5 1 98.4 1.6 98.4 1.2 737 0.5 2 118.4 1.8 118.4 1.4 600 0.4

Total ...... 43 5,726.6 100.0 7,490.5 100.0 125,361 100.0 43 6,022.7 100.0 7,902.3 100.0 141,485 100.0 47 6,355.7 100.0 8,298.6 100.0 148,442 100.0

The following table sets forth a breakdown of our number of projects and total GFA under management by property type as at the dates indicated, and revenue from general property management services by property type for the years indicated, both in absolute amount and as a percentage of total GFA under management/revenue from general property management services. As at/for the year ended 31 December 2018 2019 2020 Number Number Number of GFA under of GFA under of GFA under projects management Revenue projects management Revenue projects management Revenue (‘000 (‘000 (‘000 sq.m.) (%) (RMB’000) (%) sq.m.) (%) (RMB’000) (%) sq.m.) (%) (RMB’000) (%)

Residential properties .... 34 5,254.1 91.7 101,383 80.9 33 5,451.8 90.5 114,712 81.1 35 5,689.4 89.5 122,121 82.3 Non-residential properties . . – Commercial properties . . 9 472.5 8.3 23,978 19.1 9 472.5 7.9 26,381 18.6 11 567.9 8.9 25,721 17.3 – Public and industrial properties ...... –––––198.4 1.6 392 0.3 1 98.4 1.6 600 0.4

Non-residential properties sub-total ...... 9 472.5 8.3 23,978 19.1 10 570.9 9.5 26,773 18.9 12 666.3 10.5 26,321 17.7

Total ...... 43 5,726.6 100.0 125,361 100.0 43 6,022.7 100.0 141,485 100.0 47 6,355.7 100.0 148,442 100.0

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OUR BUSINESS MODEL

We primarily generate revenue from two business lines: (i) property management services; and (ii) commercial operational services.

Property Management Services

We provide a variety of property management services mainly to non-property owners (primarily property developers), property owners and residents. As at 31 December 2020, we had a total of 47 projects under management and 57 contracted projects for our property management services business line in Chongqing, Fuzhou, Fujian Province, Jinan, Shandong Province and Wuhu, Anhui Province, with a total GFA under management of 6.4 million sq.m. The property management services we provide include:

(i) General property management services. We provide a wide range of general property management services to non-property owners (primarily property developers), property owners and residents, which primarily include customer services, cleaning, security, gardening, repair and maintenance and car park management. Our portfolio of managed properties comprises of (i) residential properties and (ii) non-residential properties primarily including (a) commercial properties, such as commercial towns and office buildings, and (b) public and industrial properties, such as industrial parks, schools and factories;

(ii) Value-added services to non-property owners. We provide value-added services primarily to property developers, which primarily include preliminary design and planning consultancy services, pre-delivery inspection services, repair and maintenance services, sales centre management services and additional tailor-made services. We also provide value-added services to other property management service providers, which primarily include the establishment of property management system and supervision on its operation as one of our additional tailor-made services; and

(iii) Community value-added services. We provide community value-added services to property owners and residents which primarily include sales assistance services, temporary car park management services, common area value-added services and home-living services (such as housekeeping, group buying and travelling services).

Commercial Operational Services

(i) Commercial operational services to tenants. We provide business management services to tenants during the operational stage of the commercial properties, which primarily include tenant coaching, marketing and promotion services and subleasing services; and

(ii) Commercial operational services to property developers and property owners. We provide commercial operational services to property developers and property owners of commercial properties during preparatory stage, which primarily include market research and positioning services during the preparatory stage, tenant sourcing services and pre-opening preparatory services for the launch of new commercial projects.

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OUR STRENGTHS

Our strengths include: (i) large-scale integrated property management service provider in the Southwest Region that combines property management and commercial operation; (ii) proven track record to manage high quality commercial projects with distinctive features; (iii) use of property management information system and commercial operational information system to improve operational efficiency and user experience; (iv) growth opportunities derived from the long-term, strategic and cooperative relationship with Ronghui Group; and (v) professional and devoted management team supported by well-established talent development system.

OUR STRATEGIES

Our strategies include: (i) reinforce our market position in key regions and further develop our business through enlarging our business scale, expanding in regions with strong growth potential and further optimising our project portfolio; (ii) further expand our business operations through strategic acquisitions and investments; (iii) improve our service quality and operational efficiency through upgrades and optimisation of our information management systems and platforms; (iv) develop other diversified value-added services to improve our value-added services penetration rate and continue to upgrade our existing value-added services; (v) enhance our brand image and reputation through marketing initiatives and strategic cooperation with other developers and famous brands; and (vi) attract, retain and motivate talents through systematic training programmes and solid career development opportunities.

RISK FACTORS

Our major risk factors include: (i) substantially all of our revenue during the Track Record Period from general property management services and commercial operational services were generated from properties developed and/or owned by Ronghui Group and/or its associates and joint ventures, over which we do not have control; (ii) our business strategies are subject to uncertainties and risks and our future growth may therefore not materialise as planned; (iii) we may fail to secure new or renew our existing property management service agreements and commercial operational service agreements on favourable terms, or at all; (iv) our future acquisitions or investments may not be successful and we may experience increased financial burden in respect of the acquisitions and investments and face difficulties in integrating acquired operations with our existing operation; (v) our strategic plan to further diversify and expand our services may not succeed as planned in the future; (vi) all of our operations of property management services and commercial operational services are concentrated in Chongqing, Jinan and Fuzhou, and our business could be adversely affected in the event of any adverse development in government policies or economic and business environment in these regions; and (vii) any financial difficulties faced by Ronghui Group and/or its associates and joint ventures may have material adverse impact on our business, financial condition, results of operation and prospects.

SUMMARY OF HISTORICAL FINANCIAL INFORMATION

The following tables set forth selected financial data from our combined financial information for the Track Record Period, extracted from the Accountants’ Report set out in Appendix I to this document. The selected financial data set forth below should be read together with our combined financial statements and the related notes, as well as the section headed “Financial Information” in this document. Our financial information was prepared in accordance with HKFRSs.

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Selected Items of Our Combined Statements of Profit or Loss and other Comprehensive Income For the year ended 31 December 2018 2019 2020 %of %of %of total total total RMB’000 revenue RMB’000 revenue RMB’000 revenue

Revenue ...... 198,905 100.0 224,215 100.0 241,351 100.0 Cost of sales ...... (152,653) (76.7) (166,370) (74.2) (165,507) (68.6)

Gross profit ...... 46,252 23.3 57,845 25.8 75,844 31.4 Other losses/gains, net . (1,006) (0.5) 5,580 2.4 16,690 6.9 Administrative expenses (22,553) (11.4) (21,146) (9.3) (26,467) (11.0) [REDACTED]-related expenses ...... ––––[REDACTED][REDACTED]

Operating profit...... 22,693 11.4 42,279 18.9 64,986 26.9 Share of results of a joint venture ...... 14 0 86 0 99 0 Finance income, net .... 176 0.1 294 0.1 108 0.1

Profit before income tax 22,883 11.5 42,659 19.0 65,193 27.0 Income tax expense .... (4,390) (2.2) (7,072) (3.1) (11,015) (4.6)

Profit and total comprehensive income for the year . . 18,493 9.3 35,587 15.9 54,178 22.4

Selected Items of Our Combined Statements of Financial Position As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Non-current assets 6,174 4,914 7,033 Current assets 417,085 474,414 547,519 Current liabilities 149,659 154,429 175,269 Net current assets 267,426 319,985 372,250 Total assets less current liabilities 273,600 324,899 379,283 Non-current liabilities – 712 918 Total equity 273,600 324,187 378,365

Please refer to the section headed “Financial Information—Description of Certain Combined Balance Sheet Items—Net Current Assets” in this document for further information.

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Selected Items of our Combined Statements of Cash Flows For the Year ended 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Net cash generated from operating activities ...... 53,307 48,026 44,464 Net cash used in investing activities ...... (28,861) (100,367) (15,734) Net cash generated from financing activities ...... 13,781 5,511 6 Net increase/(decrease) in cash and cash equivalents . . . 38,227 (46,830) 28,736

For the year ended 31 December 2019, we recorded net decrease in cash and cash equivalents, primarily reflecting our net cash used in investing activities for the advance to amounts due from related parties.

For further details, please refer to the section headed “Financial Information—Liquidity and Capital Resources—Working Capital Sufficiency” in this document.

Key Financial Ratios

The table below sets forth the key financial ratios as at the dates or for the periods indicated: As at/For the year ended 31 December 2018 2019 2020

Current ratio ...... 2.8 3.1 3.1 Return on assets ...... 4.6% 7.9% 10.5% Return on equity ...... 7.0% 11.9% 15.4% Gross profit margin ...... 23.3% 25.8% 31.4% Net profit margin ...... 9.3% 15.9% 22.4%

Note: For further details, please refer to the section headed “Financial Information — Key Financial Ratios” in this document for description and explanations of the above ratios.

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

Market capitalisation of our Shares(1) ...... HK$[REDACTED] HK$[REDACTED] Unaudited pro forma adjusted net tangible asset per Share(2) ..... HK$[REDACTED] HK$[REDACTED]

Notes:

(1) The calculation of market capitalisation is based on [REDACTED] Shares expected to be in issue following completion of the Capitalisation Issue and the [REDACTED]. This calculation is based on the indicative [REDACTED]ofHK$[REDACTED] and HK$[REDACTED].

(2) The unaudited pro forma adjusted net tangible asset per Share is calculated after making the adjustments referred to in the paragraph headed “Unaudited Pro Forma Financial Information” in Appendix II to this document and on the basis of a total of [REDACTED] Shares expected to be in issue following the completion of the Capitalisation Issue and the [REDACTED]. This calculation is based on the indicative [REDACTED]ofHK$[REDACTED] and HK$[REDACTED].

[REDACTED] EXPENSES

The total amount of the [REDACTED] expenses that will be borne by us in connection with the [REDACTED], including [REDACTED], is estimated to be [REDACTED] (based on the [REDACTED] of the indicative [REDACTED]) of which (i) [REDACTED] million was charged to our combined statement of profit or loss and other comprehensive income in the year ended 31 December 2020; (ii) approximately [REDACTED] million is expected to be charged to our combined statement of profit or loss and other comprehensive income for the year ending 31 December 2021; and (iii) the remaining amount of [REDACTED] million are expected to be accounted for as a deduction from equity upon [REDACTED].

[REDACTED]

We estimate that we will receive [REDACTED]fromthe[REDACTED] of approximately HK$[REDACTED] (after deducting the [REDACTED] fees, [REDACTED] and estimated expenses payable by us in relation to the [REDACTED]), assuming the [REDACTED]isnot exercised and an [REDACTED] of HK$[REDACTED] per Share, being the [REDACTED]ofthe indicative [REDACTED] stated in this document. We intend to use the [REDACTED] we receive from the [REDACTED] as follows:

• approximately [REDACTED], or HK$[REDACTED] million, will be used to expand our property management service business and commercial operational service business;

• approximately [REDACTED] or HK$[REDACTED] million will be used to upgrade our information system and smart platform;

• approximately [REDACTED], or HK$[REDACTED] million, will be used to develop other diversified value-added services to improve our value-added services penetration rate and upgrade our existing value-added services; and

• approximately [REDACTED], or HK$[REDACTED] million, will be used for working capital and general corporate purpose.

Please refer to the section headed “Future Plans and [REDACTED]” in this document for further details, including the proposed arrangement in case the final [REDACTED] is higher or lower than the [REDACTED]ofthe[REDACTED].

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DIVIDEND POLICY

In March 2021, certain of our subsidiaries declared dividends of an aggregate amount of RMB89.0 million to their then shareholders to offset related parties receivables. Save as disclosed above, we did not declare any dividends during the Track Record Period.

OUR CUSTOMERS AND SUPPLIERS

Our customer base primarily consists of property owners, residents, tenants and property developers. In 2018, 2019 and 2020, revenue from our five largest customers amounted to RMB42.6 million, RMB48.8 million and RMB65.5 million, respectively, which accounted for approximately 21.4%, 21.7% and 27.1%, respectively, of our total revenue. During the same periods, revenue from our largest customer Ronghui Group and its related parties amounted to RMB37.4 million, RMB42.8 million and RMB60.9 million, respectively, which accounted for approximately 18.8%, 19.1% and 25.2%, respectively, of our total revenue.

Our suppliers are mainly utility suppliers and subcontractors which provide cleaning, gardening, garbage disposal, security and repairing and maintenance services. In 2018, 2019 and 2020, purchases from our five largest suppliers amounted to RMB18.2 million, RMB17.9 million and RMB18.6 million, respectively, which accounted for approximately 11.9%, 10.8% and 11.2%, respectively, of our total purchases. During the same periods, purchases from our largest supplier amounted to RMB6.6 million, RMB7.1 million and RMB6.3 million, respectively, which accounted for approximately 4.3%, 4.2% and 3.8%, respectively, of our total purchases.

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] or any option which may be granted under the [REDACTED]), our Company will be owned as to [REDACTED]by Wong-Holding, [REDACTED] by Chan-Holding and [REDACTED] by WC-Holding. Wong-Holding is wholly owned by Wong-BVI which is in turn wholly owned by Mr. Wong. Chan-Holding is wholly owned by Chan-BVI, which is in turn wholly owned by Ms. Chan, the spouse of Mr. Wong. WC-Holding is wholly owned by WC-BVI, which is in turn owned as to 55% by Mr. Wong and 45% by Ms. Chan.

On 24 June 2021, Mr. Wong and Ms. Chan entered into an acting-in-concert agreement, whereby they agreed and confirmed that among other things, during the period when they became the registered owners and/or beneficial owners of the interests in our Group to the date when any one of them ceases to be our Controlling Shareholder, they have been acting in concert and will continue to act in concert in respect of the management and control of our Group, including but not limited to the exercise of the voting rights at shareholders’ meetings of each member company within our Group unanimously in accordance with the consensus achieved among them. See the section headed “History, Reorganisation and Corporate Structure—Acting-In-Concert Agreement” in this document for details.

Accordingly, Mr. Wong, Ms. Chan, Wong-Holding, Chan-Holding, WC-Holding, Wong-BVI, Chan-BVI and WC-BVI constitute a group of our Controlling Shareholders. See the section headed “Relationship with Controlling Shareholders” in this document for further details.

We have entered into certain agreements with our connected persons which will constitute continuing connected transactions under Chapter 14A of the Listing Rules upon [REDACTED]. See the section headed “Connected Transactions” in this document for further details.

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LEGAL PROCEEDINGS AND COMPLIANCE

We have been involved in legal proceedings or disputes from time to time in the ordinary course of business, such as contract disputes with our customers, suppliers or disputes with other third parties at properties under our management. As at the Latest Practicable Date, there were no litigation or arbitration proceedings or administrative proceedings pending against us or any of our Directors which would have a material adverse effect on our business, financial position or results of operations. As at 31 December 2020, we made provision of RMB933,600 for liabilities related to claims by suppliers and employees against us. Our Directors believe that such provision is adequate. As at the Latest Practicable Date, we were involved in a litigation in relation to Chongqing Xintianyuan which rendered certain of our GFA under management as at the Latest Practicable Date in dispute. Please refer to the section headed “Business — Legal Proceedings and Compliance — Legal Proceedings — Xintianyuan Litigation”.

During the Track Record Period, 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. We have made provisions for our shortfall of contribution to social insurance and housing provident funds in the amount of RMB2.5 million, RMB2.3 million and RMB2.1 million for the years ended 31 December 2018, 2019 and 2020, respectively. We have implemented internal policies and procedures for the prevention of future non-compliance incidents of similar nature.

EFFECT OF THE COVID-19 PANDEMIC

Effects of the COVID-19 Pandemic on Our Business Operations

The COVID-19 pandemic had a certain level of short term impact on the property management industry, mainly in relation to costs and management. In particular, our following services have experienced certain short-term impact as a result of the COVID-19 pandemic.

• Property management services. To comply with government regulations and measures to combat the COVID-19 pandemic, we incurred additional medical and sterilisation material costs in 2020. In 2020, we did not experience any significant difficulty in collecting management fee.

• Sales centre management services. Certain of the sales offices and show flats we managed suspended operations. In 2020, three projects were delayed due to the COVID-19 pandemic while we did not record any significant loss due to such delay as we also postponed our personnel deployment accordingly. These projects have been delivered in 2020.

• Common area value-added services. During the COVID-19 pandemic, our ability to rent out community spaces was negatively affected.

Our Contingency Plan and Response to the COVID-19 Pandemic

In response to the COVID-19 pandemic, we have adopted the following hygiene and precautionary measures across the properties under our management since late January 2020.

• Communications with the relevant government authorities. We have been closely monitoring and following the latest regulatory measures on combatting the COVID-19 pandemic in terms of measuring the body temperature of residents, visitors and our employees, and timely reporting potential issues to the relevant authorities.

• Activity suspension. Where necessary, we may suspend various playgrounds and recreation centres and other facilities under our management, and cancelled various community cultural events to reduce gathering of people.

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• Disinfection. We spray disinfectants in public facilities, building corridors, elevators and other public spaces under our management.

• Garbage disposal. We designate specialised collection and disposal sites for used masks and other potentially hazardous materials.

• Property owner education. We actively inform property owners through WeChat groups and community posters regarding the latest policies and measures on the COVID-19 pandemic as well as our plans as a property management service providers.

Please refer to the section headed “Business—Effect of the COVID-19 Pandemic” for further information.

RECENT DEVELOPMENTS AND NO MATERIAL ADVERSE CHANGE

Since 1 January 2021 and up to the Latest Practicable Date, we had secured new engagements to provide property management services and/or commercial operational services in respect of four properties developed by Independent Third Parties as follows:

(i) on 9 April 2021, we entered into a commercial operational service agreement for tenant sourcing services to Banan Yudong Old Street (巴南魚洞老街), a property located in Chongqing developed by Independent Third Party property developer with a total GFA available for tenant sourcing of 25,756.9 sq.m; and

(ii) in May 2021, we acquired 51% equity interest in Chongqing Xintianyuan from Independent Third Parties. Please refer to the section headed “History, Reorganisation and Corporate Structure—Recent Acquisition” in this document for further information. Immediately before our acquisition, Chongqing Xintianyuan had three property management projects with a total GFA under management of approximately 851,248.9 sq.m.

As at the Latest Practicable Date, we had: (i) 52 projects under management for our property management service business lines with a total GFA under management of 7.6 million sq.m.; and (ii) provided commercial operation services to 14 projects with a total contracted GFA of 0.4 million sq.m.

Going forward, we will continue our efforts in increasing the scale of our services provided to projects developed by independent third-party property developers.

For the purpose of the Reorganisation, there was a reduction of the registered capital of our several operating subsidiaries by approximately RMB205 million. Please refer to the section headed “History, Reorganisation and Corporate Structure—Reorganisation—2. Reduction of registered capital of certain operating subsidiaries” for further information.

As at 30 April 2021, we had net current assets of RMB93.5 million.

Recent Acquisition

For the purpose of expanding our property management business, on 25 May 2021, Chongqing Ronghui PM acquired 49% and 2% equity interest in Chongqing Xintianyuan from each of Mr. Zhu Xiaopeng (朱小鵬) and Mr. Wang Yi (王藝) , respectively, at a total consideration of RMB10.2 million. Each of Mr. Zhu Xiaopeng and Mr. Wang Yi is an Independent Third Party. Upon completion of such equity transfer, Chongqing Xintianyuan became owned as to 51% by Chongqing Ronghui PM and 49% by Mr. Zhu Xiaopeng. Please refer to the section headed “History, Reorganisation an Corporate Structure” in this document for further information.

–10– 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

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

“Articles of Association” or “Articles” the articles of association of the Company adopted on [●], which will become effective upon the [REDACTED], as amended from time to time, a summary of which is set out in Appendix III to this document;

“associates” has the meaning ascribed to it under the Listing Rules;

“Board” or “Board of Directors” the board of Directors of our Company;

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

“BVI” the British Virgin Islands;

“Capitalisation Issue” the issue of [REDACTED] Shares to be made upon capitalisation of certain sum standing to the credit of the share premium account of the Company as referred to in the section headed “Statutory and General Information—A. Further Information about our Group—4. Written resolutions of our Shareholders passed on [●]” in Appendix IV to this document;

[REDACTED]

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[REDACTED]

“Chan-BVI” Ronghui Sun International Limited, a limited liability company incorporated in the BVI on 18 January 2021, which is wholly owned by Ms. Chan, and is one of our Controlling Shareholders;

“Chan-Holding” Ronghui Sun Investment Limited, a limited liability company incorporated in the BVI on 25 January 2021 which is indirectly wholly owned by Ms. Chan through Chan-BVI, and is one of our Controlling Shareholders;

“China” or the “PRC” the People’s Republic of China, but for the purpose of this document and for geographical reference only and except where the context requires, references in this document to “China” and the “PRC” do not include Hong Kong, the Macau Special Administrative Region of the PRC and Taiwan;

“China Index Academy” or “CIA” China Index Academy (中指研究院), our industry consultant and an Independent Third Party;

“Chinese government” or “PRC the central government of the PRC and all government” governmental subdivisions (including provincial, municipal and other regional or local government entities) and instrumentalities thereof or, where the context requires, any of them;

“Chongqing Ronghui PM” 重慶融匯物業管理有限公司 (Chongqing Ronghui Property Management Co., Ltd.), a company established in the PRC with limited liability on 23 June 2006 and an indirect wholly-owned subsidiary of our Company;

“Chongqing Ronghui Properties” 重慶融匯地產（集團）有限公司 (Chongqing Ronghui Real Estate (Group) Co., Ltd.) (previously known as 重慶融匯置業有限公司 (Chongqing Ronghui Real Estate Co., Ltd.), a company established in the PRC with limited liability on 14 July 2008 and wholly owned by Ronghui Fujian, and an affiliate of our Company;

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“Chongqing Xintianyuan” 重慶新天源物業管理有限公司 (Chongqing Xintianyuan Property Management Co., Ltd.), a company established in the PRC with limited liability on 7 December 2007 and an indirect non-wholly owned subsidiary of our Company owned as to 51% by Chongqing Ronghui PM and 49% by an Independent Third Party save for the interest therein;

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

“Companies Act” the Companies Act, Cap. 22 (Act 3 of 1961, as consolidated and revised) of the Cayman Islands;

“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,” “the Company,” or “our RongHui Joy Life Group Limited (融匯悅生活集團有限 Company” 公司), an exempted liability company incorporated in the Cayman Islands with limited liability on 1 February 2021;

“connected person(s)” has the meaning ascribed to it under the Listing Rules;

“Controlling Shareholder(s)” has the meaning ascribed to it under the Listing Rules and, unless the context requires otherwise, refers to Mr. Wong, Ms. Chan, Wong-Holding, Chan-Holding, WC-Holding, Wong-BVI, Chan-BVI and WC-BVI;

“core connected person(s)” has the meaning ascribed to it under the Listing Rules;

“COVID-19” a viral respiratory disease caused by the severe acute respiratory syndrome coronavirus 2, which is believed to have first emerged in late 2019;

“CSDCC” China Securities Depository and Clearing Corporation Limited (中國證券登記結算有限責任公司);

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“Deed of Indemnity” the deed of indemnity dated [●] 2021 executed by our Controlling Shareholders in favour of our Company (for ourselves and for each of our subsidiaries), as further described under the section headed “Statutory and General Information—E. Other Information—1. Tax and other indemnities” in Appendix IV to this document;

“Deed of Non-Competition” the deed of non-competition dated [●] 2021 executed by Mr. Wong and Ms. Chan in favour of our Company (for ourselves and for each of our subsidiaries), as further described under the section headed “Relationship with Controlling Shareholders—Deed of Non-Competition” in this document;

“Director(s)” or “our Directors” the director(s) of our Company;

“Exchange Participant(s)” a person: (a) who, in accordance with the Listing Rules, may trade on or through the Stock Exchange; and (b) whose name is entered in a list, register or roll kept by the Stock Exchange as a person who may trade on or through the Stock Exchange;

“Extreme Conditions” extreme conditions caused by a super typhoon as announced by the Government of Hong Kong;

“Fujian Ronghui PM” 福建融匯物業管理有限公司 (Fujian Ronghui Property Management Co., Ltd.), a company established in the PRC with limited liability on 22 January 2007 and an indirect wholly-owned subsidiary of our Company;

“Funeng Ronghui” Fuzhou Funeng Ronghui Property Management Co., Ltd. (福州福能融匯物業管理有限公司), a company established in the PRC with limited liability on 21 December 2017 and owned as to 50% by Fujian Ronghui RM and 50% by an Independent Third Party save for its interest therein;

“Fuzhou Ronghui” 福州融匯置業有限公司 (Fuzhou Ronghui Real Estate Co., Ltd.), a company established in the PRC with limited liability on 25 August 2008 and an indirect wholly-owned subsidiary of our Company;

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[REDACTED]

“Group,” “the Group,” “our Group,” our Company and, except where the context “we” or “us” otherwise requires, all of its subsidiaries or where the context refers to any time prior to its incorporation, the business which its predecessors or the predecessors of its present subsidiaries were engaged in and which were subsequently assumed by it;

“HKFRSs” Hong Kong Financial Reporting Standards which include Standards and interpretations promulgated by the Hong Kong Institute of Certified Public Accountants

[REDACTED]

“HK$” or “Hong Kong dollars” “HK Hong Kong dollars and cents respectively, the lawful dollars” or “cents” currency of Hong Kong;

“Hong Kong” the Hong Kong Special Administrative Region of the PRC;

[REDACTED]

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[REDACTED]

“Independent Third Party(ies)” an individual or a company who, as far as the Directors are aware after having made all reasonable enquiries is not a connected person of the Company within the meaning of the Listing Rules;

[REDACTED]

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[REDACTED]

“Latest Practicable Date” 20 June 2021, being the latest practicable date for the purpose of ascertaining certain information in this document prior to its publication;

[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;

“Main Board” the stock exchange (excluding the option market) operated by the Stock Exchange, which is independent from and operated in parallel with the Growth Enterprise Market of the Stock Exchange;

–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

“Memorandum” or “Memorandum of the amended and restated memorandum of Association” association of the Company, conditionally adopted on [●] 2021 and will come into effect upon listing, as amended, supplemented or otherwise modified from time to time, a summary of which is set out in Appendix III to this document;

“Mr. Wong” Mr. Wong Cho Shi (黃祖仕), the spouse of Ms. Chan and one of our ultimate Controlling Shareholders;

“Ms. Chan” Ms. Chan Sun Ping (陳新萍), the spouse of Mr. Wong and one of our ultimate Controlling Shareholders;

[REDACTED]

“PRC Legal Advisors” Commerce & Finance Law Offices, legal advisors to the Company on PRC laws in connection with the [REDACTED];

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[REDACTED]

“Province” or “province” each being a province or, where the context requires, a provincial level autonomous region or municipality under the direct supervision of the PRC Government;

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

“Reorganisation” the reorganisation of our Group in preparation of the [REDACTED], details of which are set out in the section headed “History, Reorganisation and Corporate Structure” in this document;

“Ronghui CM” 重慶融匯商業管理有限公司 (Chongqing Ronghui Commercial Management Co., Ltd.), a company established in the PRC with limited liability on 12 October 2012 and an indirect wholly-owned subsidiary of our Company;

“Ronghui Cultural” 山東融匯創意文化產業有限公司 (Shandong Ronghui Creative Cultural Industry Co., Ltd.), a company established in the PRC with limited liability on 23 July 2012 and an indirect wholly-owned subsidiary of our Company;

“Ronghui Fujian” Ronghui (Fujian) Group Co., Ltd. (融匯（福建）集團有限公司), a company established in the PRC with limited liability on 18 October 2005 and indirectly owned as to 55% by Mr. Wong and 45% by Ms. Chan;

“Ronghui Group” Ronghui Fujian and its subsidiaries;

“Ronghui Guanling” 重慶融匯冠嶺商業地產營運管理有限公司 (Chongqing Ronghui Guanling Commercial Real Estate Operation Management Co., Ltd.), a company established in the PRC with limited liability on 2 May 2013 and an indirect wholly-owned subsidiary of our Company;

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“Ronghui Jiayue” 重慶融匯家悅企業管理有限公司 (Chongqing Ronghui Jiayue Corporate Management Co., Ltd.), a company established in the PRC with limited liability on 4 March 2021 and an indirect wholly-owned subsidiary of our Company;

“Ronghui Youjia” 重慶融匯優家智慧生活服務有限公司(Chongqing Ronghui Youjia Smart Life Services Co., Ltd.), a company established in PRC with limited liability on 12 January 2021 and an indirect wholly-owned subsidiary of our Company;

“Securities and Futures Ordinance” or the Securities and Futures Ordinance (Chapter 571 of “SFO” the Laws of Hong Kong), as amended, supplemented or otherwise modified from time to time;

“SFC” the Securities and Futures Commission of Hong Kong;

“Shandong Ronghui LSB” 山東融匯老商埠商業運營管理有限公司 (Shandong Ronghui Laoshangbu Commercial Operation Management Co., Ltd.), a company established in the PRC with limited liability on 17 July 2012 and an indirect wholly-owned subsidiary of our Company;

“Shandong Ronghui Properties” Shandong Ronghui Properties Co., Ltd. (山東融匯置業有限公司), a company established in the PRC with limited liability on 15 April 2011 and is owned as to 95% by an indirect subsidiary of Ronghui Fujian and 5% by a company wholly owned by Mr. Chen Zhong, our non-executive Director;

“Share(s)” ordinary share(s) with par value of HK$0.01 each in the share capital of the Company, which are to be traded in Hong Kong dollars and [REDACTED]on the Main Board;

“Shareholders” holders of our Shares;

[REDACTED]

“Southwest Region” for the purpose of this document, the southwest region of China, including Chongqing, Sichuan, Yunnan, Guizhou and Tibet

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[REDACTED]

“Stock Exchange” The Stock Exchange of Hong Kong Limited;

“subsidiary(ies)” has the meaning ascribed to it under the Listing Rules;

“substantial shareholder(s)” has the meaning ascribed to it under the Listing Rules;

“Takeovers Code” the Codes on Takeovers and Mergers and Share Buy-backs issued by the SFC, as amended, supplemented or otherwise modified from time to time;

“Tax Advisors” Zhitong (Fujian) Registered Tax Agents Co., Ltd. (致同（福建）稅務師事務所有限責任公司), our PRC tax advisors and an Independent Third Party

“Track Record Period” the period comprising the years ended 31 December 2018, 2019 and 2020;

[REDACTED]

“United States” or “U.S.” the United States of America, its territories, its possessions and all areas subject to its jurisdiction;

“U.S. dollars” or “US$” United States dollars, the lawful currency of the United States;

“U.S. Securities Act” the United States Securities Act of 1933, as amended;

“WC-BVI” Ronghui Group Limited, a limited liability company incorporated in the BVI on 18 January 2021 which is owned as to 55% by Mr. Wong and 45% by Ms. Chan, and is one of our Controlling Shareholders;

“WC-Holding” Ronghui Global Investment Limited, a limited liability company incorporated in the BVI on 25 January 2021 which is wholly owned by WC-BVI, and is one of our Controlling Shareholders;

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[REDACTED]

“Wong-BVI” Ronghui International Limited, a limited liability company incorporated in the BVI on 18 January 2021, which is wholly owned by Mr. Wong, and is one of our Controlling Shareholders; and

“Wong-Holding” Ronghui Company Limited, a limited liability company incorporated in the BVI on 25 January 2021 which is indirectly wholly owned by Mr. Wong through Wong-BVI, and is one of our Controlling Shareholders.

“WTC Deed of Non-Competition” the deed of non-competition dated [●] 2021 executed by Ms. Wong Tan Ching in favour of our Company (for ourselves and for each of our subsidiaries), as further described under the section headed “Directors and Senior Management—Board of Directors— Executive Directors” in this document;

“WWL Deed of Non-Competition” the deed of non-competition dated [●] 2021 executed by Mr. Wong Wai Lam in favour of our Company (for ourselves and for each of our subsidiaries), as further described under the section headed “Directors and Senior Management—Board of Directors—Executive Directors” in this document;

Unless the content otherwise requires, references to “2018”, “2019” and “2020” in this document refers to our financial year ended 31 December of such year.

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

For ease of reference, the names of the PRC laws and regulations, governmental authorities, institutions, natural persons or other entities (including certain of our subsidiaries) have been included in the document in both the Chinese and English languages and in the event of any inconsistency, the Chinese versions shall prevail. English translations of official Chinese names are for identification purpose only.

* for identification purposes only

–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. GLOSSARY OF TECHNICAL TERMS

In this document, 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 commercial operational average commercial operational fee(s) charged on fee(s) charged on tenants” tenants per sq.m. per month, which is calculated as the total revenue generated from commercial operational services to tenants divided by the GFA leased to the tenants on an annual basis

“average property management weighted average property management fee(s) fee(s)” charged per sq.m. per month with reference to GFA under management for projects as at a relevant date excluding (i) the GFA under management of certain common areas, such as facility rooms, management offices and car parks; and (ii) the GFA under management of package price projects

“CAGR” compound annual growth rate

“collection rate” for our property management services, the amount of the general property management fees collected for a relevant period as a percentage of the total general property management fees entitled to be received for the same period, except for management fees in respect of car parking units

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

“commission basis” a revenue generating model for our property management business line whereby our fee income from property management consists only of a specified percentage of the total management fees payable by the property owners or property developers while the remainder of such management fees would be used to procure services to the property from other service providers

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“contracted GFA” GFA under management or contracted to be managed by us under property management service agreements or commercial operational service contracts, including both delivered and undelivered GFA, irrespective whether we have recorded revenue or not

“GFA” gross floor area

“GFA under management” GFA of properties for which we have started to provide general property management services

“IoT” or “Internet of Things” a network of physical devices, vehicles, buildings and other item embedded with electronics, software, sensors and network connectivity that enable these objects to collect and exchange data

“lump sum basis” a revenue generating model for our property management business line whereby we charge a predetermined property management price per GFA for all units (whether sold or unsold) on a monthly basis which represents the all-inclusive fees for all of the property management services provided by our teams and subcontractors. Under a lump sum basis, the property owners and property developers will be responsible for paying our management fees for the sold and unsold units respectively on a monthly basis

“occupancy rate” a rate calculated as the GFA leased to tenants divided by the total leasable GFA of a commercial property, which is the contracted GFA less certain public areas and facilities, as of the end of each relevant period based on our internal record

“residential communities” or for purpose of this document, properties which are “residential property(ies)” purely residential or mixed-use properties containing residential units and ancillary facilities that are non-residential in nature such as retail shops and service apartments 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 that same period

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

“Top 100 Property Management an annual ranking of China-based property Companies” management companies by overall strengths published by CIA solely or jointly with other institution(s) based on a number of key indicators, including management scale, operational performance, service quality, growth potential and social responsibility of such companies in the preceding year, which comprised 100, 100, 210, 200, 200, 220, 244 and 264 companies for rankings published in 2014, 2015, 2016, 2017, 2018, 2019, 2020 and 2021 respectively. The number of companies recognised for each of 2016, 2017, 2018, 2019, 2020 and 2021, exceeded 100 as multiple companies with the same or very close scores were assigned the same ranking

“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 to provide property management services or commercial operational services

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We have included in this document forward-looking statements. Statements that are not historical facts, including statements about our intentions, beliefs, expectations or predictions for the future, are 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 materialise 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 business prospects;

• our business and operating strategies and our ability to implement such strategies;

• our ability to control or reduce costs;

• our capability to identify and integrate suitable acquisition targets;

• our ability to maintain a strong relationship with major suppliers or customers;

• our dividend policy;

• any changes in the laws, rules and regulations of the central and local governments in the PRC and the rules, regulations and policies of the relevant governmental authorities relating to all aspects of our business and our business plans;

• the future competitive environment for the PRC property management industry;

• general economic, political and business conditions in the PRC real estate markets and property management industries;

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

• capital market development;

• interest rate and exchange rate fluctuations and restrictions;

• determination of the fair value of our Shares;

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

• risks identified under the section headed “Risk Factors” in this document.

This document also contains market data and projections 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. You should not place undue reliance on these forward-looking statements.

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 headed “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 at 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 and 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.

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An investment in our Shares involves various risks. You should carefully consider the following information about risks, together with the other information contained in this document, including our financial statements and related notes, before you decide to purchase our Shares. If any of the circumstances or events described below actually arises or occurs, our business, results of operations, financial condition, and prospects would likely suffer. In any such case, the market price of our Shares could decline, and you may lose all or part of your investment. This document also contains forward-looking information that involves risks and uncertainties. Our actual results could differ materially from those anticipated in the forward-looking statements as a result of many factors, including the risks described below and elsewhere in this document.

RISKS RELATING TO OUR BUSINESS AND INDUSTRY

Substantially all of our revenue during the Track Record Period from general property management services and commercial operational services were generated from properties developed and/or owned by Ronghui Group and/or its associates and joint ventures, over which we do not have control.

During the Track Record Period, substantially all of our revenue was generated from property management services and commercial operational services in relation to properties developed by Ronghui Group and/or its associates and joint ventures. In 2018, 2019 and 2020, revenue generated from our provision of general property management services to properties developed by Ronghui Group and/or its associates and joint ventures, accounted for 99.5%, 99.5% and 99.6%, respectively, of our revenue generated from our provision of general property management services, and revenue generated from our provision of commercial operational services to the commercial properties developed by Ronghui Group and/or its associates and joint ventures, accounted for 99.2%, 100.0% and 100.0%, respectively, of our revenue generated from our provision of commercial operational services.

As we do not have control over Ronghui Group’ business strategy, nor the macroeconomic or other factors that affect their business operations, any adverse development in the business, operations, financial condition or prospects of Ronghui Group and/or its associates and joint ventures, its ability to realise their development plans on time or at all or its ability to develop new properties may affect our ability to procure new property management service agreements and commercial operational service agreements.

In addition, we cannot assure you that Ronghui Group and/or its associates and joint ventures will engage us as their property management service provider for properties they develop, particularly because the appointment of property management companies is generally subject to a tender process under PRC laws. In addition, we cannot assure you that all of our property management service agreements and commercial operational service agreements with Ronghui Group and/or its associates and joint ventures will be renewed successfully upon their expiration on commercially acceptable terms or at all. We cannot assure you that we will be successful in procuring service contracts from alternative sources to make up for the shortfall in a timely manner or on favourable terms. Though we plan to expand our business by seeking cooperation with the Independent Third Parties, we cannot assure you that we will be successful in doing so or be able to enter into such co-operation on commercially favourable terms. Should any of these events occur, our business, financial condition and results of operations could be materially and adversely affected.

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Our business strategies are subject to uncertainties and risks and our future growth may therefore not materialise as planned.

We seek to continue expanding our business through increasing our contracted GFA and the number of properties we are contracted to manage in existing and new markets, including properties developed by Ronghui Group, joint ventures and associates of Ronghui Group and the Independent Third Parties. Please refer to the section headed “Business—Our Strategies” in this document for details. As at 31 December 2018, 2019 and 2020, our aggregated contracted GFA under property management service segment amounted to approximately 7.5 million sq.m., 7.9 million sq.m., and 8.3 million sq.m., respectively. During the same period, our aggregate contracted GFA under commercial operational service segment amounted to approximately 0.3 million sq.m., 0.3 million sq.m., and 0.3 million sq.m., respectively. We base our expansion plans on our assessment of market prospects. We cannot assure you that our assessment will prove to be correct or that we can grow our business as planned. Our expansion plans may be affected by a number of factors, most of which are beyond our control. Such factors include:

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

• changes in disposable personal income, level of consumer spending, consumer confidence and fluctuations in seasonal spending in the PRC;

• changes in applicable laws, government regulations or policies;

• changes in the supply of and demand for property management services and commercial operational services;

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

• our ability to recruit, retain and train competent employees;

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

• our ability to understand the needs of property developers, residents or tenants in the residential properties where we provide property management services or property developers or tenants in the commercial properties where we provide commercial operational services;

• our ability to diversify our services offering and to optimise our business mix;

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

• our ability to solidify our market position in existing market and our ability to leverage our brand names and to compete successfully in new markets, particularly against the incumbent players in such markets who might have more resources and experience than we do;

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• our ability to maintain effective information technology systems to support our business and development plans; and

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

Since our business strategies are subject to uncertainties and risks, we cannot assure you that our future growth will materialise. 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 may fail to secure new or renew our existing property management service agreements and commercial operational service agreements on favourable terms, or at all.

We believe that our ability to expand our portfolio of property management service agreements and commercial operational services agreements is crucial to our sustainable growth. During the Track Record Period, we procured new or renewed existing property management service agreements and commercial operational service agreements through participating in tenders or through direct negotiations with the property developers or property owners’ association. The selection of a property management service provider or a commercial operational service provider by property developers or property owners’ association depends on a number of factors, including but not limited to the quality of services, the level of pricing, reputation and the operating history of the property management service provider. We cannot assure you that we will be able to procure new or renew existing property management service agreements and commercial operational service agreements on favourable 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 service and commercial operational service market. In addition, the termination and non-renewal of property management service agreements and commercial operational service agreements could potentially be detrimental to our reputation and diminish our competitiveness within the market. In 2018, 2019 and 2020, we had two, three and two expired general property management agreements, respectively, and among which we renewed one, two and two agreements, respectively. During the Track Record Period, we did not renew two property service agreements for residential properties after their expiration, which was mainly due to the fact that management fees we proposed for providing the required level of services were not accepted by the respective property owners’ associations, or as a result of the delivery of the project to government. There is no guarantee that we would be able to find other business opportunities and enter into alternative property management service agreements or commercial operational service agreements on favourable terms, or at all. During the Track Record Period, we did not experience any failure to renew our property management service agreements and commercial operational service agreements as a result of our default.

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Our future acquisitions or investments may not be successful and we may experience increased financial burden in respect of the acquisitions and investments and face difficulties in integrating acquired operations with our existing operation.

We plan to expand our business through acquisitions or investments, and plan to evaluate opportunities to acquire or invest other property management companies, commercial service providers and other businesses that are complementary to our existing businesses and integrate their operations into ours. However, we cannot assure you 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 or investments on terms favourable or acceptable to us, in a timely manner, or at all. The inability to identify suitable acquisition targets or to complete acquisitions could materially and adversely affect our competitiveness and growth prospects.

Acquisitions or investments, even if completed, will involve uncertainties and risks, including, without limitation:

• potential ongoing financial obligations, litigations or claims or disputes and unforeseen or hidden legal, regulatory, financial or other liabilities;

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

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

• assumption of debt and liabilities of the acquired companies, some of which may not have been revealed during the due diligence process; and

• diversion of resources and management attention.

Approximately [REDACTED]%, or HK$[REDACTED], of the [REDACTED] received by our Company from the [REDACTED] is expected to be used to pursue selective strategic investment and acquisition opportunities and further develop strategic alliances. Please refer to the section headed “Future Plans and [REDACTED]” in this document. 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 [REDACTED] from the [REDACTED] may not be effectively used.

Moreover, we may require additional cash resources to finance our continued growth or other future developments, including any investments or acquisitions we may decide to pursue. To the extent that our funding requirements exceed our financial resources, we will be required to seek additional financing or to defer planned expenditures. Interest rate increases or other unfavourable changes in the financial markets may increase our cost of borrowing or adversely affect our ability to access sources of liquidity upon which we may rely to finance our operations and satisfy our obligations as they become due. There is no assurance that we will be able to obtain sufficient financing on favourable terms, or at all, to fund our future expansion. Furthermore, if we raise additional funds through equity or equity-linked financings, your equity interest in our Company may be diluted. Alternatively, if we raise additional funds by

–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 incurring debt obligations, we may be subject to various covenants under the relevant debt instruments that may, among other things, restrict our ability and flexibility to operate our business, pay dividends or obtain additional financing. Servicing such debt obligations could also be burdensome to our operations. If we fail to service such debt obligations or are unable to comply with any of these covenants, we could be in default under such debt obligations and our liquidity and financial condition could be materially and adversely affected.

Furthermore, we may face difficulties in, and additional risks of, integrating acquired operations with our existing business. The difficulties and risks will be affected by different factors, including, among others, the complexity and size of the acquired business. Particularly, we may face the difficulties in retaining the acquired company’s personnel and integrating the existing workforce with that of the acquired companies. Such difficulties could disrupt our ongoing business, distract the attention of our management and employees or increase our expenses. The prior dealings of the acquired company may have given rise to situations which, although unknown or deemed immaterial during due diligence could be exposed post- acquisition and cause damage to our brand. We may also face the risks of operating in new markets with local regulations unfamiliar to us and incur additional hidden costs associated with the acquisition. Any of these difficulties or risks could materially and adversely affect our business, financial condition and results of operations.

Acquisitions may result in goodwill recorded in our combined financial statements. If we fail to achieve our desired objectives with respect to our acquisitions, we may need to record impairment losses on our goodwill, which may materially and adversely reduce our assets and impact our profitability that would, in turn, have an adverse effect on our financial position and results of operations.

Our strategic plan to further diversify and expand our services may not succeed as planned in the future.

We have diversified our services by providing various value-added services to meet the evolving needs of our customers, primarily including property owners, residents, tenants and property developers. However, with limited operating history and experience in certain regions, we may face unknown risks, rising expenses and fierce competition in the market. We have encountered and expect to continue to encounter risks and difficulties frequently experienced in relation to new service offerings, and those risks and difficulties may be heightened in a rapidly evolving market. Those risks and difficulties may affect our ability to:

• attract and retain customers and qualified employees;

• develop and maintain close cooperation with strategic partners to offer certain services;

• maintain effective control of our development as well as operating costs and expenses;

• develop and maintain internal personnel, systems, controls and procedures to comply with the extensive regulatory requirements applicable to the relevant industries;

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• cater for various consumer preferences, or anticipate product or service trends that will appeal to existing or potential customers;

• respond to competitive market conditions and changes in industry environments; or

• respond to changes in regulatory environment.

Our failure to achieve any of the above may jeopardise our ability to offer newly introduced value-added services, as well as other new services we plan to launch. We are dedicated to satisfying our customers’ needs by further strengthening our capabilities to provide and diversify our value-added services. Please refer to the section headed “Business—Our Strategies—Improve our service quality and operational efficiency through upgrades and optimisation of our information management systems and platforms” in this document. Launching new services and products, changing our service models or entering into new markets may also require substantial time, resources and capital. We may have limited ability to leverage on our brand name in the industries related to our value-added services in the way that we have done so in the property management industry, which could hinder our results of operations in the new market.

Furthermore, we cannot assure you that our investment in our value-added services can be recouped in a timely manner, or at all, or our investment return would be higher than that of other comparable companies. Our development of and investment in diversified services may be subject to PRC laws and regulations governing licence approval and renewal. Please refer to the section headed “Regulatory Overview” in this document. We cannot assure you that we can obtain or renew our licence on time, if at all. We cannot assure you that our future strategic development plan, which is based upon our forward-looking assessment of market prospects and customer preferences, will always turn out to be successful. A number of factors beyond our control may also affect our plan for the development of diversified services, including 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 business, financial position and results of operations.

All of our operations of property management services and commercial operational services are concentrated in Chongqing, Jinan and Fuzhou, and our business could be adversely affected in the event of any adverse development in government policies or economic and business environment in these regions.

As at the Latest Practicable Date, all of our property management services and commercial operational services were concentrated in Chongqing, Jinan and Fuzhou. As at 31 December 2018, 2019 and 2020, we managed an aggregate GFA of approximately 5.7 million sq.m., 6.0 million sq.m. and 6.4 million sq.m., respectively, of properties under property management service segment mainly in Chongqing, Jinan and Fuzhou collectively. Over the same period, we had an aggregate contracted GFA of approximately 0.3 million sq.m., 0.3 million sq.m. and 0.3 million sq.m., respectively, of properties under commercial operational service segment mainly in Chongqing, Jinan and Fuzhou collectively. Given such concentration, any material adverse social, economic or political development in or any natural disaster or epidemic affecting

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Chongqing, Jinan or Fuzhou could materially and adversely affect our business, financial position and results of operations.

Any financial difficulties faced by Ronghui Group and/or its associates and joint ventures may have material adverse impact on our business, financial condition, results of operation and prospects

During the Track Record Period, a large portion of our revenue from property management services was generated from services provided in relation to properties developed by Ronghui Group and/or its associates and joint ventures. In this relation, any adverse development in the business, financial condition or prospects of Ronghui Group and/or its associates and joint ventures, or any financial difficulties faced by Ronghui Group and/or its associates and joint ventures or its ability to develop and complete new properties may negatively affect our procurement of new service contracts for property management services and value-added services to non-property owners, which may in turn have a negative impact on our business, financial condition, results of operation and prospects.

Moreover, the real estate industry, in which Ronghui Group and/or its associates and joint ventures operates, is heavily regulated by the PRC Government. Please refer to the section headed “Risk Factors—We are subject to the regulatory environment and measures affecting the PRC property management and real estate industries” in this document. The PRC government may promulgate new initiatives or implement more stringent measures to regulate the real estate industry in the future, such as setting caps on certain debt ratios, with a view to controlling the increase of the debt levels in the real estate sector. Such potential initiatives or measures, once in place, may further limit property developers’ access to capital and slow down the overall growth of the real estate sector and revenue expansion of property developers, including Ronghui Group and/or its associates and joint ventures, which may in turn negatively impact the growth of the property management industry and the supply of new properties for management by property management companies like us. In the event that Ronghui Group and/or its associates and joint ventures fails to obtain sufficient financing and such financial difficulties result in delays in completion of its projects, the growth of our GFA under management will be affected, which in turn will adversely affect the growth of our property management services.

We may encounter difficulties in collecting our property management services and commercial operational service fees, which could lead to impairment losses or write off of our trade receivables.

We may encounter difficulties when collecting our property management fees in communities, or service fees where a tenant has experienced any difficulties in continuing operations for any other factors. Delays in receiving such fees would adversely affect our cash flow position and our ability to meet our working capital requirements. Even though we seek to collect overdue service 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 rate.

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Our provision for impairment of trade receivables amounted to RMB5.7 million, RMB1.9 million and RMB2.5 million as at 31 December 2018, 2019 and 2020, respectively. Pursuant to the terms of our property management service agreements, property owners are typically required to pay their property management fee on a monthly basis. However, certain property owners do not pay their property management fees in accordance with the terms of the relevant property management service contracts and tend to pay such fees in one or more instalments during or towards the end of a year.

Although our management’s estimates and the related assumptions were made in accordance with information available to us, such estimates or assumptions may need to be adjusted if new information becomes known. Please refer to the section headed “Financial Information—Significant Accounting Policies, Estimates and Judgements—Provision for impairment of trade and other receivables” in this document for details. In the event that 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 or write off of our trade receivables, which could in turn materially and adversely affect our business, financial condition and results of operations.

We may experience fluctuations in our labour and subcontracting costs.

In 2018, 2019, and 2020, our staff costs recognised in cost of sales accounted for 63.7%, 64.5% and 64.0% of our total cost of sales, respectively. We also engage third-party subcontractors mainly to provide cleaning, gardening, garbage disposal and repair and maintenance services for the properties under our management. In 2018, 2019 and 2020, our subcontracting costs accounted for 17.7%, 19.5% and 20.9% of our total cost of sales, respectively. We believe that controlling and reducing our staff and subcontracting costs are essential to maintaining and improving our profit margins. However, we face pressure from rising staff and subcontracting costs due to various contributing factors, including but not limited to:

• Increase in minimum wage — The minimum wage in regions we operate has increased in recent years, directly affecting our staff costs as well as the fees we pay to our third-party subcontractors.

• Inflation and general economic conditions — as a result of inflation, improvement of economic conditions, increase in GDP per capita, the general level of remuneration have increased. In view of the competition to recruit quality staff, we may have to offer more competitive package to attract talents.

• Increase in headcount — As we expand our operations, the headcount of our residential property and commercial operational management staff, sales and marketing staff and administrative staff and/or the usage of third-party subcontractors will continue to grow. We will also need to retain and continuously recruit qualified employees to meet our growing demand for talent, which will further increase our total headcount. The increase in headcount will also increase our costs such as those related to salaries, training, social insurance and housing provident fund contributions and quality control measures.

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• Delay in implementing technological solutions, service standardisation and other measures to reduce our reliance on manual labour and cost of services — Usually there is a lapse between the time we begin commercial operational services or property management services for a particular property and the time we start implementing any of our measures to reduce our reliance on manual labour and cost of services. Before we carry out such measures, our ability to mitigate the impact of any increases in staff and subcontracting costs is limited.

We cannot assure you that we will be able to control our costs or improve our operational efficiency. If we fail to achieve this goal, our business, financial condition and results of operations could be materially and adversely affected.

We face certain risks in relation to the large-scale integrated properties.

According to CIA, large scale integrated property refers to a real estate project that contains residential properties as well as properties for commercial purposes with a GFA of construction of more than 500,000 sq.m. that has the integrated functions, such as residential and commercial consumption. As at 31 December 2020, we had three large-scale integrated properties with total GFA under management of 5.1 million sq.m., making up the large majority of our total GFA under management. As a special business combination, the large-scale integrated property has the characteristics of large scale, high density, and diversified property types. Although we typically separately participate in the tender process and enter into property management agreements with the property developers or property owners’ associations for different phases of the large-scale integrated properties, if our property management services agreements for any phase of the large-scale integrated properties are terminated or if we fail to renew such agreements, our reputation and our ability to obtain, perform or renew the property management agreements for other phases of the same large-scale integrated properties may be negatively affected. As a result, our business operations and financial performance could be materially and negatively affected.

We recorded revenue from gain on disposal of financial assets which was nonrecurring in nature

We recorded a non-recurring gain on disposal of financial assets amounting to nil, nil and RMB14.9 million for the years ended 31 December 2018, 2019 and 2020, respectively, as a result of our disposal of held-for-trading financial assets. For details, please refer to the section headed “Financial Information—Key Components of our Combined Statements of Profit or Loss and Other Comprehensive Income—Other Losses/Gains, net” in this document.

Income from gain on disposal of financial assets was non-recurring in nature. Going forward, we may not have financial assets available for sale. Even if we have financial assets available for sale, the selling price of such financial assets at the time of sale also depends on market conditions and our management’s judgement in their discretion which is subject to certain assumptions. If we fail to sell our financial assets at a fair value due to management’s judgement or changes in market conditions, we may suffer losses. Such losses could adversely affect our business, financial conditions and results of operations.

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We may be subject to losses and our profit margins may decrease if we fail to control our costs in rendering our property management services on a lump sum basis.

We generated all of our revenue from properties managed on a lump sum basis during the Track Record Period. On a lump sum basis, we charge property management fees at a predetermined fixed price per sq.m. per month, representing all-inclusive fees for the property management services provided. When total costs and expenses incurred exceed the amount of property management fees we receive, we bear the shortfall and may not charge additional fees to property developers, property owners or residents during the contract term. In 2018, 2019 and 2020, we incurred losses of RMB1.4 million, RMB1.8 million and RMB0.9 million, respectively, with respect to seven, six and three 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. Our revenue from property management services from such loss-making properties was approximately RMB17.5 million, RMB15.7 million and RMB9.3 million in 2018, 2019 and 2020, respectively, representing 8.8%, 7.0% and 3.9% of our total revenue for the same periods, respectively.

To improve our profitability, we can either try to improve our fee rates when renewing service agreements, or control our costs and expenses through a series of cost-saving initiatives. However, our ability to mitigate losses through cost-saving initiatives, such as operation automation measures to reduce labour costs and energy-saving measures to reduce energy costs, may not be successful. Moreover, our cost-saving efforts may negatively affect the quality of our property management services, which in turn will reduce property owners’ willingness to pay us property management fees. We may be also subject to local regulations on price control and may require consent from property owner(s) which may restrict our ability to raise our fee rates. Therefore, we cannot assure you that we could successfully raise our fee rates; nor could we assure you that our cost-saving initiatives will achieve their intended results. Failure to raise our fee rates or implement cost-saving measures could materially and adversely affect our results of operations and financial condition.

We face a wide range of competition and may fail to compete effectively and operate profitably.

According to CIA, the PRC property management industry is intensely competitive and highly fragmented. Please refer to the section headed”Industry Overview—the PRC Property Management Industry—Overview” in this document. We compete with other property management service providers and commercial operational service providers that operate on national, regional and local scales. They may have stronger capital resources, longer operating histories, better track records, greater brand or name recognition, greater expertise in regional and local markets and greater financial, technical, marketing and public relations resources than we do. They may also be better positioned than we are to compete for customers, financing, skilled management and labour resources, and devote more resources to the development, expansion, and promotion of their property management services and commercial operational services. In addition, property developers may establish their own in-house property management businesses or engage their affiliated service providers. These developments may reduce the availability of business opportunities and customers as there would be fewer property developers in the market who would be willing to refer business to us. Since our competitors may seek to emulate our business model, we may lose our competitive edge should

–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 we fail to continue improving and thereby distinguish ourselves from other service providers. Our customers may opt to work with our competitors upon the expiry of our existing service contracts as competitive pressures intensify, and we may be less likely to successfully obtain new service agreements.

In addition, our efforts to compete may compel us to reduce prices for our property management services and commercial operational services, while competitive pressures may force us to further enhance service quality, thereby increasing our cost of services. We cannot assure you that we will be able to pass additional costs to our customers. Failures to compete effectively may erode our profit margins and market share, which could in turn materially and adversely affect our business, financial condition, results of operations and growth potential.

We may not be able to accurately position the commercial properties under our management.

During the Track Record Period, we derive a portion of our revenue from commercial operational services business line, which accounted for approximately 17.2%, 16.7% and 15.8%, respectively, of our total revenue for the three years ended 31 December 2020. However, we may not be able to sustain the current growth of or further expand our commercial operational services, or maintain the gross margin of such revenue stream.

Our ability to derive revenue on a sustainable basis from our commercial operations and command a reasonable gross margin for such revenue stream will depend on our ability to accurately assess the positioning, market demand and competitive status of the properties that we provide commercial operational services to, a failure of which would in turn adversely affect our results of operations and financial condition.

Certain anchor stores or other major tenants have significant impact on our ability to attract customers to commercial properties under our management.

Commercial properties, especially shopping centres and shopping streets, under our management are typically anchored by stores of recognised brands, supermarkets and cinemas. The operations of the commercial properties could be materially and adversely affected if these anchors or other major tenants suffer a decline in their business, fail to comply with their contractual obligations, such as timely payment of commercial operational services fees, or cease their operations.

Certain anchor stores and other large retailers may experience decreases in consumer traffic in their retail stores due to uncertainty and less-than-desirable levels of consumer confidence, increased competition from alternative retail options such as those accessible via the Internet and other forms of pressure on their business models. As pressure on these anchor stores and large retailers increases, their ability to maintain their stores and meet their obligations both to property owners and us and to their external lenders may be impaired and result in closures of their stores.

If any of the anchor or major tenant is to close its store at the commercial properties under our management, we may have difficulty and experience delay in sourcing new tenants, as well as in leasing spaces in areas adjacent to such vacant anchor store or large retailer. Additionally, anchor store or large retailer closures may result in decreased consumer traffic, which could

–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 lead to decreased sales at other stores. If the business of stores operating in commercial properties under our management were to decline significantly due to the closing of anchor stores or other large retailers, adverse economic conditions, or other reasons, tenants may be unable to pay the commercial property management fees or other expenses. In the event of any default by a tenant, we may not be able to fully recover, and/or may experience delays and costs in enforcing our rights as a service provider to recover amounts due to us under the terms of our agreements with such parties.

Rapid growth of the e-commerce business in China may have negative impact on the operation of physical stores in the commercial properties we manage, which may in turn affect our profitability.

As the e-commerce business in China has experienced rapid growth, the purchasing habits of the consumers may undergo significant changes. People may tend to shop online instead of visiting the physical stores which may result in decrease of consumer traffic and may negatively impact the business and financial condition of our tenants in the commercial properties under our management. In the event that the business and financial condition of these tenants are affected by the change in purchasing habits or preferences of the consumers, they may decrease their rental area or even cease to rent the stores. We cannot assure you that we will be able to maintain our historical growth rates of revenue and profit, or remain profitable, if such adverse changes occur.

Expansion of our business may expose us to increased risks of non-compliance with the laws and regulations in new geographic markets and new services.

As we expand our operations into new geographic markets and diversify our service offerings, we expect to become subject to an increasing number of laws and regulations. In addition, as the size and scope of our operations increase, the difficulty of ensuring compliance with the applicable laws and regulations and the potential of being subject to penalties or fines for non-compliances may increase accordingly. If we fail to comply with the applicable laws and regulations, the competent authorities may impose penalties on us. The laws and regulations applicable to our business, whether national, provincial or local, may also evolve in ways that substantially increase our costs of compliance, and any non-compliance could result in significant financial penalties, which could have a material adverse effect on our business, results of operations and financial position.

Brand and reputation are our key assets, which will be affected by how we are perceived in the marketplace.

Brand and reputation and their attributes are our key assets. We provide property management services under the brand of RongHui Joy Life. Our ability to attract and retain customers is highly dependent upon the external perceptions of our level of service, trustworthiness, business practices, management, workplace culture, financial condition, our response to unexpected events and other subjective qualities. Negative perceptions or publicity regarding these matters, even if related to seemingly isolated incidents and whether or not factually correct, could erode trust and confidence and damage our reputation among existing and potential clients, which could make it difficult for us to attract new customers and maintain existing ones.

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We believe our continued success depends on our ability to preserve, grow and leverage the value of our brand and reputation. The protection of our brand, including related trademarks, may require the expenditure of significant financial and operational resources. Moreover, the steps we take to protect our brand may not adequately protect our rights or prevent third parties from infringing or misappropriating our trademarks. Even when we detect infringement or misappropriation of our trademarks, we may not be able to enforce all such trademarks. Any unauthorised use by third parties of our brand may adversely affect our brand. As we continue to expand our business, there is also a risk we may face claims of infringement or other alleged violations of third-party intellectual property rights, which may restrict us from leveraging our brand in a manner consistent with our business goals.

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 media platforms. Our employees or agents may receive negative publicity relating to their on-the-job or off-the-job speech or conduct, which may reflect negatively on us. Partner vendors for our service may also be subject to 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. Given our close relationship with Ronghui Group and/or its associates and joint ventures from whose projects and properties we derive a large portion of our property management services revenue, negative publicity about Ronghui Group and/or its associates and joint ventures, its business, results of operations and financial condition could adversely affect our reputation, business and share price. Any such negative publicity, regardless of veracity, could materially and adversely affect our business, our reputation and the trading price of our Shares.

In addition, accidents may occur in the ordinary course of our business, and we may be exposed to media coverages as well as claims for injuries and fatality sustained by our employees, subcontractors, or unrelated third parties. Such occurrences may damage our reputation not only within the property management industry but also among the general public.

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

During the Track Record Period, we delegated certain property management services, primarily including cleaning, gardening, garbage disposal and repair and maintenance services, to third-party subcontractors. In 2018, 2019, and 2020, subcontracting costs amounted to approximately RMB26.9 million, RMB32.5 million and RMB34.6 million, respectively, accounting for approximately 17.7%, 19.5% and 20.9% of our total cost of sales, respectively. We select our third-party subcontractors based on factors such as professional qualifications, industry reputation, service quality and price competitiveness. However, we cannot assure you that they will always perform or willing to fulfil their obligation in accordance with our expectations and we may not be able to monitor their services as directly and efficiently as with

–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 our own services. They may take actions contrary to our or our customers’ instructions or requests, or be unable or unwilling to fulfil their obligations. As a result, we may have disputes with our subcontractors, or may be held responsible for their actions, either of which could lead to damages to our reputation, additional expenses and business disruptions and potentially expose us to litigation and damage claims.

We cannot assure you that upon the expiration of our agreements with our current third-party subcontractors, we will be able to renew such agreements or find suitable replacements in a timely manner, on terms acceptable to us, or at all.

In addition, if our third-party subcontractors fail to maintain a stable team of qualified manual labour or do not have easy access to a stable supply of qualified manual labour or fails to perform their obligations properly or in a timely manner, the work process may be interrupted. Any interruption to the third-party subcontractors’ work process may potentially result in a breach of the contract between our customers and us. Any of such events could materially and adversely affect our service quality, our reputation, as well as our business, financial position and results of operations.

We are exposed to liabilities from disputes involving losses or damages incurred by services provided through our community value-added services and/or value-added services to non-property owners 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. Claims may arise due to our employees’ or third-party subcontractors’ negligence or recklessness when providing community value-added services and/or value-added services to non-property owners. 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 services provided by or through us fail to conform to required service quality; (ii) advertisements made in common areas with respect to such services are false, deceptive, misleading, libellous, injurious to the public welfare otherwise offensive; (iii) such 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, or could result in personal injury or death, and could subject us to legal liability. 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. Any of these events could materially harm our brand and reputation and marketability of such products or services, which may materially and adversely affect our business, results of operation and financial position.

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

During the Track Record Period, we failed to make adequate social insurance and housing provident fund contributions for some of our employees as required by the relevant PRC laws and regulations. Please refer to the section headed “Business—Legal Proceedings and Compliance—Historical Non-compliance Incident” in this document for details of our non-compliance in relation to social insurance and housing provident fund contributions.

There is no assurance that we will not be subject to penalties or fines imposed by the relevant PRC authority as a result of such non-compliance incident. We have made provisions for our shortfall of contribution to social insurance and housing provident funds in the amount of RMB2.5 million, RMB2.3 million and RMB2.1 million for the years ended 31 December 2018, 2019 and 2020, respectively. In the event that the relevant authority later strengthens the enforcement of the relevant laws and regulations on social insurance and housing provident fund in respect of the enterprises within its jurisdiction and accordingly require payment by enterprises of underpaid social insurance fund or housing provident fund and impose penalties, the amount of which may be significant, our Group’s business, financial condition and operating results may be materially and adversely affected.

We may be involved in legal disputes from time to time, which may adversely affect our financial position, divert management attention and harm our reputation.

From time to time, we may be directly or indirectly involved in legal disputes with customers (including property owners’ association), employees, tenants, subcontractors, regulatory bodies or other third parties. These legal disputes may relate to, service quality, contractual warranties, employment, negligence and intellectual property. For example, tenants may bring claims against us for perceived failures (actual or otherwise) to perform in accordance with their expectations as to service quality. Our employees and subcontractors may also sue us for various reasons, including, among others, occupational injuries and employment related disputes. We are subject to risks associated with having limited control over the behaviour of employees, subcontractors and other third parties who may accidentally or intentionally harm the interests of our customers. As at 31 December 2020, we made provision of RMB933,600 for liabilities related to claims by suppliers and employees against us. Any claims, disputes and legal proceedings brought against us, with or without merit, could result in substantial costs and divert capital resources and management attention. We may suffer damage to our reputation regardless of whether we prevail, leading to material adverse effects on our business, financial position and brand value.

Certain of our GFA under management for property management services as at the Latest Practicable Date was in dispute

As at the Latest Practicable Date, we had GFA under management for property management services of 7.6 million sq.m., among which 0.4 million sq.m. was in dispute as a result of a litigation involving our non-wholly owned subsidiary, Chongqing Xintianyuan. Please refer to the section headed “Business—Legal Proceedings and Compliance—Legal Proceedings—Xintianyuan Litigation” in this document for further information. If we do not succeed in the Xintianyuan Litigation (as defined below), we may be required to cease to

–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 provide property management services and collect property management fee in relation to the 0.4 million sq.m. GFA under management which was in dispute as at the Latest Practicable Date, which could have a negative impact on our results of operations and financial performance. Even if we succeed in the Xintianyuan Litigation, our relationship with the property owners’ association of the relevant property may be impaired which could still have a negative impact on our continuous management of the relevant property.

Damage to the common areas of our managed properties as a result of any natural disasters, intended or unintended actions of property owners or residents or other events 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. According to the Measures for the Management of Special Maintenance of Residential Buildings《住宅專項維修資金管理辦法》 ( ), which was jointly issued by the Ministry of Construction and the MOF on 4 December 2007 and became effective on 1 February 2008, owners of residential properties are required to establish special maintenance funds which is used for maintenance, renewal, transformation of residential common parts, common facilities and equipment. Nevertheless, 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, typhoons, fires, accidents or intentional harms, 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. Although PRC law mandates that property owners shall top-up the special fund once less than 30% of the initial amount of money remains, there is no guarantee that any refill plan proposed would be approved by property owners’ associations or the local housing authority. 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. In addition, we are operating in Chongqing, Fujian Province and Shandong Province which are susceptible to earthquakes and in Fujian Province and Shandong Province which are susceptible to typhoons, and we may expand into other markets that are geographically located in areas susceptible to earthquakes or typhoons and thereby increase the chances of us being affected by these natural disasters and therefore materially and adversely affect our business, financial condition and results of operations.

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Our use of certain key information systems may be interrupted and our planned upgrades may not be successful.

Certain of our key information systems, including intelligent property management platform and commercial operational management platform, are developed and maintained by Independent Third Parties. If the service providers for our information systems are alleged for infringing other parties’ intellectual property rights and/or cease to provide maintenance services and/or fail to provide appropriate and quality maintenance services in a timely manner, our use of these key information systems may be interrupted and our business operations may be materially adversely affected.

We plan to upgrade our property management information system and commercial operational information system, primarily through (i) intelligent property management platform upgrade; (ii) intelligent community facilities management system upgrade; (iii) smart community service platform upgrade; and (iv) commercial operational management platform upgrade. Please refer to the section headed “Business—Our Strategies—Improve our service quality and operational efficiency through upgrades and optimisation of our information management systems and platforms” in this document for further details. We plan to migrate and integrate our management information system with our own system independently from the developer to be maintained by us. We cannot assure you that such migration will be successful. If not successful, there can be no assurance that the service provider engaged or to be engaged by us would carry out the information systems upgrades as planned or the functions we design can be materialised.

We may experience failures in or disruptions to our information technology systems.

We rely on our information technology systems to manage key operational functions including, among others, managing and monitoring daily business operations and settling payments with our customers. However, we cannot assure you that damages or interruptions caused by power outages, computer viruses, hardware and software failures, telecommunication failures, fires, natural disasters, security breaches, changes in regulatory environment and other similar occurrences relating to our information systems will not occur going forward. We may incur significant costs in restoring any damaged information technology systems. 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.

Failure to protect confidential information of our customers and our network against security breaches, any actual or perceived failure by us or third parties to comply with applicable data protection laws and regulations or privacy policies could harm our business, financial condition and results of operations.

We collect, store and process personal and other sensitive data from our customers, such as addresses and phone numbers. Our security measures may be breached due to employee error, malfeasance, system errors or vulnerabilities, or otherwise. Outside parties may also attempt to fraudulently induce employees to disclose sensitive information in order to gain access to our data or our customers’ data. While we have taken steps to protect the confidential

–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 information that we have access to, our security measures could be breached. Because techniques used to sabotage or obtain unauthorised access to systems change frequently and generally are not recognised until they are launched against a target, we may be unable to anticipate these techniques or to implement adequate preventative measures. Any accidental or willful security breaches or other unauthorised access to our platforms could cause confidential customer information to be stolen and used for unlawful purposes. Security breaches or unauthorised access to confidential information could also expose us to liability related to the loss of the information, time-consuming and expensive litigation and negative publicity.

We launched Xiaohui Dangjia App as an integrated one-stop online service platform for property owners and residents of our managed properties. During the course of our business operations and through Xiaohui Dangjia, we collect data from our customers. For example, we receive, process and store personal information of property owners and residents when they create an online account and make use of the services available on Xiaohui Dangjia. Although we have implemented a series of measures to ensure the security of our customers’ data, our current security measures may still not be sufficient. Privacy and data protection laws for mobile platforms are evolving rapidly. Any failure or perceived failure by us to comply with the relevant privacy and data protection laws, rules and regulations, our data protection measures or any compromise in security resulting in unauthorised access, release or transfer of personally identifiable information or data on Xiaohui Dangjia may result in enforcement actions, litigations, or public sanctions against us. Any loss of trust or confidence in us by property owners and residents of our managed properties may also deter them from using Xiaohui Dangjia and lead to a long-term detrimental effect on our business and reputation.

Under the Cyber Security Law of the People’s Republic of China《中華人民共和國網絡安 ( 全法》) (the “Cyber Security Law”), network operators are generally obligated to protect their networks against disruption, damage or unauthorised access, and to prevent data leakage, theft or tampering. In addition, they will also be subject to specific rules depending on their classification under the multi-level network security protection scheme. With respect to personal information protection, the Cyber Security Law requires network operators not to disclose, tamper with or damage personal information collected or generated in the business operation, and they are obligated to delete unlawfully collected information and to amend incorrect information. In addition, network operators may not collect, use or provide personal information to others without consent. Moreover, the Provisions on Protection of Personal Information of Telecommunication and Internet Users《電信和互聯網用戶個人信息保護規定》 ( )is the specialised regulation governing the collection and use of personal information of users in the provision of telecommunication service and Internet information services. These laws and regulations are relatively new and evolving, and their interpretation and enforcement involve significant uncertainties. The evolving PRC regulations regarding (i) data collection, usage and transfer; and (ii) cyber security may lead to future restrictions and the establishment of new regulatory agencies, and we may bear more legal responsibilities and compliance costs, which may have an adverse effect on our prospects. If security measures are breached because of third-party action, employee error, malfeasance or otherwise, or if design flaws in our technology infrastructure are exposed and exploited, our reputation and brands could be severely damaged and we could incur significant liability, and our business, financial condition and results of operations could be adversely affected.

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We are exposed to risks associated with the use of third-party online payment platforms.

We accept payments via various methods, including but not limited to online payments through third-party platforms. Transactions conducted through third-party platforms involve the transmission of confidential information such as credit card numbers, personal information and billing addresses over public networks. In recent years, the use of third-party platforms in the PRC has grown in parallel with consumer confidence in their security and efficiency. However, we do not have control over the security measures taken by providers of our 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 service fees. We may also be perceived as partially responsible for failures to secure personal information and be subjected to claims alleging possible liability brought by the customers. Such legal proceedings could damage our reputation and materially and adversely affect our business, financial condition and results of operations. In addition, the PRC Government may yet promulgate new laws and policies to regulate the use of third-party online payment platforms. Such measures may increase our compliance and operational costs, for example by requiring that we pay higher transaction fees.

Our value-added services through our online platforms may fail to provide satisfactory services, which may not be able to attract and retain sufficient interest from property owners and residents.

We aim to expand the functionality of our online service platforms, such as our Xiaohui Dangjia App and WeChat mini mobile applications, to increase accessibility and improve user experience and plan to attract further use by residents and tenants of the properties we manage. However, our online service platforms are relatively new and still evolving and we cannot assure you that we will be able to grow these platforms as planned. There can be no assurance that property owners, residents and tenants will respond favourably to them. If our online service platforms fail to provide satisfactory services and products that attract and retain sufficient interest of property owners, residents and tenants as planned, they may cease using such service platforms. In such event, we will not be able to successfully develop our community value-added services or introduce more revenue-generating value-added and other services through our online service platforms. Moreover, we may also encounter technical problems, security issues that may prevent our platform from functioning properly and our users from receiving desired services, and our business, financial condition and results of operations could be adversely affected.

Our success depends on the retention of our senior management team and our ability to attract and retain qualified and experienced employees.

Our continued success depends on the efforts of our senior management team and other key employees. As they possess key connections and industry expertise, losing their services may have a material adverse effect on our business. We believe that their experience with commercial operational service as well as insight into and knowledge of our industry, business operations and history have guided and will continue to guide us toward success. We believe that their expertise will help us compete more effectively. For further details on our Directors and senior management, see the section headed “Directors and Senior Management” in this document. If one or more members of our senior management or our key employees are unable

–46– 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 or unwilling to continue their employment with us, we may not be able to replace them with qualified personnel in a timely manner, or at all, which may result in material adverse changes to our established brand image, reputation, service quality or standards, and in turn, may disrupt our business and materially and adversely affect our business, financial condition and results of operations.

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

We are exposed to fraud, negligence or other misconduct, intended or unintended, committed by our employees, subcontractors, agents, customers or other third parties that could subject us to financial losses and sanctions imposed by governmental authorities as well as seriously harm our reputation. We cannot assure you that our risk management and internal control systems will always enable us to detect, prevent and take remedial measures in relation to fraud, negligence or other misconduct committed by our employees, third-party subcontractors or other third parties in a timely and effective manner. Examples of such behaviour include crimes such as theft, vandalism and bribery during tenders.

Although we have limited control over the behaviour of any of these parties, we may be viewed as at least partially responsible for their conduct on contractual or tortious grounds or suffer loss as a result of their misconducts. 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 other third parties. In the event that we cannot recover related costs from the employees, third-party subcontractors or other third parties involved in the misconducts, our business, financial condition and results of operations could be materially and adversely affected. Such misconducts could also attract negative publicity on our Group, damaging our reputation and brand value.

Our employees and third-party subcontractors may sustain work injuries during the ordinary course of providing commercial operational services and property management services, which may exposes us to liability and reputation risk.

Work injuries may occur during the ordinary course of our business. For example, repair and maintenance services performed by our employees or subcontractors may involve the handling of tools and machinery that carry the inherent occupational risk of accidents. Hence, 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 and third-party subcontractors. Such occurrences may also damage our reputation within the commercial operational service market and property management service market. We may also experience business disruptions and be required to implement additional safety measures or modify our business model as a result of any governmental or other investigations. As a result, our business, financial condition, results of operations could be materially and adversely affected.

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Our prospects may be adversely affected by COVID-19 pandemic or other adverse public health developments.

An outbreak of respiratory illness caused by a novel coronavirus, namely COVID-19, was identified in late 2019 and spread globally in over 200 countries and territories. In March 2020, the World Health Organisation characterised the outbreak of COVID-19 a pandemic. The accelerated spread of the virus globally has caused extreme volatility in the global financial markets. For example, China experienced a slower-than-usual growth of 2.3% in its GDP in 2020, as compared to 6.0% in 2019, which was the biggest contraction since its GDP records began. The COVID-19 pandemic has had an adverse impact, and may continue to cause adverse impacts in the long-term, on the economy and social conditions in China and other affected countries, and this may have an adverse impact on the PRC property development and management industries and adversely affect our business operations. For example, to comply with the requirements of local governments with respect to community management during the outbreak of the COVID-19 pandemic, we assigned personnel to conduct visitor control for properties under our management. The COVID-19 pandemic has a relatively direct impact on the commercial properties operated by us from the aspects such as tenant sourcing, rent collection rate and whether the commercial property is allowed to open. While the COVID-19 pandemic appears to be contained in China for the time being, international travels and business activities have been substantially reduced which may have a material adverse impact on the Chinese economy. We are uncertain as to when the COVID-19 pandemic will be contained globally or whether it may resurge in China, and we also cannot predict whether COVID-19 pandemic will have a long-term impact on our business operations. If we are not able to effectively and efficiently operate our business and implement our strategies as planned, we may not be able to grow our business and generate revenue as anticipated, and our business operations, financial condition and prospects may be materially and adversely affected.

In addition, in order to comply with government regulations and measures to combat the COVID-19 pandemic, we assigned additional staff and incurred additional medical and sterilisation material costs. Furthermore, the health of many of our staff is exposed to a higher risk of infection with COVID-19 due the client-facing nature of their duties. If the scale of COVID-19 pandemic escalates and further government regulation and measures to combat the COVID-19 pandemic are implemented, we may incur additional cost of operations in terms of human resources arrangement and purchase of medical materials and our results of operations and financial performance could be negatively affected.

Please refer to the section headed “Business—Effect of the COVID-19 Pandemic” in this document.

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 that some of our lease agreements have not been filed with the relevant PRC authorities and, as a result, we might be subject to administrative fines.

During the Track Record Period, we leased properties in various locations in the PRC for use primarily as office spaces and employee dormitories. As at the Latest Practicable Date, we had not completed the administrative filings of five lease agreements relating to properties we leased. According to applicable PRC regulations, the lessor and the lessee of a lease agreement

–48– 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 are required to file the lease agreement with relevant governmental authorities within 30 days after the execution of the lease agreement. If the filing is not made, the governmental authorities may require that the filing be made within a stated period of time, failing which they may impose a fine ranging from RMB1,000 to RMB10,000 for each agreement that has not been properly filed. According to applicable PRC regulations, lessors of the related leases need to provide us with certain documents (such as their business licences or identification information) in order to complete the administrative filing. There can be no assurance that the lessors of our leased properties will be cooperative in the process of completing the filings. If we fail to complete the administrative filings within the period required by the relevant governmental authorities and relevant authorities determine that we shall be liable for failing to complete the administrative filings of all the relevant lease agreements, we might be subject to fines. Please refer to the section headed “Business—Properties” in this document.

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

We are required to obtain governmental approvals in the form of permits, licences and certificates to provide our services. 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. In addition, the PRC Government and relevant authorities may 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, licences 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, licences and certificates could result in disruption to our business operations, potentially leading to material adverse effects on our business and results of operations.

We may fail to effectively protect our intellectual property rights or conversely, we may subject to claims by third parties alleging possible infringement of their intellectual property rights.

We rely on our trade name and trademarks to build brand value and recognition, which we believe are key to our future growth and for fostering customer loyalty. Unauthorised use or infringement of our trade names or trademarks may impair our brand value and recognition. Third parties may use our intellectual property in ways that damage our reputation in the commercial operational and property management service market. We primarily rely on a combination of copyrights, trademarks, confidentiality agreements and domain name registrations to protect our intellectual property rights. We cannot assure you that our measures to protect our intellectual property will be sufficient and that we will be able to detect all misappropriation or unauthorised use of our trade name and trademarks in a timely manner, or at all. There is also no guarantee that we will be successful in any enforcement proceedings that we undertake. Litigation to protect our intellectual property may be time-consuming, costly and divert management attention from our operations. While experiencing material adverse effects on our business and financial condition, failures to protect our intellectual property rights may also diminish our competitiveness and market share.

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Conversely, we may 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 licences from third parties and pay ongoing royalties on unfavourable terms. In addition, 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. As a result, our business, financial condition and results of operations could be materially and adversely affected.

We may be subject to additional tax liabilities and adverse tax consequences as a result of tax adjustment.

As at 31 December 2018, 2019 and 2020, we had income tax liabilities of RMB1.8 million, RMB1.7 million and RMB8.9 million, respectively. Income tax liabilities as at the specified dates mainly represented the income tax payable for the year then ended according to the prevailing income tax rate. Historically, we recorded revenues upon the settlement of invoices with customers, and recorded relevant cost of sales and other operating expenses when we made the payments to suppliers or employees. We subsequently made adjustments to record revenues when services were rendered to customers, and to record relevant cost of sales and other operating expenses when they were incurred in accordance with applicable HKFRSs. Please refer to the section headed “Financial Information—Description of Certain Combined Balance Sheet Items—Income Tax Liabilities” in this document for further information. As a result, we made an one-off tax adjustment in the amount of RMB1.6 million mainly in relation to the timing difference in tax computation of 2018, 2019 and 2020 for EIT, VAT and our tax surcharge, which was fully settled in June 2021.

However, the final determination of the relevant tax authorities could be different and we may face adverse tax consequences if any of the relevant tax authorities determine that we have not fully or timely paid our taxes for the Track Record Period or any prior periods. Under applicable PRC laws and regulations, the relevant PRC authorities may demand that we pay the outstanding tax within a prescribed 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 within a prescribed time period, we may be subject to a fine of 50% to five times the amount of the outstanding tax payments. Any of these additional tax liabilities or adverse tax consequences could have a material adverse effect on our business, financial position and results of operations.

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 labour 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 labour 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 labour 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

–50– 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 satisfying all relevant environmental and safety requirements. If we are unable to comply with existing or future environmental, health and labour 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.

Fluctuations in amounts of tax benefits or government grants may lead to volatility in our profit.

We enjoy favourable treatment from government authorities in respect of, among other things, tax benefits and government grants to support local corporate and economic development and to encourage our effort of stabilising employment. Certain of our subsidiaries in the PRC are located in Chongqing, which are subject to a preferential income tax rate of 15%. Our government grants amounted to RMB0.2 million, RMB0.5 million and RMB1.5 million, or 1.1%, 1.5% and 2.8% of our profit for the year ended 31 December 2018, 2019 and 2020, respectively. Tax benefits and government grants fluctuated during the Track Record Period because such benefits and grants were subject to the government policy in that year or period. There can be no assurance that we will continue to receive significant amounts of tax benefits or government grants, or at all. Accordingly, we may experience additional fluctuations in our tax benefits and government grants, which may lead to volatility in our profit.

In addition, the implementation of favourable policies《關於階段性減免企業社會保險費的 ( 通知》（人社部發[2020]11號）) as a result of the COVID-19 outbreak for the reduction and waiver of social insurance contribution contributed to the decrease in our staff costs in 2020 as compared with 2019. If we do not enjoy such favourable policies in the future, our cost of sales may increase and gross profit margin may be negatively affected. Moreover, during the Track Record Period, Funeng Ronghui, our joint venture received government grants of RMB0.9 million, RMB6.6 million and RMB5.9 million for 2018, 2019 and 2020, respectively. With these government grants, Funeng Ronghui was able to maintain profitable during the Track Record Period with relatively low management fee for its government projects. 2021 is the last year for the current government grants arrangement provided to Funeng Ronghui. There can be no assurance that Funeng Ronghui will continue to receive government grants at such level, or at all. In addition, if Funeng Ronghui receives government grants at a lower level or ceases to receive any government grants in the future, there can be no guarantee that Funeng Ronghui can successfully increase its management fees or diversify its revenue source. Accordingly, our share of results of the joint venture may be negatively affected.

Our insurance coverage may not sufficiently cover the risks related to our business.

We purchase and maintain insurance policies that we believe are customary with the standard commercial practice in our industry and as required under the relevant laws and regulations. For further details on the insurance policies we maintain, please refer to the section headed “Business—Insurance” in this document. However, we cannot assure you that our insurance policies will provide adequate coverage for all the risks in connection with our business operations. Consistent with customary practice in the PRC, we do not carry any business interruption insurance or litigation insurance. In addition, insurance policies against disruption or damage caused by instances such as natural disasters, wars, civil unrest and acts of terrorism are not available in the PRC on commercially practicable terms. We may be required to bear our losses to the extent that our insurance coverage is insufficient. If we were to incur substantial losses and liabilities that are not covered by our insurance policies, we could suffer significant costs and diversion of our resources, and thereby materially and adversely affecting our business, financial condition and results of operations.

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We are subject to risks beyond our control relating to natural disasters, epidemics, acts of terrorism or wars, and other disasters in the PRC and globally.

Our business is subject to general economic and social conditions in the PRC. The outbreak of any severe diseases in China such as the human swine flu, also known as Influenza A (H1N1), H5N1 avian flu or severe acute respiratory syndrome (“SARS”) or COVID-19, and other natural disasters which are beyond our control may adversely affect the economy, infrastructure and livelihood of the people in the PRC, which in turn may adversely impact domestic consumption and our business. Some regions in the PRC, including certain cities where we operate, are under the threat of flood, earthquake, sandstorm, snowstorm, fire, drought or epidemics. Our business, financial position and results of operations may be materially and adversely affected if natural disasters or other such events occur. China has experienced natural disasters, including earthquakes, floods, landslides and droughts in the past, resulting in deaths of people, significant economic losses and significant and extensive damage to factories, power lines and other properties, as well as blackouts, transportation and communications disruptions and other losses in the affected areas. Furthermore, the PRC reported a number of cases of SARS in 2003. Since its outbreak in 2004, there have been reports on occurrences of avian flu in various parts of the PRC, including several confirmed human cases and deaths. The outbreak of COVID-19 pandemic has resulted in numerous confirmed cases and deaths both in China and globally. Any future outbreak of SARS, COVID-19, avian flu or other similar adverse epidemics may, among others, significantly disrupt our business. Any such natural disasters or outbreak of infectious disease may cause a shortage of labour and raw materials, increase cost to our existing property management projects, which would disrupt our operations and have a material adverse impact on our business, financial condition and results of operations. Our operations could also be disrupted if any of our employees were suspected of contracting or contracted an epidemic disease, since this could require us to quarantine some or all of our employees and disinfect the venues for our business operations. Any such natural disasters, public health and public security hazards may materially and adversely affect or disrupt our business operations and may also severely affect and restrict the level of economic activity in the affected areas, which in turn may have a material and adverse effect on our business, financial position and results of operations.

Our reputation may be adversely affected by customer complaints relating to services provided by our Group even if they may be frivolous or vexatious.

Our customers may file complaints or claims against our Group regarding our services. Our customers are largely individual property owners and residents who come from all walks of life and may have different expectations on how their properties and neighbourhoods should be managed. As a result, during our ordinary course of business, we need to maintain a balance among these varying expectations.

Although we have established quality control procedures for our services and maintained communication channels for customer feedbacks and complaints, we cannot assure you that all property owners’ and residents’ expectations and demands can be addressed in a timely and effective manner. We also cannot 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, we cannot guarantee that, in order to compel us

–52– 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 meet these demands, such property owners and residents will not attempt to exert pressure by means beyond our control, such as lodging or making frivolous or vexatious complaints to us. 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 trading price of our Shares.

The elevators we operate may fail to pass inspection.

We operate elevators in the properties we provide property management services and commercial operational services. Elevators are categorised as special equipment under the Regulations on Safety Supervision over Special Equipment and the production, use and inspection of elevators are subject to the supervision of relevant authorities. We currently rely on third party sub-contractors with necessary permits and licences for the repair and maintenance of the elevators we operate. However, we cannot assure you that the elevators we operate can pass all the required inspections and obtained or renew all the necessary use certificates. If we fail to obtain or renew all necessary use certificates for the elevators we operate, the services we provide may be interrupted and out business operations and financial performance may be adversely affected.

We may not have the ability to compel our joint venture to take all actions which we believe would be most beneficial for us, and disputes with our joint venture partners may materially and adversely affect our business.

During the Track Record Period and as at the Latest Practicable Date, we had 50% equity interest in Funeng Ronghui, our joint venture, which we shared its profit and loss. We may have limited control over the proposed strategies, policies or objectives of our joint venture. As a result, our ability to control the decisions of its business depends on a number of factors, including reaching agreement with our joint venture partners, our rights under the joint venture agreement as well as the decision making process applicable to such joint venture. In addition, we are subject to risks associated with such joint venture relationship. Our joint venture partners may:

• have economic or business interests or goals that are inconsistent with ours;

• take actions contrary to our policies, instructions or requests;

• fail to fulfil their obligations under the joint venture agreement; or

• have financial or other difficulties.

We cannot assure you that we will be able to prevent our joint venture from engaging in activities or pursing strategic objectives that conflict with our own interests or strategic objectives or compete with our business. In addition, any serious dispute with our joint venture partners may cause disruption to or termination of the relevant business ventures or other cooperative projects. Although we have not had a serious dispute with any joint venture partners and we are not aware of any action taken by any of our joint venture partners that were materially adverse to us during the Track Record Period, we cannot assure you that all disputes with our joint venture partners may be resolved satisfactorily or in our favour. Such disputes

–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 give rise to litigation or other legal proceedings, which will divert our management’s attention and other resources, and if a verdict or award is rendered against us, we could be required to pay significant monetary damages, assume other liabilities, and suspend or terminate the related joint venture projects. Consequently, our business, financial condition and results of operations may be materially and adversely affected.

RISKS RELATING TO DOING BUSINESS IN THE PRC

We are subject to adverse changes in economic, political and social conditions and government policies in the PRC.

A large portion of our major businesses, assets, operations are located in the PRC. Accordingly, our financial condition, results of operations and prospects are, to a significant degree, subject to the economic, political, social and legal conditions in the PRC. The PRC economy differs from that of most developed countries in many respects, including the extent of government involvement, level of economic development, investment control, resource allocation, growth rate and control over foreign exchange. Before its adoption of reform and opening-up policies beginning in 1978, the PRC was primarily a planned economy. Since then, the PRC economy has been transitioning to become a market economy with socialist characteristics.

For approximately four decades, the PRC Government has implemented economic reform measures to utilise market forces in the PRC economy. Many of the reform measures are unprecedented or experimental and are likely to be modified from time to time. Other political, economic and social factors may lead to further readjustment or introduction of other reform measures. This reform process and any changes in laws and regulations or the interpretation or implementation thereof in the PRC may have a material impact on our operations or may adversely affect our financial condition and results of operations.

While the PRC economy has grown significantly in recent years, this growth has been geographically uneven among various sectors of the economy and during different periods. We cannot assure you that the PRC economy will continue to grow, or that if there is growth, such growth will be steady and uniform. Any economic slowdown may materially and adversely affect our business. In the past, the PRC Government has periodically implemented a number of measures intended to slow down certain segments of the economy which the PRC Government believed was overheating. We cannot assure you that the various macroeconomic measures and monetary policies adopted by the PRC Government to guide economic growth and allocate resources will be effective in improving the growth rate of the PRC economy. In addition, such measures, even if they benefit the overall PRC economy in the long term, may reduce demand for our services and therefore could materially and adversely affect our business, financial condition and results of operations.

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Restrictions on currency exchange under PRC laws and regulations may limit our ability to satisfy obligations denominated in foreign currencies.

Currently, the Renminbi cannot be freely converted into foreign currencies, and the conversion and remittance of foreign currencies are subject to PRC foreign exchange regulations. All of our revenue is denominated in Renminbi. Under our current corporate structure, we derive our income primarily from dividend payments made by our PRC subsidiaries. Shortages in the availability of foreign currency may restrict the ability of our PRC subsidiaries to pay dividends or other payments to us or satisfy other foreign currency-denominated obligations, if any.

Under existing PRC foreign exchange regulations, the Renminbi is convertible without prior approval from the SAFE for current account transactions so long as certain procedures are complied with. Examples of such current account transactions include profit distributions and interest payments. However, prior approval and registration with the SAFE is required for capital account transactions. Examples of capital account transactions include foreign direct investment and the repayment of loan principal. We cannot assure you that the PRC Government, in seeking to regulate the economy, will not restrict access to foreign currencies for current account transactions in the future. Such restrictions may limit our ability to convert cash from our operating activities into foreign currencies to make dividend payments or satisfy any foreign currency-denominated obligations we may have. Moreover, limitations on the flow of funds between us and our PRC subsidiaries may restrict our ability to provide financing to our PRC subsidiaries and take advantage of business opportunities in response to market conditions.

Fluctuations in exchange rates may have a material adverse impact on your investment.

The exchange rate of the Renminbi fluctuates against the Hong Kong dollar, U.S. dollar and other foreign currencies and is affected by, among other factors, the policies of the PRC Government and changes in international and domestic political and economic conditions. From 1995 to 20 July 2005, the conversion of the Renminbi into foreign currencies was based on fixed rates set by the PBOC. However, effective from 21 July 2005, the PRC Government decided to permit the Renminbi to fluctuate within a regulated band based on market supply and demand and by reference to a basket of currencies. On 30 November 2015, the Executive Board of the International Monetary Fund completed a regular five-year review of the basket of currencies that make up the Special Drawing Right and determined that, effective from 1 October 2016, the Renminbi will be included in the Special Drawing Right basket as a fifth currency along with the U.S. dollar, the Euro, the Japanese yen and the British pound. It is difficult to predict how market forces and the PRC Government’s policies will continue to impact Renminbi exchange rates going forward. In light of the trend towards Renminbi internationalisation, the PRC Government may announce further changes to the exchange rate system, and we cannot assure you that the Renminbi will not appreciate or depreciate significantly in value against the Hong Kong dollar, U.S. dollar or other foreign currencies.

All of our revenue and liabilities and assets are denominated in Renminbi, while our [REDACTED]fromthe[REDACTED] will be denominated in Hong Kong dollars. Material fluctuations in the exchange rate of the Renminbi against the Hong Kong dollar may negatively impact the value and amount of any dividends payable on our Shares. For example, significant

–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 appreciation of the Renminbi against the Hong Kong dollar could reduce the amount of Renminbi received from converting [REDACTED]or[REDACTED] from future financing efforts to fund our operations. Conversely, significant depreciation of the Renminbi may increase the cost of converting our Renminbi-denominated cash flow into Hong Kong dollars, thereby reducing the amount of cash available for paying dividends on our Shares or carrying out other business operations.

Inflation in the PRC could negatively affect our profitability and growth.

Economic growth in the PRC 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. We cannot assure you 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 services.

Uncertainties with respect to the PRC legal system could limit the legal protection available to you.

The legal system in the PRC has inherent uncertainties that could limit the legal protection available to our Shareholders. As we conduct the majority of our business operations in the PRC, we are principally governed by PRC laws, rules and regulations. The PRC legal system is based on the civil law system. Unlike the common law system, the civil law system is established on the written statutes and their interpretation by the Supreme People’s Court (最高人民法院), while prior legal decisions and judgements have limited significance as precedent. Additionally, such PRC written statutes are often principle-oriented and required detailed interpretations by the enforcement bodies for further application and enforcement. The PRC Government has been learning from the common law system, and has made significant progress in promulgating laws and regulations related to economic affairs and matters, such as corporate organisation and governance, foreign investments, commerce, taxation and trade.

However, many of these laws and regulations are relatively new and there is a limited volume of published decisions. Thus, there are uncertainties involved in their implementation and interpretation, which might not be as consistent and predictable as in other jurisdictions. In addition, the PRC legal system is based in part on government policies and administrative rules that may have retroactive effect. Consequently, we may not be aware of any violation of these policies and rules until sometime after such violation has occurred. Furthermore, the legal protection available to you under these laws, rules and regulations may be limited. Any litigation or regulatory enforcement action in the PRC may be protracted and result in substantial costs and diversion of resources and management attention.

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You may experience difficulties in effecting service of process or enforcing foreign judgements against us, our Directors or senior management residing in the PRC.

Our Company was incorporated in the Cayman Islands. Substantially all of our assets are located in the PRC and most of our Directors and senior management reside in the PRC. Therefore, it may not be possible to effect service of process within Hong Kong or elsewhere outside of the PRC upon us or our Directors or senior management. Moreover, the PRC has not entered into treaties for the reciprocal recognition and enforcement of court judgements with Japan, the United Kingdom, the United States and many other countries. As a result, recognition and enforcement in the PRC of a court judgement obtained in other jurisdictions may be difficult or impossible.

In addition, Arrangement on Reciprocal Recognition and Enforcement of Judgments in Civil and Commercial Matters by the Courts of the Mainland and of the Hong Kong Special Administrative Region Pursuant to Choice of Court Agreements between 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) or the Arrangement, was promulgated by the Supreme People’s Court on July 3, 2008 and became effective on 1 August 2008. Pursuant to the Arrangement, a party with a final court judgement 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 judgement in the PRC. Similarly, a party with a final judgement 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 judgement 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 judgement 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 difficult or impossible for investors to enforce a Hong Kong court judgement against our assets or our Directors or senior management in the PRC.

We may be deemed a PRC resident enterprise under the EIT law and be subject to a tax rate of 25% on our global income.

Pursuant to the EIT Law, which came into effect on 1 January 2008 and was amended on 24 February 2017 and 29 December 2018, an enterprise established outside the PRC whose “de facto management body” is located in the PRC is considered a “PRC resident enterprise” and will generally be subject to the uniform enterprise income tax rate, or EIT rate, of 25% on its global income. Under the implementation rules of the EIT Law, “de facto management body” is defined as the organisational body that effectively exercises management and control over such aspects as the business operations, personnel, accounting and properties of the enterprise.

On 22 April 2009, the SAT released the Notice Regarding the Determination of Chinese-Controlled Offshore Incorporated Enterprises as PRC Tax Resident Enterprises on the Basis of De Facto Management Bodies《關於境外註冊中資控股企業依據實際管理機構標準認定為 ( 居民企業有關問題的通知》) or Circular 82, as amended on 29 December 2017, which sets out the standards and procedures for determining whether the “de facto management body” of an enterprise registered outside of the PRC and controlled by PRC enterprises or PRC enterprise

–57– 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 groups is located within the PRC. Under Circular 82, a foreign enterprise controlled by a PRC enterprise or PRC enterprise group is considered a PRC resident enterprise if all of the following apply: (i) the senior management and core management departments in charge of daily business operations are located mainly within the PRC; (ii) financial and human resources decisions are subject to determination or approval by persons or bodies in the PRC; (iii) major assets, accounting books, company seals and minutes and files of board and shareholders’ meetings are located or kept within the PRC; and (iv) at least half of the enterprise’s directors with voting rights or senior management reside within the PRC. In addition, Circular 82 also requires that the determination of “de facto management body” shall be based on the principle that substance is more important than form. Further to Circular 82, SAT issued the Chinese-Controlled Offshore Incorporated Resident Enterprises Income Tax Regulation (Trial Implementation) (《境外註冊中資控股居民企業所得稅管理辦法(試行)》) or Bulletin 45, which took effect on 1 September 2011 and was amended on 1 June 2015, 1 October 2016 and 15 June 2018, to provide more guidance on the implementation of Circular 82 and clarify the reporting and filing obligations of such “Chinese-controlled offshore incorporated resident enterprises.” Bulletin 45 provides procedures and administrative details for the determination of resident status and administration of post-determination matters. Although Circular 82 and Bulletin 45 explicitly provide that the above standards apply to enterprises which are registered outside of the PRC and controlled by PRC enterprises or PRC enterprise groups, Circular 82 may reflect the SAT’s criteria for determining the tax residence of foreign enterprises in general. All members of our senior management are currently based in the PRC. If we are deemed a PRC resident enterprise, the EIT rate of 25% on our global taxable income may reduce capital we could otherwise divert to our business operations.

You may be subject to PRC income tax on dividends from us or on any gain realised on the transfer of our Shares under PRC laws.

Under the EIT Law and its implementation rules, subject to any applicable tax treaty or similar arrangement between the PRC and your jurisdiction of residence that provides for a different income tax arrangement, PRC withholding tax at the rate of 10% is normally applicable to dividends from PRC sources payable to investors that are non-PRC resident enterprises, which do not have an establishment or place of business in the PRC, or which have such establishment or place of business if the relevant income is not effectively connected with the establishment or place of business. Any gains realised on the transfer of shares by such investors are subject to a 10% PRC income tax rate if such gains are regarded as income from sources within the PRC unless a treaty or similar arrangement provides otherwise. Under the PRC Individual Income Tax Law《中華人民共和國個人所得稅法》 ( ) and its implementation rules, dividends from sources within the PRC paid to foreign individual investors who are not PRC residents are generally subject to a PRC withholding tax at a rate of 20% and gains from PRC sources realised by such investors on the transfer of shares are generally subject to a 20% PRC income tax rate, in each case, subject to any reduction or exemption set forth in applicable tax treaties and PRC laws.

Although the majority of our business operations are in the PRC, it is unclear whether dividends we pay with respect to our Shares, or the gain realised from the transfer of our Shares, would be treated as income from sources within the PRC and as a result be subject to PRC income tax if we are considered a PRC resident enterprise. If PRC income tax is imposed on gains realised from the transfer of our Shares or on dividends paid to our non-PRC resident

–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 investors, the value of your investment in our Shares may be materially and adversely affected. Furthermore, our Shareholders whose jurisdictions of residence have tax treaties or arrangements with the PRC may not qualify for benefits under such tax treaties or arrangements.

We rely on dividends paid by our subsidiaries for our cash needs, and any limitation on the ability of our subsidiaries to make payments to us could have a material adverse effect on our ability to conduct our business.

We conduct all of our business through our combined subsidiaries incorporated in China. We rely on dividends paid by these combined subsidiaries for our cash needs, including the funds necessary to pay any dividends and other cash distributions to our Shareholders, to service any debt we may incur and to pay our operating expenses. The payment of dividends by entities established in China is subject to limitations. Regulations in China currently permit payment of dividends only out of accumulated profits as determined in accordance with accounting standards and regulations in China. Each of our PRC subsidiaries is also required to set aside at least 10% of its after-tax profit based on PRC laws and regulations each year to its statutory capital reserve fund until the aggregate amount of such reserves reaches 50% of its respective registered capital. Our statutory reserves are not distributable as loans, advances or cash dividends. We anticipate that in the foreseeable future our PRC subsidiaries will need to continue to set aside 10% of their respective after-tax profits to their statutory reserves. In addition, if any of our PRC subsidiaries incurs debt on its own behalf in the future, the instruments governing the debt may restrict its ability to pay dividends or make other distributions to us. Any limitations on the ability of our PRC subsidiaries to transfer funds to us could materially and adversely limit our ability to grow, make investments or acquisitions that could be beneficial to our business, pay dividends and otherwise fund and conduct our business.

Regulations relating to offshore investment activities by PRC residents may subject us to fines or sanctions imposed by the PRC government, including restrictions on the ability of our PRC subsidiaries to pay dividends or make distributions to us and our ability to increase our investment in our PRC subsidiaries.

The SAFE promulgated the Circular of the SAFE on Issues concerning Foreign Exchange Administration of the Overseas Investment and Financing and the Round-tripping Investment Made by Domestic Residents through Special-Purpose Companies《國家外匯管理局關於境內居 ( 民通過特殊目的公司境外投融資及返程投資外匯管理有關問題的通知》) or Circular 37, in July 2014, which abolished and superseded the Circular on Relevant Issues Concerning Foreign Exchange Administration for PRC Residents to Engage in Financing and Round Trip Investment via Overseas Special Purpose Vehicles《關於境內居民通過境外特殊目的公司融資及返程投資外匯管 ( 理有關問題的通知》). Pursuant to Circular 37 and its implementation rules, PRC residents, including PRC institutions and individuals, must register with local branches of the SAFE in connection with their direct or indirect offshore investments in an overseas special purpose vehicle, or SPV, directly established or indirectly controlled by PRC residents for the purposes of offshore investment and financing with their legally owned assets or interests in domestic enterprises, or their legally owned offshore assets or interests or any inbound investment through SPVs. Such PRC residents are also required to amend their registrations with SAFE when there is change to the required information of the registered SPV, such as changes to its

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PRC resident individual shareholder, name, operation period or other basic information, or the PRC individual resident’s increase or decrease in its capital contribution in the SPV, or any share transfer or exchange, merger or division of the SPV. In accordance with the Notice of the SAFE on Further Simplifying and Improving Policies for the Foreign Exchange Administration of Direct Investment《國家外匯管理局關於進一步簡化和改進直接投資外匯管理政策的通知》 ( ), the foreign exchange registration aforesaid has been directly reviewed and handled by banks since 1 June 2015, and the SAFE and its branches perform indirect regulation over such foreign exchange registration through local banks. Under this regulation, failure to comply with the registration procedures set forth in Circular 37 may result in restrictions being imposed on the foreign exchange activities of our PRC subsidiaries, including the payment of dividends and other distributions to its offshore parent or affiliate, the capital inflow from the offshore entities and its settlement of foreign exchange capital, and may also subject the relevant onshore company or PRC residents to penalties under PRC foreign exchange administration regulations.

We are committed to complying with and ensuring that our Shareholders who are subject to the regulations will comply with the relevant rules. Any future failure by any of our Shareholders who is a PRC resident, or controlled by a PRC resident, to comply with relevant requirements under this regulation could subject us to penalties or sanctions imposed by the PRC Government. However, we may not at all times be fully aware or informed of the identities of all of our Shareholders who are PRC residents, and we may not always be able to timely compel our Shareholders to comply with the requirements of Circular 37. Moreover, we cannot assure you that the PRC Government will not have a different interpretation of the requirements of Circular 37 in the future.

PRC laws and regulations establish more complex procedures for some acquisitions of PRC companies by foreign investors, which could make it difficult for us to pursue growth through acquisitions in the PRC.

A number of PRC laws and regulations, including the M&A Rules, the Anti-Monopoly Law《反壟斷法》 ( ), and the Rules of the MOFCOM on Implementation of Security Review System of Mergers and Acquisitions of Domestic Enterprises by Foreign Investors《商務部實施外國投資 ( 者併購境內企業安全審查制度的規定》) promulgated by the MOFCOM on 25 August 2011 and effective from 1 September 2011 or the Security Review Rules, have established procedures and requirements that are expected to make the review of certain merger and acquisition activities by foreign investors in the PRC more time-consuming and complex. These include requirements in some instances to obtain approval from local offices of the MOFCOM in advance of any transaction in which foreign investors take control of a PRC domestic enterprise, or to obtain approval from the MOFCOM before overseas companies established or controlled by PRC enterprises or residents acquire affiliated domestic companies. PRC laws and regulations also require certain merger and acquisition transactions to be subject to merger control or security review.

The Security Review Rules prohibits foreign investors from bypassing the security review requirement by structuring transactions through proxies, trusts, indirect investments, leases, loans, control through contractual arrangements or offshore transactions. If we are found to be in violation of the Security Review Rules and other PRC laws and regulations with respect to merger and acquisition activities in the PRC, or fail to obtain any of the required approvals, the relevant regulatory authorities would have broad discretion in dealing with such violations,

–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 including levying fines, revoking business and operating licences, confiscating our income and requiring us to restructure or unwind our restructuring activities. Any of these actions could cause significant disruption to our business operations and could materially and adversely affect our business, financial condition and results of operations. Furthermore, if the business of any target company we plan to acquire falls into the ambit of security review, we may not be able to successfully acquire such company either by equity or asset acquisition, capital contribution or any contractual arrangement. We may grow our business in part by acquiring other companies operating in our industry. Complying with the requirements of the relevant regulations to complete such transactions could be time-consuming, and any required approval processes, including approval from the MOFCOM, may delay or inhibit our ability to complete such transactions, thus affecting our ability to expand our business or maintain our market share.

We are subject to the regulatory environment and measures affecting the PRC property management and real estate industries.

Our operations are affected by the regulatory environment and measures affecting the property management industry in the PRC. In particular, the fees that property management companies may charge in connection with property management services are subject to regulation and supervision by relevant regulatory authorities in the PRC. For example, the relevant price administration department and construction administration department of the State Council are jointly responsible for the supervision over and administration of fees charged in relation to property management services for preliminary property management service contracts and such fees may need to follow PRC government guidance prices. Although government-imposed price controls on property management fees may continue to relax over time pursuant to the Circular of the National Development and Reform Commission on Relaxing Price Controls in Certain Services (國家發展改革委關於放開部分服務價格意見的通知) (發改價格[2014]2755號), which became effective on 17 December 2014, the property management fees we charge, such as those for preliminary property management service contracts, may still need to follow guidance prices imposed by local governments in different regions in China.

In addition, if the property management fees we charge are not ratified by the relevant PRC authorities or otherwise not in compliance with the relevant requirements for government guidance prices, we may be subject to applicable administrative penalties and our property management fees in excess of the guidance price may be confiscated by the relevant PRC authorities. For more information, please refer to the section headed “Business—Property Management Services—Our Pricing Policy” in this document. Government-imposed limits and other regulatory requirement on property management fees could have a negative impact on our earnings. We cannot guarantee that the government regulations on property management fees and other matters concerning the property management industry will not have an adverse effect on our business, financial condition and results of operations, which may be material. In addition, as we expand our business operations into new geographic regions and broaden the range of services we perform, we are subject to an increasing number of provincial and local rules and regulations for various aspects of our business operations. As the size and scope of our operations had increased during the Track Record Period, the difficulty of ensuring compliance with the various local property management regulations and the potential for loss resulting from non-compliance have increased. If we fail to comply with the related local regulations, we may be subject to penalties by the competent PRC authorities. The laws and regulations

–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 applicable to our business, whether national, provincial or local, may also change in ways that materially increase our costs of compliance, and any failure to comply could result in significant financial penalties which could have a material adverse effect on our reputation, business, financial position and results of operations.

Moreover, we may also be affected by the PRC government regulations on the real estate industry. The PRC government had in the past introduced various restrictive measures to discourage speculation in the real estate market and has exerted 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, real estate financing and taxation. Through these policies and measures, 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. Any such governmental regulations and measures may affect the PRC real estate industry, thus limiting our business growth and resulting in a material adverse effect on our business, financial position and results of operations. In particular, the PRC government may introduce other initiatives or implement more stringent measures in the future, such as setting caps on certain debt ratios, with a view to controlling the increase of the debt levels in the real estate sector. Such potential initiatives or measures, once in place, may further limit property developers’ access to capital and slow down the overall growth of the real estate sector and expansion of property developers, including Ronghui Group and/or its associates and joint ventures, which may in turn negatively impact the growth of the property management industry and the supply of new properties for management by property management companies like us. Furthermore, any economic slowdown, recession or other developments in the social, political, economic or legal environment of the PRC could result in fewer new property development projects, or a decline in the purchasing power of residents or tenants of the properties we manage, resulting in lower demand for our services and lower revenue for us. As such, our business, financial condition and results of operations could be materially and adversely affected.

SAFE regulations may limit our ability to finance our PRC subsidiaries effectively with the [REDACTED] from the [REDACTED], which may affect the value of your investment and may make it more difficult for us to pursue growth through acquisitions.

We plan to finance our equity controlled PRC subsidiaries with the [REDACTED]from the [REDACTED] through overseas shareholder loans or additional capital contributions, which require registration with or approvals from PRC Government authorities. Any overseas shareholder loans to our PRC subsidiaries must be registered with the local branch of SAFE as a procedural matter, and such loans cannot exceed a mandatory limitation approved under the relevant PRC laws and based on the elements including their respective registered capital or net asset. In addition, the amounts of the capital contributions are subject to the registration or approval of the Ministry of Commerce in China or its local counterpart. We cannot assure you that we will complete the necessary government registrations or obtain the necessary government approvals on a timely basis, or at all, with respect to making future loans or capital contributions to our PRC subsidiaries with the [REDACTED] from the [REDACTED]. If we fail to complete such registrations or obtain such approvals, our ability to contribute additional capital to fund our PRC operations may be negatively affected, which could adversely and materially affect our liquidity and our ability to fund and expand our business.

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RISKS RELATING TO THE [REDACTED]

There has been no prior market for our Shares, and their liquidity and market price following the [REDACTED] may be volatile.

Prior to the [REDACTED], there was no public market for our Shares. The indicative [REDACTED] and the [REDACTED] will be determined by negotiations between us and the Sole [REDACTED] (on behalf of the [REDACTED]), and they may differ significantly from the market price of our Shares following the [REDACTED].

We have applied to [REDACTED] and [REDACTED] our Shares on the Stock Exchange. However, even if approved, there can be no guarantee that: (i) an active or liquid trading market for our Shares will develop; or (ii) if such a trading market does develop, it will be sustained following completion of the [REDACTED]; or (iii) the market price of our Shares will not decline below the [REDACTED]. The trading volume and price of our Shares may be subject to significant volatility in response to, among others, the following factors:

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

• changes 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;

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

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

• strategic alliances or acquisitions;

• potential litigations or regulatory investigations;

• loss of key personnel;

• changes in laws and regulations that impose limitations on our industry;

• announcements made by us or our competitors;

• changes in pricing adopted by us or our competitors;

• the liquidity of the market for our Shares; and

• general economic and other factors.

–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

Potential investors will experience immediate and substantial dilution as a result of the [REDACTED] and could face dilution as a result of future equity financings.

The [REDACTED] substantially exceeds the per Share value of our net tangible assets after subtracting our total liabilities, and therefore potential investors will experience immediate dilution when they purchase our Shares in the [REDACTED]. If we were to distribute our net tangible assets to our Shareholders immediately following the [REDACTED], potential investors would receive less than the amount they paid for their Shares.

We will comply with Rule 10.08 of the Listing Rules, which specifies that no further Shares or other securities of the Company (subject to certain exceptions) may be issued or form the subject of any agreement to such an issue within six months from the [REDACTED]. However, after six months from the [REDACTED] we may raise additional funds to finance future acquisitions or expansions of our business operations by issuing new Shares or other securities of the Company. As a result, the percentage shareholding of the then Shareholders may be diluted and such newly issued Shares or other securities may confer rights and privileges that have priority over those of the then Shareholders.

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

The price and trading volume of our 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:

• actual or anticipated fluctuations in our results of operations (including variations arising from foreign exchange rate fluctuations);

• news regarding recruitment or loss of key personnel by us or our competitors;

• announcements of competitive developments, acquisitions or strategic alliances in our industry;

• changes in earnings estimates or recommendations by financial analysts;

• potential litigation or regulatory investigations;

• changes in general economic conditions or other developments affecting us or our industry;

• price movements on international stock markets, the operating and stock price performance of other companies, other industries and other events or factors beyond our control; and

• release of [REDACTED] or other transfer restrictions on our issued and outstanding Shares or sales or perceived sales of additional Shares by us, our Controlling Shareholders or other Shareholders.

–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. RISK FACTORS

You should note that the stock prices of companies in the property management industry have experienced wide fluctuations. Such wide market fluctuations may adversely affect the market price of our Shares. In addition, the securities markets have from time to time experienced significant price and volume fluctuations that are not related to the operating performance of particular companies. These market fluctuations may also materially and adversely affect the market price of our Shares.

Future or perceived sales of substantial amounts of our Shares could affect their market price.

The market price of our Shares could decline as a result of future sales of substantial amounts of our Shares or other related securities, or the perception that such sales may occur. Our ability to raise future capital at favourable times and prices may also be materially and adversely affected. Our Shares held by the Controlling Shareholders are currently subject to certain lock-up undertakings, please refer to the section headed “[REDACTED] Arrangements and Expenses” in this document. However, we cannot assure you that following the expiration of the lock-up periods, these Shareholders will not dispose of any Shares. We cannot predict the effect of any future sales of the Shares by any of our Shareholders on the market price of our Shares.

We may not declare dividends on our Shares in the future.

Any declaration of dividends will be proposed by our Board of Directors, and the amount of any dividends will depend on various factors, including, without limitation, our results of operations, financial condition, capital requirements and surplus, contractual restrictions, future prospects and other factors which our Board of Directors may determine are important. Please refer to the section headed “Financial Information—Dividend Policy and Distributable Reserve” in this document for details. We cannot guarantee when, if and in what form dividends will be paid. Our historical dividend policy should not be taken as indicative of our dividend policy in the future.

Investors may experience difficulties in enforcing their Shareholder rights under Cayman Islands law as the protection afforded to minority shareholders under Cayman Islands law may be different from that under the laws of Hong Kong or other jurisdictions.

The Company was incorporated in the Cayman Islands and its affairs are governed by its Memorandum, Articles, the Companies Act and the common law of the Cayman Islands. The rights of our Shareholders to take action against our Directors, the rights of minority shareholders to instigate actions and the fiduciary responsibilities of our Directors to us under Cayman Islands law are to a large extent governed by the common law of the Cayman Islands. The laws of the Cayman Islands relating to the protection of the interest of minority shareholders 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. A summary of the company law of the Cayman Islands on protection of minority shareholders is set out in the section headed “—Summary of the Constitution of our Company and Cayman Islands Companies Law—3. Company Laws of the Cayman Islands—3.10. Taxation” in Appendix III to this document.

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Our Controlling Shareholders have substantial influence over the Company and their interests may not be aligned with the interests of Shareholders who [REDACTED] for Shares in the [REDACTED].

Immediately after the [REDACTED], our Controlling Shareholders will directly or indirectly control the exercise of [REDACTED]% of voting rights in the general meeting of the Company. For further details, please refer to the section headed “Relationship with Controlling Shareholders” in this document. The interests of our Controlling Shareholders may differ from the interests of our other Shareholders. 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. This concentration of ownership may discourage, delay or prevent changes in control of the Company that would otherwise benefit our other Shareholders. To the extent that the interests of our Controlling Shareholders conflict with those of our other Shareholders, our other Shareholders may be deprived of opportunities to advance or protect their interests.

Since there will be a gap of several days between the pricing and trading of our [REDACTED], the price of our [REDACTED] could fall below the [REDACTED] when trading commences.

The [REDACTED] of our Shares will be determined on the [REDACTED], which is expected to be on or around [REDACTED]. However, our Shares will not commence trading on the Stock Exchange until the [REDACTED], which is expected to be [REDACTED]. Accordingly, investors may not be able to sell or deal in our Shares during the period between the [REDACTED] and the [REDACTED]. Our Shareholders are subject to the risk that the price of our Shares could fall before trading begins, as a result of adverse market conditions or other adverse developments that could occur between the [REDACTED] and the [REDACTED].

We cannot guarantee the accuracy of facts, forecasts and statistics with respect to the PRC, the PRC economy and our relevant industries contained in this document.

Certain facts, forecasts and statistics in this document relating to the PRC, the PRC economy and industries relevant to us were obtained from information provided or published by PRC Government agencies, industry associations, independent research institutions or other third-party sources, and we can guarantee neither the quality nor reliability of such source materials. They have not been prepared or independently verified by us, the Sole Sponsor, the [REDACTED], the [REDACTED], the [REDACTED] and the [REDACTED] or any of its or their respective affiliates or advisors. Therefore, we make no representation as to the accuracy of such facts, forecasts and statistics, which may not be consistent with other information compiled within or outside of the PRC. Due to possibly flawed or ineffective collection methods or discrepancies between published information and market practice, the statistics herein may be inaccurate or incomparable to statistics produced for other economies and should not be relied upon. Furthermore, we cannot assure you that they are stated or compiled on the same basis, or with the same degree of accuracy, as similar statistics presented elsewhere. In all cases, investors should consider how much weight or importance they should attach to or place on such facts, forecasts or statistics.

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Forward-looking statements contained in this document are subject to risks and uncertainties.

This document contains certain forward-looking statements and information relating to us 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”, “estimate”, “expect”, “going forward”, “intend”, “ought to”, “may”, “might”, “plan”, “potential”, “predict”, “project”, “seek”, “should”, “will”, “would” and similar expressions, as they relate to our Company or our management, are intended to identify forward-looking statements. Such statements reflect the current views of our management with respect to future events, business operations, liquidity and capital resources, some of which may not materialise or may change. These statements are subject to certain risks, uncertainties and assumptions, including the other risk factors as described in this document. Subject to the ongoing disclosure obligations of the Listing Rules or other requirements of the Stock Exchange, we do not intend publicly to update or otherwise revise the forward-looking statements in this document, whether as a result of new information, future events or otherwise. Investors should not place undue reliance on such forward-looking statements and information.

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

Prior or subsequent to the publication of this document, there may be press and media coverage regarding us and the [REDACTED], in addition to marketing materials we published in compliance with the Listing Rules. Such press and media coverage may include references to information that do not appear in this document or is inaccurate. We have not authorised the publication of any such information contained in unauthorised press and media coverage. Therefore, we make no representation as to the appropriateness, accuracy, completeness or reliability of any information disseminated in the media and do not accept any responsibility for the accuracy or completeness of any financial information or forward-looking statements contained therein. To the extent that any of the information in the media is inconsistent or conflicts with the contents of this document, we expressly disclaim it. Accordingly, prospective investors should only rely on information included in this document and not on any of the information in press articles or other media coverage in deciding whether or not to purchase the [REDACTED].

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

MANAGEMENT PRESENCE

Pursuant to Rule 8.12 of the Listing Rules, an issuer must have sufficient management presence in Hong Kong, which normally means having at least two of the issuer’s executive directors must be ordinarily resident in Hong Kong.

Currently, neither of our two executive Directors ordinarily resides in Hong Kong. Our Company does not, and for the foreseeable future, will not, have other executive Directors who are ordinarily resident in Hong Kong for the purpose of satisfying the requirements under Rule 8.12 of the Listing Rules. Our Group’s business operations and assets are primarily based outside Hong Kong, and it would be practically difficult and not commercially necessary for us to relocate additional executive Directors to Hong Kong for the purpose of satisfying the requirements under Rule 8.12 of the Listing Rules. Accordingly, we have applied to the Stock Exchange for, and the Stock Exchange [has granted] us, a waiver from compliance with Rule 8.12 of the Listing Rules on the basis that the following measures have been adopted by us:

(1) we have appointed two authorised representatives, Mr. Wong Wai Lam (黄威林), our executive Director, and Ms. Chan Lok Yee (陳濼而), our joint company secretary, pursuant to Rule 3.05 of the Listing Rules who will act as our Company’s principal channel of communication with the Stock Exchange and ensure that they comply with the Listing Rules at all times. Ms. Chan Lok Yee is ordinarily resident in Hong Kong. Each of our authorised 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 two authorised representatives is authorised to communicate on our behalf with the Stock Exchange;

(2) both our authorised representatives have means to contact all members of our Board (including our independent non-executive Directors) promptly at all times as and when the Stock Exchange wishes to contact the members of our Board for any matters. Our 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. All Directors have provided his/her mobile phone numbers, fax numbers and e-mail addresses (where available) to our authorised representatives, in the event that a Director expects to travel or is otherwise out of office, he/she will endeavour to provide the phone number of the place of his/her accommodation to our authorised representatives or maintain an open line of communication via his/her mobile phone and all Directors and authorised representatives have provided his/her mobile numbers, office phone numbers, fax numbers and email addresses (where available) to the Stock Exchange;

(3) we have appointed CEB International Capital Corporation Limited as our compliance advisor pursuant to Rule 3A.19 of the Listing Rules, which has access at all times to our authorised representatives, Directors, senior management and other

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officers of our Company, and will act as an additional channel of communication between the Stock Exchange and us; and

(4) meetings between the Stock Exchange and our Directors could be arranged through our authorised representatives or the compliance advisor, or directly with our Directors within a reasonable time frame. Our Company will promptly inform the Stock Exchange of any changes of our authorised representatives and/or our compliance advisor.

CONNECTED TRANSACTIONS

We have entered into certain transactions which will constitute continuing connected transactions for our Company under the Listing Rules after the [REDACTED]. We have applied for, and the Stock Exchange [has granted] us, waivers from strict compliance with (i) the announcement requirement under Chapter 14A of the Listing Rules in respect of the continuing connected transactions as disclosed in the section headed “Connected Transactions—(A) Continuing Connected Transactions subject to the Reporting, Annual Review and Announcement Requirements but exempt from the Circular and Independent Shareholders’ Approval Requirements” in this document; and (ii) the announcement, circular and independent Shareholders’ approval requirements under Chapter 14A of the Listing Rules in respect of the continuing connected transactions as disclosed in the section headed “Connected Transactions—(B) Continuing Connected Transactions subject to the Reporting, Annual Review, Announcement, Circular and Independent Shareholders’ Approval Requirements” in this document. See the section headed “Connected Transactions” in this document for further information.

JOINT COMPANY SECRETARIES

According to Rules 3.28 and 8.17 of the Listing Rules and the Guidance Letter HKEX-GL 108-20 issued by the Stock Exchange, 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 (Chapter 159 of the Laws of Hong Kong) or a certified public accountant as defined in the Professional Accountants Ordinance (Chapter 50 of the Laws of Hong Kong); 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 company secretary.

We have appointed Mr. Lin Wei (林偉) and Ms. Chan Lok Yee as our joint company secretaries. Mr. Lin Wei is our Group’s head of finance department and securities affairs department and is responsible for the daily affairs of the abovementioned departments of our Group. He has over 11 years of experience in financial management. Our Directors are of the view that, having regard to Mr. Lin Wei’s thorough understanding of the financial operations and overall management of our Group, he is therefore considered as a suitable person to act as a company secretary of the Company. In addition, as our headquarters and principal business operations are located in the PRC, our Directors believe that it is necessary to appoint Mr. Lin Wei as a joint company secretary whose presence in the PRC enables him to attend to the day-to-day corporate secretarial matters concerning our Group. However, as Mr. Lin Wei does

–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. WAIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES not possess the qualification stipulated in Note 1 to Rule 3.28 of the Listing Rules, he is not able to solely fulfil the requirements under Rules 3.28 and 8.17 of the Listing Rules. Therefore, our Company has appointed Ms. Chan Lok Yee, an associate member of the Hong Kong Institute of Chartered Secretaries and an associate member of The Institute of Chartered Secretaries and Administrators (now known as The Chartered Governance Institute) in the United Kingdom, who is qualified under Rule 3.28 of the Listing Rules, to act as the other joint company secretary to provide support to Mr. Lin Wei on an ongoing basis.

Accordingly, we have applied to the Stock Exchange for, and the Stock Exchange [has granted] us, a waiver from strict compliance with the requirements under Rules 3.28 and 8.17 of the Listing Rules on the condition that Mr. Lin Wei will be assisted by Ms. Chan Lok Yee as our joint company secretary throughout the three-year period from the [REDACTED]. Ms. Chan Lok Yee will assist Mr. Lin Wei and provide training and guidance to him throughout the three-year period from the [REDACTED]. Being a manager of corporate services at Vistra Corporate Services (HK) Limited, and by virtue of her experience in corporate secretarial practice, Ms. Chan Lok Yee is, in our Directors’ opinion, a person who is qualified and suitable to provide assistance to Mr. Lin Wei for the three-year period from the [REDACTED]soasto enable him to acquire the relevant experience (as required under Note 2 to Rule 3.28 of the Listing Rules) to duly discharge his duties. In addition, Ms. Chan Lok Yee will comply with the annual professional training requirement under Rule 3.29 of the Listing Rules and will enhance her knowledge of the Listing Rules during the three-year period from the [REDACTED]. Our Company will further ensure that Mr. Lin Wei has access to the relevant training and support that would enhance his understanding of the Listing Rules and the duties of a company secretary of an issuer [REDACTED] on the Stock Exchange.

Such waiver will be revoked immediately if and when Ms. Chan Lok Yee ceases to provide such assistance or the Company commits any material breaches of the Listing Rules during the three-year period from the Listing Date. We will liaise with the Stock Exchange before the end of the three-year period to enable it to assess whether Mr. Lin Wei, having had the benefit of Ms. Chan Lok Yee’s assistance for three years, will have acquired the relevant experience within the meaning of Rule 3.28 of the Listing Rules so that a further waiver will not be necessary.

In addition, we have appointed CEB International Capital Corporation Limited as our compliance adviser under Rule 3A.19 of the Listing Rules for a period commencing on the [REDACTED] and ending on the date on which our Company complies with Rule 13.46 of the Listing Rules in respect of its financial results for the first full financial year commencing from the [REDACTED] to provide our Company with professional advice on continuing obligations under the Listing Rules and to act as an additional channel of communication with the Stock Exchange. Mr. Lin Wei will have access to such compliance adviser during the term of appointment, which will provide Mr. Lin Wei with an additional source of guidance to assist him to familiarise himself with the functions of a company secretary of a company [REDACTED] on the Stock Exchange.

The biographical information of Mr. Lin Wei and Ms. Chan Lok Yee is set out in the section headed “Directors and Senior Management” in this document.

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[REDACTED]

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[REDACTED]

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[REDACTED]

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[REDACTED]

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DIRECTORS

Name Address Nationality

Executive Directors

Ms. Wong Tan Ching (黃丹青) Unit 01, 1st Floor Chinese (Hong Kong) Building 4, Jiangshan Haomeijia 289 Yangqiao West Road Gulou District Fuzhou Fujian Province PRC

Mr. Wong Wai Lam (黃威林) Unit 01, 1st Floor Chinese (Hong Kong) Building 4, Jiangshan Haomeijia 289 Yangqiao West Road Gulou District Fuzhou Fujian Province PRC

Non-executive Director

Mr. Chen Zhong (陳忠) 406 Chinese No. 7 Xinyang Lane Gulou District Fuzhou Fujian Province PRC

Mr. Feng Shijun (馮世軍) No. 11, Unit 2, Building 6 Chinese No. 9 Zijing East Road Gaoxing District Chengdu Sichuan Province PRC

Mr. Tang Shijie (唐世界) 9-608 Zuitang Garden Chinese No. 12 Jinhuan Road, Cangshan District Fuzhou Fujian Province PRC

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Name Address Nationality

Mr. Pei Luyang (裴路陽) Unit 1707, Tower 5 Chinese (Hong Kong) No. 25 Huaping Road Gulou District Fuzhou Fujian Province PRC

Independent Non-executive Directors

Ms. Leung Bo Yee, Nancy Nebula Scape Chinese (Hong Kong) (梁寶儀) 26D Cape Road Chung Hom Kok Hong Kong

Ms. Ng Chung Yan Linda Flat G, 23/F, Tower 1 Chinese (Hong Kong) (伍頌恩) Tivoli Garden 75 Tsing King Road Tsing Yi New Territories Hong Kong

Ms. Chen Qingfang (陳慶芳) 26-1, Unit 4 Chinese No. 318 Minsheng Road Yuzhong District Chongqing PRC

For further information regarding our Directors, please refer to the section headed “Directors and Senior Management” in this document.

PARTIES INVOLVED IN THE [REDACTED]

Sole Sponsor CEB International Capital Corporation Limited 22/F, AIA Central 1 Connaught Road Central Hong Kong

[REDACTED]

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Legal Advisors to the Company As to Hong Kong law: Sidley Austin 39th Floor Two International Finance Centre 8 Finance Street Central Hong Kong

As to PRC law: Commerce & Finance Law Offices 6/F, NCI Tower A12 Jianguomenwai Avenue Chaoyang District Beijing PRC

As to Cayman Islands law: Harney Westwood & Riegels 3501 The Center 99 Queen’s Road Central Hong Kong

Legal Advisors to the Sole Sponsor, As to Hong Kong law: [REDACTED] Ashurst Hong Kong 11/F, Jardine House One Connaught Place Central Hong Kong

As to PRC law: Allbright Law Offices 11, 12/F Shanghai Tower No.501 Yincheng Middle Road Pudong New Area Shanghai PRC

Independent Industry Consultant China Index Academy Tower A No. 20 Guogongzhuang Middle Street Fengtai District Beijing PRC

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Auditors and Reporting Accountants Grant Thornton Hong Kong Limited Certified Public Accountants 12/F 28 Hennessy Road Wanchai Hong Kong

Tax Advisors Zhitong (Fujian) Registered Tax Agents Co., Ltd. Office 06, Floor 22, Office Building Yangguang Jiari Plaza No. 357 Xiangban Street Ninghua Neighborhood Taijiang District Fuzhou Fujian Province PRC

[REDACTED]

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Registered Office Harneys Fiduciary (Cayman) Limited 4th Floor, Harbour Place 103 South Church Street P.O. Box 10240, Grand Cayman KY1-1002 Cayman Islands

Headquarters and Principal Place of No. 110, 66 Ronghui Avenue Business in the PRC Ba’nan District Chongqing PRC

Principal Place of Business in Room 1901, 19/F Lee Garden One Hong Kong 33 Hysan Avenue Causeway Bay Hong Kong

Company’s Website www.rhjoylife.com (Information contained in this website does not form part of this document)

Joint Company Secretaries Mr. Lin Wei (林偉) Unit 502, Block 13 Sunshine City 28 Fuxin Road Gulou District Fuzhou Fujian Province PRC

Ms. Chan Lok Yee (陳濼而) (ACG, ACS) Room 1901, 19/F Lee Garden One 33 Hysan Avenue Causeway Bay Hong Kong

Authorised Representatives Mr. Wong Wai Lam (黃威林) Unit 01, 1st Floor Building 4, Jiangshan Haomeijia 289 Yangqiao West Road Gulou District Fuzhou Fujian Province PRC

Ms. Chan Lok Yee (陳濼而) (ACG, ACS) Room 1901, 19/F Lee Garden One 33 Hysan Avenue Causeway Bay Hong Kong

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Audit Committee Ms. Ng Chung Yan Linda (Chairperson) Mr. Tang Shijie Ms. Leung Bo Yee, Nancy

Remuneration Committee Ms. Ng Chung Yan Linda (Chairperson) Ms. Wong Tan Ching Ms. Leung Bo Yee, Nancy

Nomination Committee Ms. Wong Tan Ching (Chairperson) Ms. Ng Chung Yan Linda Ms. Leung Bo Yee, Nancy

Compliance Advisor CEB International Capital Corporation Limited 22/F, AIA Central No.1 Connaught Road Central Hong Kong

Principal Share Registrar and [REDACTED] Transfer Office in the Cayman Islands

Hong Kong Share Registrar [REDACTED]

Principal Banks Bank of China, Chongqing Lijiatuo Branch 160-5 Lijiatuozheng Street Ba’nan District Chongqing PRC

Bank of China, Jinan Sunshine New Road Branch 54 Yangguang New Road Shizhong District Jinan Shandong Province PRC

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Industrial and Commercial Bank of China, Fuzhou Jinjiang Branch No. A02 Front Street Rongqiao Jinjiang District B Shopping Center No. 66 West Jiangbin Avenue Gulou District Fuzhou Fujian Province 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 Sole Sponsor, the [REDACTED], the [REDACTED], the [REDACTED], any of their directors, officers, affiliates, advisors or representatives, or any other party (other than CIA) involved in the [REDACTED]. We, the Sole Sponsor, the [REDACTED], 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.

BACKGROUND AND METHODOLOGIES OF CIA We commissioned CIA, an independent market research and consulting company, to conduct an analysis of, and to prepare a report on the property management industry and commercial operational service industry in the PRC. We agree to pay CIA a total fee of RMB800,000, which we believe reflects the market rates for reports of this type. CIA has extensive experiences in researching and tracking the PRC property management industry and commercial operational service industry, and has conducted research on the Top 100 Property Management Companies together with the China Real Estate Top 10 Research Group since 2008. CIA uses research parameters and assumptions and gathers data from multiple primary and secondary sources, including (i) data provided by property management companies for the purpose of marketing research; (ii) property owner satisfaction surveys conducted by the China Real Estate Top 10 Research Group; (iii) data from the China Real Estate Index System and the China Real Estate Statistics Yearbooks; (iv) public information of property management companies (including corporate website and promotion materials); (v) public data from governmental authorities; and (iv) data gathered previously from the property management companies. The ranking of China’s Top 100 Property Management Companies is based on an index system that primarily evaluates data in relation to management scale, operational performance, service quality, growth potential and social responsibility of the property management companies under consideration. CIA 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 as well as the total number and composition of employees. Data analysis in this section includes data and information on the Top 100 Property Management Companies as ranked by CIA. In determining such rankings, CIA adopts the factor analysis method and 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. 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 and commercial operational service industry in China will remain unchanged during the forecast period; (iii) all data published by the relevant statistics bureaus are accurate; (iv) the COVID-19 outbreak will have short term impact on the Chinese economy stability; and (v) all information collected relating to residential sales transactions from the relevant local housing administrative bureaus are accurate. THE PRC PROPERTY MANAGEMENT INDUSTRY Overview The property management industry in the PRC is intensely competitive and highly fragmented. Over the years, the steady growth of economy, accelerating urbanisation, consumption upgrades and increasing residents’ income level in the PRC provided strong demand for the property management market. Meanwhile, the policies related to the property management industry have gradually evolved from normative to supportive. In addition, the application of internet has provided new opportunities in exploring more technology-enabled roles and functions for the property management service providers. PRC property management companies currently provide services in relation to a wide range of properties in addition to residential properties, such as commercial properties, industrial parks, schools and hospitals.

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Major Fee Models in the Property Management Industry In addition to the revenue generated from general property management services, property management companies in the PRC may also generate revenue from community value-added services, including, among others, community area operational services, e-commerce services, property agency services, housekeeping services, community finance services and elderly care services and non-property owners’ value-added services, including, among others, sales area management services, engineering services and consultancy 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 the PRC, especially for residential properties. The lump-sum fee model can increase efficiency by dispensing certain collective decision-making procedures for large expenditures by property owners and residents and incentivizing property management service providers to optimise 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 the management of their properties and closely supervise service providers. Overview of the Top 100 Property Management Companies According to CIA, the Top 100 Property Management Companies have been able to lower operating cost ratio by diversifying their services, adopting upgraded technologies and standardisation procedures to become more automated. The total GFA under management by the Top 100 Property Management Companies increased from 5.4 billion sq.m. in 2016 to 12.9 billion sq.m. in 2020, representing a CAGR of 24.0%, expected to increase to 22.2 billion sq.m. in 2025, representing a CAGR of 11.7%. In 2020, average property management fee for residential properties managed by the Top 100 Property Management Companies (as the dominant portion of their property management portfolios) was RMB2.05 per sq.m. per month. The average operating cost ratio of the Top 100 Property Management Companies was approximately 76.0% and 75.5% in 2019 and 2020, respectively. Market Size of Property Management Industry Market Size and Future Development of Property Management Industry in the PRC According to CIA, from 2016 to 2020, the urbanisation rate of the PRC rose from 57.4% to 63.9%, representing a CAGR of 2.7%. The increase in urbanisation rate led to the expansion of the urban housing market and the scale of property management services. According to CIA, the total GFA under management in the PRC increased from 18.5 billion sq.m. in 2016 to 25.9 billion sq.m. in 2020, representing a CAGR of 8.8%, and is expected to increase to 34.8 billion sq.m. in 2025, representing a CAGR of 6.2%. The chart below sets out the total GFA under management in the PRC and total GFA under management by the Top 100 Property Management Companies, for the years indicated: 40.0 Unit: billion sq.m. 70% GFA under management in the PRC 34.8 33.3 35.0 2016-2020 CAGR: 8.8% 60% 2021-2025e CAGR: 6.2% 31.1 61.3% 63.9% 29.0 30.0 59.1% 27.4 56.5% 25.9 50% 52.1% 23.9 49.7% 25.0 22.2 21.1 43.6% 20.4 40% 19.5 20.0 18.5 38.9% 18.4 16.4 30% 32.4% 14.2 15.0 29.4% 12.9 10.4 20% 10.0 8.2 6.3 5.4 5.0 10%

0.0 0% 2016 2017 2018 2019 2020 2021e 2022e 2023e 2024e 2025e

GFA under GFA under management Market share of the management by the Top 100 Property Top 100 Property in the PRC Management Companies Management Companies

Source: CIA Report

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Overview of Property Management Industry in the Southwest Region of the PRC, Chongqing, Shandong Province and Fujian Province Benefited from the continuous advancement of a series of supporting policies such as the Large-scale Development of Western Regions Strategy (西部大開發戰略) and the Framework Plan for New Land and Marine Routes for Western Regions (西部陸海新通道總體規劃), the Southwest Region has gradually become a hot spot for investment. According to CIA, the urbanisation rate of the Southwest Region reached 53.4% in 2019 and per capita disposable income for the urban population in the Southwest Region reached RMB38,602 per annum in 2020. As one of the core cities in the Southwest Region, the strategic position of Chongqing has continuously improved. According to CIA, the urbanisation rate of Chongqing reached 66.8% in 2019 and per capita disposable income for the urban population in Chongqing reached RMB40,006 per annum in 2020. Fujian Province has actively promoted its economic development in recent years and Fuzhou has become one of the core cities of the Western Taiwan Straits Economic Zone (海峽西岸經濟區). According to CIA, the urbanisation rate of the Fujian Province reached 66.5% in 2019 and per capita disposable income for the urban population in the Fujian Province reached RMB47,160 per annum in 2020. Shandong Province has actively promoted its economic development in recent years and Jinan has become the core city of the Jinan Metropolitan Circle (濟南都市圈) and one of the central cities of the south wing of the Bohai Rim Region (環渤海地區). According to CIA, the urbanisation rate of the Shandong Province reached 61.5% in 2019 and per capita disposable income for the urban population in the Shandong Province reached RMB43,726 per annum in 2020. The table below sets out the total GFA under management in Southwest Region of the PRC, Chongqing, Shandong Province and Fujian Province for the years indicated:

Unit: billion sq.m. 2016 2017 2018 2019 2020 CAGR 2016-2020

Total GFA under management in the Southwest Region of the PRC 2.5 2.7 3.0 3.2 3.4 8.0%

Total GFA under management in Chongqing 0.7 0.8 0.8 0.9 1.0 8.3%

Total GFA under management in Fujian 0.7 0.8 0.8 0.9 0.9 6.2%

Total GFA under management in Shandong 1.4 1.4 1.5 1.6 1.7 5.0%

Source: CIA Report Types of Properties under Management According to CIA, in 2020, the total GFA under management by the Top 100 Property Management Companies increased for five consecutive years and reached 12.9 billion sq.m. In the total GFA under management by the Top 100 Property Management Companies, the percentage of non-residential properties increased over the recent years due to its larger market potential, higher average management fee, higher management fee collection rate and lower difficulty in raising price. The table below sets forth the percentage of total GFA under management by the Top 100 Property Management Companies in 2020 for each type of properties by geographical locations as indicated.

residential commercial office industrial public schools hospitals others properties properties properties parks properties

PRC 66.3% 6.7% 7.6% 6.5% 2.3% 2.8% 2.0% 6.0%

Southwest Region 72.3% 6.1% 5.8% 7.2% 1.6% 3.6% 0.6% 2.8%

Chongqing 75.1% 3.9% 3.7% 8.7% 0.4% 1.1% 0.4% 6.7%

Fujian 66.5% 2.9% 11.2% 3.5% 1.0% 5.9% 1.2% 7.9%

Shandong 62.8% 5.9% 5.8% 2.4% 2.4% 8.5% 0.7% 11.6%

Source: CIA Report Historical Price Trends Property Management Fees The average property management fee for the Top 100 Property Management Companies for residential properties decreased from RMB2.31 per sq.m. per month in 2016 to RMB2.05 per sq.m. per month in 2020, representing a CAGR of -2.9%. The average property management fee for the Top 100 Property Management Companies for non-residential properties decreased from

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RMB6.29 per sq.m. per month in 2016 to RMB4.99 per sq.m. per month in 2020, representing a CAGR of -5.6%. According to CIA, in 2020, the management fee for non-residential properties is generally higher than that for the residential properties. The table below sets forth the average management fee for the Top 100 Property Management Companies for each type of properties in each tier of cities as indicated in 2020.

RMB/m2/month national first tier cities second tier cities third and fourth tier cities

Residential properties 2.1 3.0 2.0 1.8

Commercial properties 6.2 11.2 5.5 5.2

Office properties 6.9 12.0 6.3 5.9

Public properties 3.4 4.9 3.2 3.1

Industrial parks 3.3 3.7 3.4 3.0

Schools 3.3 4.4 3.3 2.3

Hospitals 6.2 9.8 5.9 3.0

Others 4.0 4.8 4.5 3.0

Average 3.8 6.6 3.4 3.3

Residential properties Commercial properties Office properties Public properties Industrial parks Schools Hospitals Others

Source: CIA Report As at 31 December 2020, the average management fee for the Top 100 Property Management Companies in Chongqing, Fuzhou and Jinan was RMB3.00 per sq.m. per month, RMB2.77 per sq.m. per month and RMB3.33 per sq.m. per month, respectively. For the years ended 31 December 2018, 2019 and 2020, the average management fee collection rate for the Top 100 Property Management Companies was 93.8%, 93.1% and 93.6%, respectively. Labour costs The average labour costs of Top 100 Property Management Companies amounted to RMB391.6 million, RMB466.8 million and RMB516.7 million in 2018, 2019 and 2020, respectively. Labour costs are the largest component of costs among the Top 100 Property Management Companies, which accounted for 57.8%, 59.1% and 58.3% of the total costs of sales of the Top 100 Property Management Companies in 2018, 2019 and 2020, respectively. The Top 100 Property Management Companies are faced with increasing labour costs pressure as a result of the rise of minimum wage level in major cities of the PRC and the increasing number of staff employed, which in turn increases other costs, including training and management costs. Industry Growth Drivers for Property Management Industry Rapid Urbanisation and Growth in Per Capita Disposable Income and Growth in Demand According to CIA, China’s growth in urbanisation 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. Given the growth in per capital disposal income, we expect consumers for property management services to become increasingly sophisticated in their service requirements and preferences and, in turn, could be willing to pay higher premiums for quality services. Favourable Policies 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 Opinion on Strengthening and Improving the Governance of Urban and Rural Communities《關於加強和完善城鄉社區治理的意見》 ( ) and the Circular on Strengthening and Improving the Administration of Residential Property《關於加強和改進住宅物業管理工作的通知》. Moreover, the Civil Code《民法典》 ( ) implemented on 1 January 2021 provides clearer and more detailed regulations on the rights and obligations of property management companies, such as engagement of property management services companies and collection and use of the maintenance and repair fund. 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 with government encouragement under the various regulatory frameworks.

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Growth in Supply of Properties Following rapid urbanisation and continuous growth in per capita disposable income, the supply of residential properties in the PRC also grew substantially. The total GFA of properties sold increased from 1,573.5 million sq.m. in 2016 to 1,760.9 million sq.m. in 2020, representing a CAGR of approximately 2.9%. Increasing Adoption of Information Technology in Property Management Service Many property management companies have to some extent reduced costs and enhanced profitability by applying information technologies such as cloud application, e-commerce, internet of things, big data and artificial intelligence to their business operations. 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 include common area management, property agency and housekeeping, among others. As a result, the revenue generated from value-added services increasingly becomes an important source of revenue for property management companies. Access to the Hong Kong capital market Since 2014, Hong Kong capital market has been providing an alternative avenue for property management companies to raise funds. Increased access to the capital market in Hong Kong provides property management companies with funds for future development and can carry out high-quality mergers and acquisitions to achieve scale expansion and service development rapidly. THE PRC COMMERCIAL OPERATIONAL SERVICE INDUSTRY OVERVIEW Overview Commercial operational service provides a series of consultation and operation services that cover the entire life cycle of the commercial properties, including but not limited to market research and positioning services, tenant sourcing services, pre-opening preparatory and commercial operation services. The core value of commercial operation service lies in the continuous operation and management of commercial projects to enhance the value of commercial projects by attracting more customers and achieving higher occupancy rates and rents. In terms of fee model, the fees charged for commercial operational services are generally agreed upon parties, depending on the nature of the services provided at different stages, such as fixed management fee based on total GFA under management and management fee charged based on the revenue of the tenants. However, according to CIA, there is still no standardised fee or market practice followed in the industry. Market Size of Commercial Operational Service Industry With the acceleration of urbanisation and the increasing investment in commercial properties, the commercial operational service market expanded in recent years. According to CIA, the total GFA of commercial properties under management in the PRC have increased from 704.6 million sq.m in 2016 to 1.2 billion sq.m. in 2020, representing a CAGR of 13.5%, and is expected to increase to 1.9 billion sq.m. in 2025, representing a CAGR of 10.0%. The chart below sets forth the total GFA of commercial properties under management in the PRC for the years indicated:

2,000 2016-2020 CAGR 13.5% 1,892.0 1,720.0 1,800 2021e-2025e CAGR 10.0% 1,563.7 1,600 1,421.5 1,400 1,292.3 1,170.0 1,200 1,068.0 on sq.m. i 928.1

ll 1,000 i 806.8

t: m 800 704.6 i

Un 600

400

200

0 2016 2017 2018 2019 2020 2021e 2022e 2023e 2024e 2025e

Source: CIA Report

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The table below sets forth the total GFA of commercial properties under management by geographical regions as indicated from 2016 to 2020.

Unit: million sq.m. PRC Southwest Region Chongqing Fujian Shandong

2016 704.6 62.0 33.2 24.1 45.7

2017 806.8 70.4 38.2 27.2 48.8

2018 928.1 82.2 44.4 31.1 54.3

2019 1,068.0 98.0 50.2 33.6 62.5

2020 1,170.0 107.4 55.0 36.8 68.5

CAGR 2016-2020 13.5% 14.7% 13.4% 11.2% 10.6%

Source: CIA Report Industry Growth Drivers for the Commercial Operational Industry Favourable policies for expanding domestic demand, promoting consumption and stabilising growth On 13 March 2020, the National Development and Reform Commission and other 23 ministries and commissions jointly issued the “Implementation Opinions on Promoting Expansion and Quality of Consumption and Accelerating the Formation of a Strong Domestic Market”, proposing to adapt to the trend of residents’ consumption upgrade, accelerate the improvement of consumption promotion mechanisms and further improve the consumption environment. In January 2020, the Chongqing Municipal People’s Government issued the “Notice of the General Office of the Chongqing Municipal People’s Government on Accelerating the Development of Circulation and Promoting Commercial Consumption”, with a purpose of promoting consumption in 20 areas by accelerating the transformation and upgrading of traditional enterprises, the transformation and upgrading of commercial pedestrian streets, the development of branded chain convenience stores, the optimisation of community convenience commercial facilities and the satisfaction of consumer demand for high-quality goods. Rapid Urbanisation and Scaled Commercial Property Market The urbanisation rate in China increased from approximately 57.4% in 2016 to approximately 63.9% in 2020. Urbanisation leads to the development of urban area which increases the consumption power and demand, together with the upgrade of commercial environment, will promote the growth of commercial properties market and in turn stimulate the demand for commercial operational services market. In addition, the Chinese government is accelerating the urbanisation process and cultivating new growth poles in the central and western regions of China, which provides growth opportunities for the commercial property and commercial operational services markets in those regions. Continuous Growth in Consumption and Upgrades in Consumer’s Spending Power The total retail sales of consumer goods of China increased from RMB33.2 trillion in 2016 to RMB39.2 trillion in 2020, representing a CAGR of 4.2%. The consumption continued to serve as the main engine driving growth. The PRC Government will promote income growth and ensure that people’s basic needs are met so as to encourage and enable consumer spending. According to CIA, consumption will continue to provide important support for the Chinese economy towards high-quality development. In addition, the increase in per capita annual disposable income in China has a positive effect on Chinese consumers’ demand for better commercial operational services. Information Technology Promotes the Rapid Growth of Commercial Operational Services According to CIA, traditional commercial operational services are facing many problems such as “difficult management, slow tenant sourcing and complicated account management” (管理難,招商慢,賬務雜). To better control costs and maintain competitiveness, commercial operational service providers need to standardise and automate their operations to improve their competence and service quality and to meet diversified customer demands. For example, the commercial operational service providers can apply digitalised and intelligent information service platform to integrate the corporate ERP system, commercial operation system and accounting system and reorganise their online and offline data, so as to achieve operational efficiency. In addition, the new technology offers customers a more convenient shopping experience with the latest shopping information, and on the other hand allows the merchants to have access to the data of the products, the shops and the customers so as to assist their commercial decision making.

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LARGE-SCALE INTEGRATED PROPERTY MANAGEMENT SERVICES According to CIA, large-scale integrated property refers to a real estate project that contains residential properties and at least one type of non-residential properties with a GFA of more than 500,000 sq.m. that has the integrated functions such as residential and commercial consumption. Therefore, the large-scale integrated property is a concept in terms of both scale and property types. As a special business combination, the large-scale integrated property has the characteristics of large scale, high density and synergy effect of diversified property types. Therefore, when managing large-scale integrated property, property management companies are providing services to multiple property types simultaneously, which is different from managing single-use properties, such as residential-only or office-only properties. In addition, benefiting from the large-scale, high-density, and synergy effect of diversified property types of the large-scale integrated property, the property management companies of the large-scale integrated property have advantages in providing various value-added services. For the property management industry which is increasingly emphasising on “cost reduction and efficiency improvement”, management of large scale integrated property has unique advantages, including the following: (1) Scale effect promotes cost reduction Large-scale integrated property normally has a GFA of more than 500,000 sq.m. The scale effect can effectively reduce the material cost and labour cost per sq.m. under management of providing property management services. (2) High density is conducive to the provision of value-added services Large-scale integrated property normally has a high density in terms of population, which facilitates the provision of various value-added services. Many value-added services, such as housekeeping, childcare, elderly care, and other home services, rely heavily on population density, which can create a larger market for these value-added services and dilute the costs. (3) Synergy of diversified property types The large-scale integrated property has the characteristics of diversified property types. It normally contains residential properties and at least one type of non-residential properties, which enables the residents of the large-scale integrated property to enjoy various supporting services nearby. For example, commercial properties can provide residents with various shopping and entertainment services, and office properties can meet the residents’ needs for office space and properties with cultural and tourism characteristics can satisfy the residents’ recreational demands both physically and mentally, so as to increase their satisfaction and loyalty. Leveraging the interaction and coordination of residential and non-residential properties, property management companies can provide more diversified services to the residents with a smaller investment. Therefore, the diversified property types of the large-scale integrated property can create synergy across different types of properties and benefit the project as a whole. According to CIA, as at the end of 2020, the total GFA under management of the large-scale integrated property was 4.4 billion, sq.m. Among the China’s Top 100 Property Management Companies in 2020, the total GFA under management of the large-scale integrated property was 2.2 billion sq.m., accounted for 17.5% of the total GFA under management of the China’s Top 100 Property Management Companies. The total GFA of the large-scale integrated property under managed by the Top 100 Property Management Companies was 192 million sq.m in Southwest Region and 61 million sq.m in Chongqing. We are specialised in offering large-scale integrated property operational services. The GFA under management of our large-scale integrated property projects was 5.1 million sq.m., accounting for a majority of our total GFA under management. We were awarded the “2020 China Leading Property Management Companies in terms of Characteristic Service – Large-scale Integrated Property Operational Services” and “2021 China Leading Property Management Companies in terms of Characteristic Service – Large-scale Integrated Property Operational Services” by CIA.

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THE IMPACT OF COVID-19 PANDEMIC The COVID-19 pandemic outbroke in late 2019 and continuously spread globally. According to CIA, The likelihood that the operations of property management companies in the PRC being suspended or terminated, the supply of materials being suspended or the management fee being reduced is very remote. The COVID-19 pandemic may bring certain short-term effects on the property management industry. Generally, the delivery of certain properties were delayed by the COVID-19 pandemic and the commencement of services of the property management companies was also delayed. In terms of residential properties, the anti-virus supplies and more frequent disinfections in the common areas increased the costs for property management companies. In addition, certain value-added services and the project sourcing activities were also affected by the social distancing measures. In terms of commercial operational services, the operation of certain commercial properties were suspended during the pandemic and many commercial property management companies reduced or waived the rents for the tenants. However, the COVID-19 pandemic is expected to bring limited impact on property management industry given that (i) the nature of anti-cyclical, anti-risk and policy supportive nature of the PRC property management industry limits the impact of the COVID-19 pandemic; (ii) property management companies’ roles in implementing the quarantine measures increased its customer recognition and loyalty, which also partially improved the management fee collection rate; and (iii) the COVID-19 pandemic in the PRC mainly outbroke in the first two months of 2020 and the property market had gradually resumed since late February 2020. Although the COVID-19 pandemic caused certain short-term impact on the operations of properties management companies, in the long run, the COVID-19 pandemic also brings new opportunities for the development of the property management industry. On one hand, the quarantine measures promoted the development of smart community with intelligent management systems and stimulated the development of value-added services. On the other hand, property management companies played a significant role in combating the COVID-19 pandemic, which not only increased the customer recognition, loyalty and brand value. Government will enact supportive policies to relieve the impact of the pandemic, which will benefit property management companies. Property management companies also demonstrated their value in the management of non-residential properties such as public properties, schools and hospitals and further developed the market potential in non-residential properties management. TRENDS AND CHALLENGES Given the constant changes in the competitive landscape of the PRC property management and commercial operational industries, below are some of the main opportunities and challenges faced by the property management service providers: Increasing Market Concentration The degree of concentration of the property management industry has been increasing in recent years as large property management companies can steadily increase their GFA under management, better control their costs and realise revenues through offering value-added services. Large-scale property management companies actively accelerate their expansion by means of mergers and acquisitions of small and medium-sized property management companies in order to expand the scale of properties under management and realise economies of scale to improve their market position. Enhanced Standardisation and Automation An increasing number of leading companies are making efforts to enhance the standardisation of property management services, such as intelligent system in communities, including access control system car parking management system as well as smart shopping platforms and big data analysis platform. In addition, much more investment in intelligent technology was made to improve the efficiency of property management services. Technological solutions reduce human error and allow property management companies to consistently apply their standardised procedures and quality standards. In turn, this reduces their reliance on manual labour. Furthermore, centralised information technology enables property management companies to better apply policies, procedures and quality standards. Labour and Operational Cost The property management industry in the PRC is labour intensive. According to CIA, the average percentage of staff costs of the Top 100 Property Management Companies increased from 57.8% in 2018 to 58.3% in 2020. The minimum wage in various regions has increased in recent years. Property management companies need to recruit more staff to expand their property management scale and thus are expected to pay increasing staff salaries and benefits, as well as relevant training and management expenses.

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According to CIA, the ever-rising labour costs in recent years is a major challenge to the players in the labour-intensive property management industry to maintain sustainable development. The players may experience a decrease in profit margin, or even experience losses, in light of increases in costs and expenses. Increasing Demand for Professional Staff With the rapid technology developments, property management companies need to recruit more qualified professional talents with management and technological skills. Property management companies also increasingly demand trained professional and skilled employees to facilitate the implementation of smart management and information technologies to maintain their leading market positions. COMPETITION Competition of the Property Management Industry Overview According to CIA, the property management market in the PRC is fragmented and competitive and is gradually under consolidation. The differentiation of property management companies at different levels is intensifying. As at 31 December 2020, there were approximately 200,000 property management companies in the PRC. Large-scale property management companies gained more advantages in recent years as they experienced fast growth in GFA under management. Major property management companies in the PRC have also experienced continuous improvement in profitability due to their steadily increased GFA under management, better cost control and realisation of revenues through offering value-added services. Entry barriers Brand — As the consumers’ demand for higher quality of project management services is increasing and the industry competition is intensifying, solid operating history, good market reputation and brand image and high service quality are required for property management companies. Therefore, the brand has become an important barrier for the property management industry. Capital requirement — With the expansion of scale of management, property management companies are paying more attention to investing in automation and artificial intelligence, so as to improve management efficiency by purchasing equipment to replace labour, build enterprise information management systems and gradually promoting smart community. The transition of property management industry from labour-intensive to technology and capital-intensive requires a higher level of financial resources. Management — With the continuous intensifying competition of the property management industry, the management team and its management experience and capability have gradually become an important factor in the core competitiveness of property management companies. Excellent property management companies have their own characteristics in terms of property management services categories, information system application, and financial management, which provide them with significant advantage in sourcing larger scale projects. Specialised talents and technology — The ability in recruiting and retaining a variety of middle and senior management talents and professional technical personnel and establishing a stable long-term talent training mechanism are crucial for the successful operation of property management companies. In addition, with the application of big data and Internet technology, property management companies are exploring innovative business models and value-added services, which further emphasises the role of specialised talents. Risks in relation to Property Management Industry In the course of providing property management services, property management companies may be exposed to certain risks, which include but not limited to (i) the intensified market competition; (ii) the failure in cost management; (iii) the concentration of source of properties under management; (iv) the increase of labour costs; (v) the shortage of specialised talents; (vi) the increase of internal management costs due to merger and acquisition; and (vii) public health incidents such as the COVID-19 pandemic. Please refer to the section headed “Risk Factors – Risks Relating to our Business and Industry” in this document for further details.

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Competition of the Commercial Operational Industry Overview The commercial operational market is relatively fragmented. Entry Barriers Service experience — Due to increasing concentration of China’s commercial operational service market, mature operation, professional management experience and successful project experience are particularly important for commercial operational service providers to shape their brand image. Furthermore, in terms of large-scale and integrated shopping centres with various tenant mix, rich and mature management experience has a guiding role for the commercial operational service team in the actual operation and management process, which is one of the entry barriers to new entrants. Brand and Customer Bases — Existing participants in China’s commercial operational service market require a sufficient customer base to establish brand reputation. Due to increasing competition and concentration of China’s commercial operational service market, tenants and consumers have a preference to renowned and experienced commercial operational service providers with reputable brand names. Therefore, new entrants will face great challenges to attract consumers and establish their own customer bases. Professional Talents – Owing to expanding service scope and complexity, professional and experienced talents are required in specific segments of the commercial operational services, which often involve technical knowledge and expertise regarding the operations of certain non-residential properties or value-added services. Moreover, under the developing trend of providing diversified and differentiated services, there will be higher requirements for the technology and innovation level in the commercial operational service market. Therefore, it could be difficult for new entrants to recruit adequate number of talents with the necessary skills and experiences. Risks in relation to Commercial Operational Industry In the course of providing commercial operational services, property management companies may be exposed to certain risks, which include but not limited to (i) the intensified market competition; (ii) the inappropriate positioning of the commercial properties; and (iii) the shortage of specialised talents. Please refer to the section headed “Risk Factors – Risks Relating to our Business and Industry” in this document for further details. Competitive Landscape CIA has published the ranking of China’s Top 100 Property Management Companies in terms of overall strength, primarily by evaluating data from previous years in relation to management scale, operating performance, service quality, social responsibility and development potential. According to CIA, we ranked: (i) the 50th among the 2021 Top 100 Property Management Companies in terms of overall strength; (ii) the 55th among the 2020 Top 100 Property Management Companies in terms of overall strength; (iii) the 36th among the 2020 Top 100 Property Management Companies in terms of total GFA under management of large-scale integrated property; (iv) the 10th among the 2020 Top 100 Property Management Companies in terms of total GFA under management of large-scale integrated property located in Southwest Region; and (v) the 4th among the 2020 Top 100 Property Management Companies in terms of total GFA under management of large-scale integrated property located in Chongqing. DIRECTORS’ CONFIRMATION Our Directors confirm that, after making reasonable inquiries, there is no material adverse change in the market information since the date of the CIA Report which may qualify, contradict, misrepresent or otherwise adversely affect the accuracy and completeness of the information in this section in material aspects.

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This section sets out a summary of the most significant PRC laws and regulations that affect our business and the industry in which we operate.

REGULATIONS ON CORPORATION AND FOREIGN INVESTMENT

The establishment, operation and management of corporate entities in the PRC are governed by the PRC Company Law (中華人民共和國公司法), which was promulgated by the Standing Committee of the National People’s Congress of the PRC (全國人民代表大會常務委員會) (the “SCNPC”) on 29 December 1993 and came into effect on 1 July 1994. The Company Law was subsequently amended on 25 December 1999, 28 August 2004, 27 October 2005, 28 December 2013 and 26 October 2018. The Company Law generally governs two types of companies, namely limited liability companies and joint stock limited companies, both of which have the status of legal persons, and the liability of shareholders of a limited liability company or a joint stock limited company is limited to the amount of registered capital they have contributed. The Company Law shall also apply to foreign-invested companies in the form of limited liability company or joint stock limited company, unless otherwise provided by relevant foreign investment laws.

Before 1 January 2020, the establishment procedures, approval procedures, registered capital requirements, foreign exchange matters, accounting practices, taxation and labour matters of foreign-invested companies are regulated by, in the case of a wholly foreign-owned enterprise, the Wholly Foreign-owned Enterprise Law of the PRC (中華人民共和國外資企業法), which was promulgated on 12 April 1986 by the National People’s Congress of the PRC (全國人民代表大會) (the “NPC”) and amended by the SCNPC on 31 October 2000 and 3 September 2016, and the Regulations for the Implementation of the Wholly Foreign-owned Enterprises Law of the PRC (中華人民共和國外資企業法實施細則), which was promulgated on 12 December 1990, by the Ministry of Foreign Trade and Economy Cooperation (repealed) and amended by the State Council of the PRC (中華人民共和國國務院) (the “State Council”) on 12 April 2001 and 19 February 2014 (the latest revision became effective on 1 March 2014). On 15 March 2019, the NPC approved the Foreign Investment Law of the PRC (中華人民共和國外商投資法) (the “Foreign Investment Law”) and on 26 December 2019, the State Council promulgated the Regulation on the Implementation of the Foreign Investment Law of the PRC (中華人民共和國外商投資法實施條例), both of which came into effect on 1 January 2020 and simultaneously replaced the Wholly Foreign-owned Enterprise Law and the Regulations for the Implementation of the Wholly Foreign-owned Enterprises Law. The Foreign Investment Law sets out the definition of foreign investment and the framework for investment promotion, investment protection and administration of foreign investment activities. On 30 December 2019, the Ministry of Commerce of the PRC (中華人民共和國商務部) (the “MOFCOM”) and the State Administration for Market Regulation (國家市場監督管理總局) (the “SAMR”) jointly promulgated the Measures for Reporting of Information on Foreign Investment (外商投資信息報告辦法), which came into effect on 1 January 2020, pursuant to which, the establishment of a the foreign-invested enterprise, including establishment through purchasing the equities of a domestic non-foreign-invested enterprise or subscribe to the increased capital of a domestic non-foreign-funded enterprise, and its subsequent changes are required to submit an initial or change report through the Enterprise Registration System.

The Provisions on Guiding the Orientation of Foreign Investment (指導外商投資方向規定), which was promulgated by the State Council on 11 February 2002 and became effective on 1 April 2002, categorises all foreign-invested projects into encouraged, permitted, restricted and

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REGULATIONS ON PROPERTY MANAGEMENT SERVICE

Regulations on the Qualification of the Property Management Enterprise

According to the Regulations on Property Management (物業管理條例), which was promulgated by the State Council on 8 June 2003 and was amended on 26 August 2007, 6 February 2016 and 19 March 2018, to strengthen the credit management of the industry, the State Council’s construction administration department, together with other relevant departments, shall establish a system of joint incentive for honesty and joint punishment for dishonesty.

According to the Measures for the Administration on Qualifications of Property Management Enterprises (物業服務企業資質管理辦法), which was promulgated by the Ministry of Construction (repealed) on 17 March 2004 and last amended on 4 May 2015 and abolished on 8 March 2018, a system of qualification administration was once adopted and the qualifications of property management enterprises were classified into first, second and third grades.

On 19 November 2015, the General Office of the State Council promulgated the Guiding Opinions of the General Office of the State Council on Accelerating the Development of the Personal Service Industry to Promote the Upgrading of Consumption Structure (國務院辦公廳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), which sets out the general requirements, the main tasks and the policy measures to accelerate the development of personal services and upgrade consumption structures. The main tasks focus on the development of the living services that are closely related to the people’s livelihood with vast demand potential and strong driving forces, among others, to promote the standardisation of the real estate intermediary, house leasing, property management, moving and cleaning, household vehicles maintenance and other personal services.

According to the Decision of the State Council on Cancelling the Third Batch of Administrative Licencing 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), which was promulgated by the State Council on 12 January 2017, the examination and approval of second grade or lower qualifications of property management enterprises were cancelled. According to the Decision of the State Council on Cancelling a Group of Administrative Licencing Items (國務院關於取消一批行政許可事項的決定), which was promulgated by the State Council on 22

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September 2017, the examination and approval of the first-grade qualification of property management enterprises were cancelled.

According to the Notice of the General Office of the Ministry of Housing and Urban-Rural Development (中華人民共和國住房和城鄉建設部) (the “MOHURD”) on Effectively Implementing the Work of Cancelling 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), which was promulgated by the General Office of the MOHURD on 15 December 2017, application, change, renewal or re-application of the qualifications of property management enterprises shall not be accepted, and the qualifications shall not be a requirement for property management enterprises to undertake new property management projects. The real estate administration departments 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, the supervision of property management enterprises will be based on credit appraisal.

On 8 March 2018, the Decision of the MOHURD on Abolishing Measures for the Administration on Qualification of Property Management Enterprises (住房城鄉建設部關於廢止《物業服務企業資質管理辦法》的決定), which came into effect on 8 March 2018, abolished Measures for the Administration on Qualification of Property Management Enterprises and cancelled the accreditation of qualifications of property management enterprises.

Regulations on Appointing the Property Management Enterprise

On 28 May 2020, the NPC approved the Civil Code of the PRC (中華人民共和國民法典) (the “Civil Code”), which came into effect on 1 January 2021, and replace the Property Law of the PRC (中華人民共和國物權法), the Contract Law of the PRC (中華人民共和國合同法) and several other basic civil laws of the PRC. According to the Civil Code, property owners can either manage the buildings and the ancillary facilities by themselves or entrust to property management enterprises or other managers. Property owners are entitled to replace the property management enterprises or other managers employed by the developer. Property management enterprises or other managers should manage the buildings and the ancillary facilities within the building zone in accordance with the commission of the owners, subject to supervision by the owners. In addition, a quorum for the general meeting of the property owners to engage or dismiss a property management enterprise, to change the usage of common space or to conduct operating activities in common space or to decide for certain other matters shall consist of the property owners who hold no less than two-thirds of the total GFA (Gross Floor Area) of the exclusive area of the community and represent no less than two-thirds of the total number of property owners. A general meeting of the property owners of a community can engage or dismiss a property management enterprise with affirmative votes of property owners who participate in the voting and hold more than half of the total GFA of the exclusive area owned by the voting owners and who represent more than half of the total number of property owners participating in the voting. For other matters, such as changing the usage of common space or conducting operating activities in common space, the approvals requires the affirmative votes of property owners who participate in the voting and hold more than three-fourths of the total GFA of the exclusive area owned by the voting owners and who represent more than three-fourths of the total number of property owners participating in the voting.

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Pursuant to the Regulations on Property Management, before the engagement of a property management enterprise by property owners or the property owners’ general meeting, a written preliminary property management service contract should be entered into between the construction entity (for example, a property developer) and the selected property management enterprise. A sales contract concluded by the construction entity and the realty buyer shall include the contents stipulated in the preliminary service contract. Where, prior to the expiration of the service term stipulated in the preliminary property management service contract, the property management contract entered into between the property owners’ association and the property management enterprise becomes effective, the preliminary property management service contract shall be terminated. In addition, according to the Civil Code, the preliminary property management service contract entered into by and between the construction entity and the property management enterprise pursuant to the law, or the property service contract entered into by and between the property owners’ association and the property service provider selected by the property owners’ general meeting in accordance with the law shall be legally binding on the property owners.

According to the Interim Measures for Bid-Inviting and Bidding Management of Preliminary Property Management (前期物業管理招標投標管理暫行辦法), which was promulgated by the Ministry of Construction on 26 June 2003 and came into effect on 1 September 2003, preliminary property management services shall be implemented by the property management enterprise employed by the construction entity before the property owners or the property owners’ general meeting select a property management enterprise at its own discretion. The construction entity of any residential and the non-residential buildings located in the same property management area shall select the property management enterprises with the corresponding qualification through bid-invitation and bidding. In cases where there are no more than three bidders or the residence scale is relatively small, the construction entity may appoint the property management enterprise with the corresponding qualifications through agreement upon approval by the administrative department of real estate of the people’s government of the place where the property is located. For projects of newly built and currently marketable commodity housing, the bid-invitation and the bidding shall be completed within 30 days before they are put on sale. For projects of presale commodity housing, the bid-invitation and bidding shall be completed before the acquisition of Licence for Presale of Commodity Housing (商品房預售許可證). For projects of newly built real estates that are not for sale, the bid-invitation and bidding shall be completed within 90 days before they are delivered for use.

Regulations on the Fees Charged by the Property Management Enterprise

According to the Administrative Measures for Property Service Charges (物業服務收費管理辦法) (the “Administrative Measures”), which was jointly promulgated by the NDRC and the Ministry of Construction on 13 November 2003 and came into effect on 1 January 2004, property management enterprises are permitted to charge property service fees from property owners for repairing, maintaining, managing houses, ancillary facilities, equipment and ensuring the sanitation of relevant areas according to property management contracts. In addition, 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 different property and apply the government guidance price or market-regulated prices accordingly. Specific pricing rules shall be determined by competent price departments under the people’s governments of all

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Pursuant to the Administrative Measures, as agreed between the property owners and property management enterprise, the fees for property management services can be charged either as lump sum basis (包幹制), in which case property owners pay fixed property management fees to property management enterprise who shall enjoy all the profits or assume losses as its own risk, or as commission basis (酬金制), in which case property management enterprise may collect its service fees in the proportion or amount as agreed from the property management income in advance, the rest of which shall be exclusively used on the items as stipulated in the property management contract, and property owners shall enjoy the surplus or assume the shortage. Property management enterprises shall, pursuant to the applicable rules of the competent price departments under governments, clearly mark the prices of property services, and publish in a prominent position along with the information about services, criteria of services, charging items, charging criteria, etc.

According to the Administrative Measures and the relevant local regulations, where property service charges are priced under government guidance, the competent price government department together with the competent real estate department shall set the benchmark prices and the range of variations, depending on such factors as (i) types of property, which may include high-rise buildings with elevators and low-rise buildings without elevators, (ii) types of service provided, which may specify different types of services, such as landscaping, repairment and maintenance for common areas and elevator maintenance and (iii) the grading criteria of property service. For example, in Chongqing, the service charges on preliminary property management for residential properties, within the scope of the Chongqing Municipal Residential Property Service Grade Standards (重慶市住宅物業服務等級標準) (the “Standards”), shall be subject to the government guidance prices, while providing services that exceed the scope of the Standards can be adjusted by the market prices. However, due to types of property, the existing condition of the local property management market and local government departments’ policies with respect to the property management market, the government guidance prices in different cities or areas may vary.

According to the Circular of the NDRC on the Opinions for Decontrolling the Prices of Some Services (國家發展改革委關於放開部分服務價格意見的通知), which was promulgated by the NDRC on 17 December 2014 and came into effect on the same date, the competent price departments of all provinces, autonomous regions and municipalities shall perform procedures to liberalise the prices of the following types of services that have met the conditions for competition (i) property services of non-government-supported houses, including fees charged by a property management enterprise from property owners for the maintenance, conservation and management of non-government-supported houses, the supporting facilities, the equipment and the relevant sites thereof, activities of maintaining the environment, sanitation and order inside the property management regions and other actions completed in accordance with the agreement of the property service contract, upon the commission of the property owners; (ii) parking services in residential communities. In addition, the provincial price authorities shall, with the housing and urban-rural development administrative authorities, decide to implement government guidance prices for charges of property management for government-supported houses, houses under housing reform, old residence communities and preliminary property management service in light of the actual situation. In the case of

–96– 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. REGULATORY OVERVIEW decontrolling the charges of property services for government-supported houses, namely implementing market-regulated prices, the financial capacity of supported individuals shall be considered and a subsidy mechanism shall be established.

In recent years, the property management industry has generally seen supportive policies from the central and local governments that are aimed to stimulate the development of the sector, which included policy relaxation by local governments on price guidance. For example, in Fujian Province, in accordance with the Pricing Catalogue of Fujian Province (福建省定價目錄), the price control of property management services provided to non-government-supported houses was liberalised in February 2018. However, according to Pricing Catalogue of Chongqing Municipality (重慶市定價目錄), service charges on preliminary property management for residential properties in Chongqing Municipality shall still subject to government guidance prices.

According to the Regulation on Property Management Service Charges with Clear Price Tag (物業服務收費明碼標價規定), which was jointly promulgated by the NDRC and the Ministry of Construction on 19 July 2004 and came into effect on 1 October 2004, property management enterprises, during their provision of services to the property owners (including the property service as stipulated in the property management contract and other services requested by property owners), shall charge service fees at explicitly marked prices, and display their service items, standards and other related contents. In case there is any change to the pricing standard, the property management enterprise shall adjust the related content displayed and indicate the execution date of new standards one month prior to the implementation of the new standards.

According to the Measures on Supervision and Examination over Pricing Cost of Property Management Services (Trial) (物業服務定價成本監審辦法(試行)), which was jointly promulgated by the NDRC and the Ministry of Construction on 10 September 2007 and came into effect on 1 October 2007, the pricing cost of property management services should be the average cost of community property services as verified by the competent price administration department of the people’s government. The competent price administration department of the government is responsible for the supervision and examination over and investigation of the pricing of property management services with assistance from the competent property administration department. The pricing cost of property services should be composed of staff costs, the daily operation and maintenance costs of the common area and facilities of the property, gardening maintenance costs, sanitation and hygiene costs, security maintenance costs, insurance costs for the common areas and facilities (including liability insurance), office expenses, management costs apportionment, depreciation of fixed assets and other costs agreed by the property owners. The assessment of the pricing cost of property services should base on the annual financial and accounting reports audited by the certified public accounting firm, source documents, account books or the authentic, complete and valid cost materials provided by the property management enterprise.

Judicial Interpretation

According to Interpretation of the Supreme People’s Court on Several Issues Concerning the Specific Application of Law in Hearing Cases of Property Management Service Disputes (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), which was promulgated by the Supreme People’s Court on 15 May 2009 and amended on 29 December 2020, where the

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REGULATIONS ON PARKING SERVICE FEES

On 15 December 2015, the NDRC, the MOHURD and the Ministry of Transport of the PRC jointly issued the Guiding Opinions on Further Improving the Policies for Motor Vehicle Parking Service Charge (關於進一步完善機動車停放服務收費政策的指導意見), aiming to perfect a parking service charge mechanism with the price mainly determined by the market, promote a more systematic and scientific government pricing system, regulate the parking service charge and perfect the supporting supervision measures.

According to the Circular of NDRC on the Opinions for Decontrolling the Prices of Some Services (關於放開部分服務價格意見的通知), which was promulgated by NDRC on 17 December 2014 and came into effect on the same date, price control on parking services in residence communities was also cancelled.

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 specialised service enterprise, but it shall not outsource all the property management business within such area to third parties.

REGULATIONS ON SECURITY AND GUARDING SERVICES

According to the Regulation on the Administration of Security and Guarding Services (保安服務管理條例), which was promulgated by the State Council on 13 October 2009 and amended on 29 November 2020, the guard, patrol, order maintenance and other services in a property management region conducting by the personnel who are recruited by a property service enterprise is one of the security and guarding services. To apply for the establishment of a security and guarding service company, the applicant shall acquire the security and guarding service permit granted by the public security authority. Furthermore, an entity recruiting security guards by itself shall, within 30 days after the start of security and guarding services, file with the public security authority of the people’s government of the local districted city with the following materials (i) a certificate on the legal person status; (ii) basic information about the legal representative (chief person in charge), the divisional person in charge and the security guards; (iii) basic information about the security and guarding service area; and (iv) information about the establishment of security and guarding service management system, accountability system and security guard management system. Where such an entity no longer recruits security guards for security and guarding services, it shall, within 30 days from the date of termination of the security and guarding services, cancel the filing of service in the original public security authority. Moreover, where a security service company dispatches security guards to provide security and guarding services for its client across provisions, autonomous regions or municipalities, it shall file for record with the public security authority of people’s government of the city with districts where the service is located with its security and guarding

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REGULATIONS ON THE REAL ESTATE BROKERAGE BUSINESS

According to the Urban Real Estate Administration Law of the PRC (中華人民共和國城市房地產管理法), which was issued by the SCNPC on 5 July 1994 and came into effect on 1 January 1995 and revised on 30 August 2007, 27 August 2009 and 26 August 2019, real estate intermediate service agencies include real estate consultants, real estate evaluation agencies, real estate brokerage agencies, etc. A real estate intermediate agency shall meet the following conditions (i) has its own name and organisation; (ii) has a fixed business site; (iii) has the necessary assets and funds; (iv) has a sufficient number of professionals; and (v) other conditions specified by laws and administrative regulations.

According to the Administrative Measures for Real Estate Brokerage (房地產經紀管理辦法), which was issued by the MOHURD, the NDRC and the Ministry of Human Resources and Social Security (人力資源和社會保障部) (the “MOHRSS”) on 20 January 2011 and revised on 1 March 2016 and became effective on 1 April 2016, real estate brokerage refers to the acts of providing intermediary and agency services and collecting commissions from clients by real estate brokerage institutions and real estate brokers to promote real estate transactions. The establishment of a real estate brokerage institution or a branch of a real estate brokerage institution shall require enough number of real estate brokers, who are engaging in real estate brokerage activities. Furthermore, a real estate brokerage agency and its branches shall go to the competent housing and urban-rural development (real estate) authority for filing formalities within 30 days from the date of receiving the business licence.

REGULATIONS ON THE INTERNET INFORMATION SERVICES

Regulation on the Internet Information Services

According to the Administrative Measures on the Internet Information Services (互聯網信息服務管理辦法), which was issued by the State Council on 25 September 2000 and revised on 8 January 2011, the Internet information service refers to the provision of information through the Internet to web users. The Internet information service is divided into two categories, profitable and non-profitable Internet information service. Profitable Internet information service refers to the provision with the charge of payment of information through the Internet to web users or web page designing, etc. Non-profitable Internet information service, on the other hand, refers to the provision free of charge of public, commonly-shared information through the Internet to web users. That is, non-profitable internet information service providers shall not provide services with the charge of payment. Furthermore, an entity engaged in providing profitable Internet information service shall apply for a licence for value-added telecommunication services from the telecommunications administrative authority. As for the operation of non-profitable Internet information services, record-filing is required. The Internet information service providers shall provide services within the scope of their licences or filing. In case the Internet information service provider changes its services, website address, etc., it shall submit such changes within 30 days in advance at the original approving authority or record-filing authority.

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Regulation on Mobile Internet Application Information Services (APPs)

According to the Provisions on Administration of the Mobile Internet Applications 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 PRC (國家互聯網信息辦公室) (the “CAPRC”) on 28 June 2016 and came into effect on 1 August 2016, entities providing information services through the mobile Internet applications shall obtain relevant qualifications according to laws and regulations. The mobile Internet application providers and the Internet application store providers shall not use the mobile Internet applications to carry out activities prohibited by laws and regulations, such as endangering national security, disturbing public order and infringing upon other’s legal rights and interests, or use the mobile Internet applications to produce, copy, issue and spread illegal information prohibited by laws and regulations. In addition, the CAPRC shall be responsible for the supervision and administration of information on mobile Internet applications. The local cyberspace administrative authorities shall be responsible for the supervision and administration of information on the mobile Internet application program within the administrative regions.

REGULATIONS ON FOREIGN CURRENCY EXCHANGE

Regulations on Foreign Currency Exchange

According to the Administrative Regulation on Foreign Exchange of the PRC (中華人民共和國外匯管理條例), which was promulgated by the State Council on 29 January 1996, became effective on 1 April 1996 and last amended on 5 August 2008, RMB is freely convertible for payments of current items such as trade and service-related foreign exchange transactions and dividend payments. However, RMB is not freely convertible for capital items, such as direct investment, loans or investments in securities outside the PRC unless the approval from the State Administration of Foreign Exchange (國家外匯管理局) (the “SAFE”) or its local counterparts is obtained in advance.

On 30 March 2015, the SAFE promulgated the Circular on Reforming the Administration Measures on Conversion of Foreign Exchange Registered Capital of Foreign-invested Enterprises (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) (the “Circular 19”), which took into effect on 1 June 2015. The SAFE further promulgated the Circular on Reforming and Regulating Policies on the Control over Foreign Exchange Settlement of Capital Accounts (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) (the “Circular 16”) on 9 June 2016, which amended certain provisions of the Circular 19. According to the Circular 19 and the Circular 16, foreign exchange receipts under the capital account of domestic entities and its capital in RMB obtained from foreign exchange settlement shall not be used for business beyond its business scope or to provide loans to persons other than affiliates unless otherwise permitted under its business scope. Violations of the Circular 19 or the Circular 16 could result in administrative penalties.

On 18 January 2017, the SAFE promulgated the Circular on Improving the Examination of Authenticity and Compliance to Further Promote the Reform of Foreign Exchange (關於進一步推進外匯管理改革完善真實合規性審核的通知) (the “Circular 3”), which stipulates several capital control measures concerning the outbound remittance of profit from domestic entities to offshore entities, including (i) banks shall examine board resolutions regarding profit

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REGULATIONS ON INTELLECTUAL PROPERTY

Trademarks

Trademarks are protected by the Trademark Law of the PRC (中華人民共和國商標法) (the “Trademark Law”), which was promulgated by the SCNPC on 23 August 1982 and subsequently amended on 22 February 1993, 27 October 2001, 30 August 2013 and 23 April 2019, as well as the Implementation Regulation of the Trademark Law of the PRC (中華人民共和國商標法實施條例) (the “Implementation Regulation”) promulgated by the State Council on 3 August 2002 and amended on 29 April 2014. According to the Trademark Law and the Implementation Regulation, the Trademark Office of State Intellectual Property Office (國家知識產權局商標局) (the “Trademark Office”) handles trademark registrations and grants a term of ten years to registered trademarks and another ten years if requested upon expiry of the first or any renewed ten-year term. In addition, under the Trademark Law, the trademark registrant may licence its registered trademark to another party by entering into a trademark licencing agreement. The trademark licencing agreements must be filed with the Trademark Office to be recorded, while the non-filing of the licencing of a trademark shall not be used as a defence against a good faith third-party. The licensor shall supervise the quality of the commodities on which the licensee uses the registered trademark, and the licensee shall guarantee the quality of such commodities. Furthermore, the Trademark Law has adopted a “first-to-file” principle with respect to trademark registration. Where a trademark for which a registration has been made is identical or similar to another trademark that has already been registered or been subject to a preliminary examination and approval for use on the same kind of or similar commodities or services, the application for registration of such trademark may be rejected. Anyone who applies for trademark registration shall not infringe upon the existing rights of others nor register a trademark that has already been used by another party and has gained “a sufficient degree of reputation” in advance by illicit means.

Domain Names

According to the Measures on Administration of the Internet Domain Names (互聯網域名管理辦法), which was promulgated by the MIIT on 24 August 2017 and took effect on 1 November 2017, domain name owners are required to register their domain names and the MIIT is in charge of the administration of PRC Internet domain names. 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, and sign the registration agreements. Upon the completion of the registration process, the applicant will become the holder of such domain name.

According to the Copyright Law of the PRC (中華人民共和國著作權法) (the “Copyright Law”), which was promulgated by the SCNPC on 7 September 1990 and amended on 27 October

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2001, 26 February 2010 and 11 November 2020 (the latest revision became effective on 1 June 2021), and the Implementing Regulation of the Copyright Law of the PRC (中華人民共和國著作權法實施條例), which was promulgated by the National Copyright Administration on 30 May 1991 and amended on 2 August 2002, 8 January 2011 and 30 January 2013, the PRC nationals, legal persons and unincorporated organisations shall enjoy copyright in their works, whether published or not, which include, among others, works of literature, art, music, architecture, choreography and computer software. The copyright owner enjoys various kinds of rights, including the right of publication, right of authorship, and right of reproduction. Furthermore, any work of a foreigner or stateless person which acquires copyright under an agreement concluded between the PRC and the country to which the author belongs or in which the author permanently resides, or under an international treaty to which both countries are parties, shall be protected by the Copyright Law. Works of a foreigner or stateless person first published in the territory of the PRC shall be protected in accordance with the Copyright Law.

Patent

According to the Patent Law of the PRC (中華人民共和國專利法), which was issued by the SCNPC on 12 March 1984 and latest revised on 17 October 2020 (the revision became effective on 1 June 2021), and the Implementation Regulations of the Patent Law of the PRC (中華人民共和國專利法實施細則), which was issued on 19 January 1985 and last revised on 9 January 2010, the State Intellectual Property Office is responsible for managing patent work in the PRC. The patent management departments of the people’s governments of each province, autonomous region and municipality directly under the central government are responsible for the patent management in their respective administrative regions. Chinese patent system also adopts the principle of “first-to-file”, that is, where two or more applicants file applications for patent for the identical invention or creation respectively, the patent right shall be granted to the applicant whose application was filed first. An invention or utility model for which a patent is to be granted shall be novel, inventive and practically applicable. The validity period of a patent for an invention is 20 years, while the validity period of utility models and design is 10 years and 15 years respectively. Others may use the patent after obtaining the permit or proper authorisation of the patent holder, otherwise, such behaviour will constitute an infringement of the patent right.

REGULATIONS ON TAXATION

Enterprise Income Tax

According to the Enterprise Income Tax Law of the PRC (中華人民共和國企業所得稅法) (the “EIT Law”), which was promulgated by the NPC on 16 March 2007 and became effective on 1 January 2008 and amended on 24 February 2017 and 29 December 2018, and the Implementing Regulation of the Enterprise Income Tax of the PRC (中華人民共和國企業所得稅法實施條例) (the “Implementing Regulation”), which was promulgated by the State Council on 6 December 2007 and became effective on 1 January 2008 and was amended on 23 April 2019, the enterprise income tax rate shall be 25% and such tax rate shall be applied to domestic enterprises and foreign-invested enterprises. Pursuant to the EIT Law, enterprises are classified as “resident enterprises” and “non-resident enterprises”. Resident enterprises typically pay an enterprise income tax at the rate of 25%. Non-resident enterprises without any branches in the PRC should pay an enterprise income tax in connection with their income from the PRC at the tax rate of

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10%, however, enterprises established under the laws of foreign countries or regions whose “de facto management bodies” are located in the PRC are considered as resident enterprises and will generally be subject to enterprise income tax at the rate of 25% of their global income. The Implementing Regulation further defines “de facto management bodies” as “establishments that carry out substantial and overall management and control over production, operations, personnel, accounting and properties” of the enterprise.

Pursuant to the EIT Law, Enterprises qualified as “High and New Technology Enterprises” are entitled to a 15% enterprise income tax rate. The preferential tax treatment continues as long as an enterprise retains its “High and New Technology Enterprise” status. According to the Announcement of the State Administration of Taxation (國家稅務總局) (the “SAT”) on Issuing the Revised Measures for Handling Preferential Enterprise Income Tax (2018) (企業所得稅優惠政策事項辦理辦法(2018修訂)), which was promulgated by the SAT and came into effect on 25 April 2018, enterprises enjoying enterprise income tax preferences shall adopt the handling methods of “making independent judgement, declaring for enjoyment and retaining the relevant materials for future reference”. An enterprise shall, according to its operating condition and related tax provisions, independently determine whether it satisfies the conditions required for enterprise income tax preferences. Those who meet the conditions may independently calculate the tax deductions or exemptions according to the time listed in the Catalogue for the Administration of Enterprise Income Tax Preferences (Revision 2017) (企業所得稅優惠事項管理目錄(2017年版)), and enjoy tax incentives by filing enterprise income tax returns. Meanwhile, they shall, in accordance with the relevant provisions, collect and retain the relevant materials for future reference.

Dividends Withholding Tax

According to the EIT Law and its Implementing Regulation, dividends paid by foreign-invested companies to their foreign investors that are non-resident enterprises as defined under the law are subject to withholding tax at a rate of 10%, unless otherwise provided in the relevant tax agreements entered into with the central government of the PRC. Pursuant to the Arrangement Between the Mainland of China and the Hong Kong Special Administrative Region for the Avoidance of Double Taxation on Income and 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) (the “Double Tax Avoidance Arrangement”) promulgated on 21 August 2006 and applicable in Hong Kong to income derived in any year of assessment commencing on or after 1 April 2007 and in mainland China to any year commencing on or after 1 January 2007, if a Hong Kong resident enterprise is determined by the competent PRC tax authority to have satisfied the relevant conditions and requirements under the Double Tax Avoidance Arrangement, the withholding tax rate on the dividends the Hong Kong resident enterprise receives from a PRC resident enterprise may be reduced to 5%. However, based on the Notice of the SAT on Certain Issues Concerning the Enforcement of Dividend Provisions in Tax Treaties (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), which was promulgated and took into effect on 20 February 2009, by the SAT, if the relevant PRC tax authorities determine, in their discretion, that a company benefits from such reduced income tax rate due to a tax-driven structure or arrangement, such PRC tax authorities are entitled to adjust the preferential tax treatment.

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According to the Announcement of the SAT on Issues Concerning “Beneficial Owners” in Tax Treaties (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 by the SAT on 3 February 2018 and came into effect on 1 April 2018, a comprehensive analysis will be used to determine beneficial ownership based on the actual situation of a specific case combined with certain principles, and if an applicant is obliged to pay more than 50% of its income to a third country (region) resident within 12 months of the receipt of the income, or the business activities undertaken by an applicant fail to constitute substantive business activities including substantive manufacturing, distribution, management and other activities, the applicant is unlikely to be recognised as a beneficial owner to enjoy tax treaty benefits.

Enterprise Income Tax on Indirect Transfer of Non-Resident Enterprises

On 10 December 2009, the SAT issued the Circular on Strengthening the Administration of Enterprise Income Tax Concerning Proceeds from Equity Transfers by Non-Resident Enterprises (國家稅務總局關於加強非居民企業股權轉讓所得企業所得稅管理的通知) (the “Circular 698”). By implementing Circular 698, the PRC tax authorities have enhanced their scrutiny over the indirect transfer of equity interests in a PRC resident enterprise by a non-resident enterprise. The SAT further issued the Circular on Several Issues Concerning Enterprise Income Tax for Indirect Transfers of Assets by Non-Resident Enterprises (國家稅務總局關於非居民企業間接轉讓財產企業所得稅若干問題的公告) (the “Circular 7”) on 3 February 2015, to supersede existing provisions in relation to the indirect transfer as set forth in the Circular 698. The Circular 7 introduces a new tax regime that is significantly different from that under the Circular 698. According to the Circular 7, a non-resident enterprise indirectly transfers equities and other assets of a PRC resident enterprise to avoid the EIT payment obligation by making an arrangement with no reasonable business purpose, such indirect transfer shall be redefined and recognised as a direct transfer in accordance with the provisions of the EIT Law. Where the enterprise income tax on the income from the indirect transfer of real estate or indirect transfer of equities shall be paid in accordance with the provisions of the Circular 7, the entity or individual that directly assumes the obligation to make relevant payments to the transferor according to the provisions of the relevant laws or as agreed upon in the contract shall be the withholding agent.

On 17 October 2017, the SAT promulgated the Circular on Issues Concerning the Withholding of Enterprise Income Tax at Source on Non-Resident Enterprises (國家稅務總局關於非居民企業所得稅源泉扣繳有關問題的公告) (the “SAT Circular 37”), which came into force and replace the Circular 698 and certain other regulations on 1 December 2017. The SAT Circular 37 simplifies procedures of withholding and payment of income tax levied on non-resident enterprises.

Value-Added Tax

According to the Provisional Regulation on Value-Added Tax of the PRC (中華人民共和國增值稅暫行條例), which was promulgated by the State Council on 13 December 1993 and came into effect on 1 January 1994 and was amended on 10 November 2008, 6 February 2016 and 19 November 2017, and the Implementing Rules for the Provisional Regulation 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), which was promulgated by Ministry of Finance (the “MOF”) on 25 December 1993 and amended on 15 December 2008 and 28 October

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2011, all entities or individuals in the PRC engaging in the sale of goods, the provision of processing services, repairs and replacement services, the sale of services, intangible assets or immovable properties and the importation of goods are required to pay value-added tax.

Since 1 January 2012, the MOF and the SAT have implemented the Pilot Plan for Levying Value-Added Tax in Lieu of Business Tax (營業稅改徵增值稅試點方案), which imposes value-added tax in lieu of business tax for certain “modern service industries” in certain regions and eventually expanded to nationwide application in 2013. In accordance with the Notice on Fully Launch of the Pilot Plan 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), which was issued by the MOF and the SAT on 23 March 2016 and came into effect on 1 May 2016, the state started to fully implement the pilot plan from business tax to value-added tax on 1 May 2016. All taxpayers of business tax in the construction industry, real estate industry, financial industry and living service industry have been included in the scope of the pilot plan and should pay value-added at the rate of 6%, unless otherwise stipulated, instead of paying business tax.

REGULATIONS ON EMPLOYMENT AND SOCIAL WELFARE

The Labour Contract Law

According to the Labour Law of the PRC (中華人民共和國勞動法), which was promulgated by the SCNPC on 5 July 1994, becoming effect on 1 January 1995, and amended on 27 August 2009 and 29 December 2018, and the Labour Contract Law of the PRC (中華人民共和國勞動合同法) promulgated by the SCNPC on 29 June 2007, becoming effect on 1 January 2008 and amended on 28 December 2012 and effective from 1 July 2013, and the Regulation on the Implementation of the Labour Contract Law (中華人民共和國勞動合同法實施條例), which was promulgated by the State Council and came into effect on 18 September 2008, labour relationship between employers and employees must be executed in written form. Where a labour relationship has already been established but no formal contract has been made, a written labour contract shall be entered into within one month from the date when the employee begins to work. In addition, wages may not be lower than the local minimum wage standard. Employers must establish a system for labour safety and sanitation, strictly abide by State standards and provide relevant training to the employees. Employees also have the right to work in safe and sanitary conditions.

Social Insurance and Housing Fund

According to the Social Security Law of the PRC (中華人民共和國社會保險法), which was promulgated by the SCNPC on 28 October 2010 and came into effect on 1 July 2011 and revised on 29 December 2018, the Interim Regulation on the Collection and Payment of Social Insurance Premiums (社會保險費徵繳暫行條例), which came into effect on 22 January 1999 and revised on 24 March 2019, the Regulation on Work Injury Insurance (工傷保險條例) implemented on 1 January 2004 and amended on 20 December 2010, the Regulations on Unemployment Insurance (失業保險條例), which was promulgated on 22 January 1999, and the Trial Measures on Employee Maternity Insurance of Enterprises (企業職工生育保險試行辦法) implemented on 1 January 1995, the employer shall contribute to social insurance plans covering basic pensions insurance, basic medical insurance, maternity insurance, work injury insurance and unemployment insurance. Basic pension, medical and unemployment insurance contributions

– 105 – 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. REGULATORY OVERVIEW shall be paid by both employers and employees, while work injury insurance and maternity insurance contributions shall only be paid by employers, and employers who failed to promptly contribute social security premiums in full amount shall be ordered by the social security premium collection agency to make or supplement contributions within a prescribed time limit, and shall be subject to a late payment fine computed from the due date at the rate of 0.05% per day; where payment is not made within prescribed time limit, the relevant administrative authorities shall impose a fine ranging from one to three times the outstanding amount.

According to the Regulation on the Administration of Housing Provident Fund (住房公積金管理條例) (the “Regulation on Housing Provident Fund”), which was promulgated by the State Council and became effective on 3 April 1999 and amended on 24 March 2002 and 24 March 2019, enterprises in the PRC must register with the competent managing centre for housing provident funds and upon the examination by such centre, these enterprises shall complete procedures for opening an account at the bank for the deposit of employees’ housing provident funds. Enterprises are also required to pay and deposit housing funds on behalf of their employees in full and in a timely manner. Employers that violate the Regulation on Housing Provident Fund and fail to process housing provident fund payments or deposit registrations with the housing fund administration centre within a designated period are subject to a fine ranging from RMB10,000 to RMB50,000.

According to the Reform Plan of the State Tax and Local Tax Collection Administration System (國稅地稅徵管體制改革方案), which was promulgated by the General Office of the Communist Party of China and the General Office of the State Council of the PRC on 20 July 2018, from 1 January 2019, all the social insurance premiums, including the premiums of the basic pension insurance, unemployment insurance, maternity insurance, work injury insurance and basic medical insurance will be collected by the tax authorities. According to the Notice by the General Office of the SAT on Conducing 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), which was promulgated on 13 September 2018, and the Urgent Notice of the General Office of the MOHRSS on Implementing the Spirit of the Executive Meeting of the State Council in Stabilizing the Collection of Social Insurance Premiums (人力資源社會保障部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), which was promulgated on 21 September 2018, all the local authorities responsible for the collection of social insurance premiums are strictly forbidden to collect historical unpaid social insurance contributions from enterprises. In addition, the Notice of the SAT on Implementing Measures on 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), which was promulgated on 16 November 2018, repeats that tax authorities at all levels shall not organise the collection of arrears of taxpayers, private enterprises included, in the previous years.

REGULATIONS ON FOREIGN CURRENCY REGISTRATION OF OVERSEAS INVESTMENT BY PRC RESIDENTS

On 4 July 2014, the SAFE promulgated the Circular on Relevant Issues Relating to Domestic Residents’ Investment and Financing and Round-Trip Investment through Special Purpose Vehicles (關於境內居民通過特殊目的公司境外投融資及返程投資外匯管理有關問題的通知) (the “Circular 37”) to simplify the approval process and promote the cross-border investment. Under Circular 37, (i) before the PRC residents or entities conducting investment in offshore

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Failure to comply with the registration procedures set forth in the Circular 37 may result in restrictions imposed on the foreign exchange activities of the relevant onshore company, including the payment of dividends and other distributions to its offshore parent or affiliates, and may also subject relevant PRC residents to penalties under PRC foreign exchange administration regulations. PRC residents who control the company from time to time are required to register with the SAFE in connection with their investments in the company. Moreover, failure to comply with the various SAFE registration requirements described above could result in liability under PRC law for evasion of foreign exchange controls.

SAFE further promulgated Circular of the State Administration of Foreign Exchange on Further Simplifying and Improving the Policies of Foreign Exchange Administration Applicable to Direct Investment (國家外匯管理局關於進一步簡化和改進直接投資外匯管理政策的通知) (the “Circular 13”) on 13 February 2015, which came into effect on 1 June 2015, and allows PRC residents or entities to register with qualified banks in connection with their establishment or control of an offshore entity established for the purpose of overseas investment or financing. SAFE and its branches shall perform indirect regulation over the foreign exchange registration via above-mentioned qualified banks.

REGULATIONS ON M&A RULES

On 8 August 2006, six PRC regulatory agencies, including the MOFCOM, State-owned Assets Supervision and Administration Commission of the State Council, SAT, State Administration for Industry and Commerce (repealed), China Securities Regulatory Commission(中國證券監督管理委員會) (the “CSRC”) and SAFE, issued the Regulations on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors (關於外國投資者併購境內企業的規定) (the “M&A Rules”), which took into effect on 8 September 2006 and was amended by the MOFCOM on 22 June 2009. According to the M&A Rules, Foreign investors shall comply with the M&A Rules (i) when they purchase equity interests of a domestic enterprise or subscribe to the increased capital of a domestic enterprise; (ii) when the foreign investors establish a foreign-invested enterprise in the PRC, purchase the assets of a domestic enterprise and operate such assets; (iii) when the foreign investors purchase the asset of a domestic enterprise by agreement and use such assets as an investment to establish a foreign-invested enterprise to operate such assets.

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OUR HISTORY AND DEVELOPMENT

Overview

Our history can be traced back to 2006 when our first operating subsidiary, Chongqing Ronghui PM, started to provide property management services for properties developed by Ronghui Group, which is controlled by Mr. Wong and Ms. Chan, our ultimate Controlling Shareholders. Ronghui Group has over 17 years of property development experience and has comprehensive business offerings covering various industries including property development, landscape engineering, chemical production and hotel investment and operation. Following Ronghui Group’s expansion of its property portfolio to include commercial properties, we expanded our service scope to providing commercial operational services in 2008. Since our inception, we have expanded the geographic coverage of our services across different regions in China.

As at 31 December 2020, we had been contracted to provide property management services in Chongqing, Jinan, Fuzhou and Wuhu to 57 projects with a total contracted GFA of approximately 8.3 million sq.m. With respect to our commercial operational services, as at 31 December 2020, we had been contracted to provide commercial operational services to 13 projects in Chongqing, Fuzhou, Fujian Province, and Jinan, Shandong Province with a total contracted GFA of approximately 0.3 million sq.m.

Key Business Development Milestones

The following is a summary of the key business development milestones of our Group: Year Events

2006 Chongqing Ronghui PM was established in Chongqing and commenced to provide residential property management services in Chongqing to properties developed by Chongqing Ronghui Properties

2007 We started to manage properties in Fujian Province

2008 We started to provide commercial operational services to commercial properties owned by Ronghui Group

2009 Ronghui Peninsula (融匯半島), a project managed by us, was named a “Property Management Exemplary Community” (物業管理示範社區) by Chongqing Municipal Land Resources and Housing Bureau

2010 Chongqing Ronghui PM obtained the ISO9001 qualification certification

2011 Ronghui Shanshui (融匯山水), a project managed by us, was named a “Fujian Province Property Management Exemplary Community” (福建省物業管理示範社區) by Housing and Urban-Rural Development Department of Fujian Province

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Year Events

2012 We started to manage residential and commercial properties in Jinan, Shandong Province

We started to manage commercial properties in Chongqing

2014 We started to manage properties developed by Independent Third Parties

2015 Chongqing Ronghui Hot Spring City-Shangquanfang (重慶融匯溫泉城－上泉坊), a project where we provide commercial operational services, was named a “Chongqing Time-honoured Characteristic Commercial Cluster” (重慶老字號特色商業集聚區) by Chongqing Municipal Commission of Commerce

2017 Fujian Ronghui PM formed a joint venture with Fujian Funeng Community Commercial Management Co., Ltd. (福建福能社區商業管理有限公司), a subsidiary of Fujian Energy Group Ltd. (福建省能源集團有限責任公司), which started to manage properties owned by a state-owned enterprise, including residential properties, industry parks and offices.

Ronghui Hot Spring Town (融匯溫泉小鎮), a project managed by us, was named a “National AAAA Tourist Attraction” (國家4A級旅遊景區)

2018 We were ranked 65th among the China Top 100 Property Service Companies (中國物業服務百強企業)byCIA

2019 We launched the “Xiaohui Dangjia” (小匯當家) smart community platform

We were ranked 59th among the China Top 100 Property Management Companies (中國物業服務百強企業)byCIA

2020 We were recognised as one of the China Featured Property Service Excellent Enterprise for Composite Property Operations (中國特色物業服務領先企業—複合大盤運營服務)byCIA

We were ranked 55th among the China Top 100 Property Management Companies (中國物業服務百強企業)byCIA

We were recognised as an Excellent Brand of China Commercial Property Service (中國商業物業服務優秀品牌)byCIA

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Year Events

2021 We were ranked 50th among the China Top 100 Property Management Companies (中國物業服務百強企業) by CIA.

We acquired Chongqing Xintianyuan, resulting in an increase in our contracted GFA by approximately 851,248.9 sq.m.

Our Corporate Development

As at the Latest Practicable Date, our Group had either established or acquired operating subsidiaries in the PRC to carry out our business. The major corporate developments of those of our subsidiaries which were material to our performance during the Track Record Period are set out below:

Chongqing Ronghui PM

Chongqing Ronghui PM was established in the PRC on 23 June 2006 with an initial registered capital of RMB5.0 million. It is the onshore holding company of the property management entities of our Group and principally engaged in the provision of property management services. Upon its establishment, Chongqing Ronghui PM was wholly owned by Chongqing Ronghui Industrial Co., Ltd. (重慶融匯實業有限公司)(“Chongqing Ronghui Industrial”), a company controlled by Mr. Wong and Ms. Chan, both our Controlling Shareholders. Chongqing Ronghui Properties, a company indirectly wholly owned by Mr. Wong and Ms. Chan, being the registered holder of 22.6% of the equity interest of Chongqing Ronghui Industrial, had held 3.3% of such interests in Chongqing Ronghui Industrial as nominee on trust for Mr. Chen Zhong, our non-executive Director, due to certain financing arrangements between Mr. Chen Zhong and Ronghui Group.

On 22 August 2019, the registered share capital of Chongqing Ronghui PM was increased to RMB20.0 million with a capital injection of RMB15.0 million by Chongqing Ronghui Industrial.

On 11 March 2021, the registered capital of Chongqing Ronghui PM was reduced from RMB20.0 million to RMB10.0 million by way of repurchase of RMB10.0 million interest held by Chongqing Ronghui Industrial. Chongqing Ronghui PM remained wholly owned by Chongqing Ronghui Industrial following such capital reduction.

As part of the Reorganisation, on 1 April 2021, Chongqing Ronghui Industrial transferred the entire equity interest of Chongqing Ronghui PM to Ronghui Youjia. Upon completion of such transfer, Chongqing Ronghui PM became indirectly wholly-owned by our Company. See the paragraph headed “—Reorganisation—3. Acquisition of Ronghui Guanling and Chongqing Ronghui PM by Ronghui Youjia” below for details.

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Ronghui Guanling

Ronghui Guanling was established in the PRC on 2 May 2013 with an initial registered capital of RMB20.0 million. It is the onshore holding company of the commercial operational business entities of our Group and principally engaged in the provision of commercial operational services. Upon its establishment, Ronghui Guanling was owned as to 1% by Chongqing Ronghui Hot Spring Industry Development Co., Ltd. (重慶融匯溫泉產業發展有限公司)(“Ronghui Hot Spring”) and 99% by Chongqing Ronghui Investment Co., Ltd. (重慶融匯投資有限公司)(“Chongqing Ronghui Investment”). Each of Ronghui Hot Spring and Chongqing Ronghui Investment is wholly owned by Chongqing Ronghui Properties.

Following a capital injection of RMB140.0 million by Chongqing Ronghui Properties on 1 December 2014, the registered capital of Ronghui Guanling was increased to RMB160.0 million, and Ronghui Guanling became owned as to 87.5% by Chongqing Ronghui Properties, 0.125% by Ronghui Hot Spring and 12.375% by Chongqing Ronghui Investment.

On 10 February 2021, the registered capital of Ronghui Guanling was reduced from RMB160.0 million to RMB20.0 million by way of repurchase by Ronghui Guanling of approximately RMB122.5 million of the equity interest held by Chongqin Ronghui Properties, RMB0.2 million interest held by Ronghui Hot Spring and RMB17.3 million interest held by Chongqin Ronghui Investment. The shareholding of Ronghui Guanling remained unchanged upon completion of such capital reduction.

As part of the Reorganisation, on 2 April 2021, each of Chongqing Ronghui Properties, Ronghui Hot Spring and Chongqing Ronghui Investment transferred its respective interest in Ronghui Guanling to Ronghui Youjia. Upon completion of such transfers, Ronghui Guanling became indirectly wholly owned by our Company. See the paragraph headed “—Reorganisation—3. Acquisition of Ronghui Guanling and Chongqing Ronghui PM by Ronghui Youjia” below for details.

Fujian Ronghui PM

Fujian Ronghui PM was established in the PRC on 22 January 2007 with an initial registered capital of RMB5.0 million. It is principally engaged in the provision of property management services. Upon its establishment, Fujian Ronghui PM was owned as to 95% by Ronghui Fujian, a company ultimately wholly owned by Mr. Wong and Ms. Chan, both our Controlling Shareholders, and 5% by Ms. Chan.

On 26 December 2007, Ms. Chan transferred her 5% interest in Fujian Ronghui PM to Ronghui (Fujian) Industrial Development Co., Ltd. (融匯（福建）實業發展有限公司)(“Ronghui Fujian Industrial Development”), a company then beneficially wholly owned by Mr. Wong and Ms. Chan, at a total consideration of RMB50,000, which was determined after arm’s length negotiations with reference to its paid-up capital as at the time of transfer. Upon completion of such transfer, Fujian Ronghui PM became owned as to 95% by Ronghui Fujian and 5% by Ronghui Fujian Industrial Development.

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As part of the Reorganisation, on 6 April 2021, each of Ronghui Fujian and Ronghui Fujian Industrial Development transferred its respective interest in Fujian Ronghui PM to Chongqing Ronghui PM. Upon completion of such transfers, Fujian Ronghui PM became indirectly wholly owned by our Company. See the paragraph headed “—Reorganisation—4. Acquisition of PRC operating entities” below for details.

Shandong Ronghui LSB

Shandong Ronghui LSB was established in the PRC on 17 July 2012 with an initial registered capital of RMB5.0 million. It is principally engaged in the provision of commercial operational services. Upon its establishment, Shandong Ronghui LSB was wholly owned by Shandong Ronghui Real Estate Co., Ltd. (山東融匯房地產有限公司)(“Shangdong Ronghui Real Estate”), a company ultimately controlled by Mr. Wong and Ms. Chan, both our Controlling Shareholders.

As part of the Reorganisation, on 6 April 2021, Shandong Ronghui Real Estate transferred its entire interest in Shandong Ronghui LSB to Ronghui Guanling. Upon completion of such transfer, Shandong Ronghui LSB became indirectly wholly owned by our Company. See the paragraph headed “—Reorganisation—4. Acquisition of PRC operating entities” below for details.

ACTING-IN-CONCERT AGREEMENT

On 24 June 2021, Mr. Wong and Ms. Chan entered into an acting-in-concert agreement, whereby they agreed and confirmed that among other things, during the period starting from when they became the registered owners and/or beneficial owners of the interests in our Group to the date when any one of them ceases to be our Controlling Shareholder, they have been acting in concert and will continue to act in concert in respect of the management and control of our Group, including but not limited to the exercise of the voting rights at shareholders’ meetings of each member company within our Group unanimously in accordance with the consensus achieved among them. Prior to voting on any resolutions in shareholders’ meetings of each member company within our Group, Mr. Wong and Ms. Chan had discussed and will discuss the relevant matters with one another with a view to reaching consensus and an unanimous vote.

–112– REORGANISATION DOCUMENT. THIS BE OF MUST COVER INFORMATION THE THE ON THAT “WARNING” AND HEADED CHANGE SECTION TO THE SUBJECT WITH AND CONJUNCTION INCOMPLETE IN FORM, READ DRAFT IN IS DOCUMENT THIS The following diagram illustrates our shareholding structure before the Reorganisation: ITR,ROGNSTO N OPRT STRUCTURE CORPORATE AND REORGANISATION HISTORY,

Ms. Chan (Note 1) Mr. Wong (Note 1) Zheng Lidong

45% 55%

25.64%

Ronghui International 74.36% Hong Kong Ronghui Investment Holding Investment Limited Limited (Hong Kong) (Hong Kong) Offshore

100% Onshore Ronghui Fujian Industrial Development (PRC)

39% 5% 100%

95% 61% Wuhu Ronghui Fujian Ronghui PM Ronghui Fujian Wong Fung Chun Lin Zhongmin (Note 3) Properties Co., Ltd. Pei Luyang (Notes 1, 3) (PRC) (PRC) (Notes 1, 3) (PRC)

100% 50% 100% 100% 1% Wuhu Ronghui Chongqing Jiayou Chongqing Ronghui 99% Funeng Ronghui Property Management Fuzhou Ronghui Investment Co., Ltd. Properties (Note 2) (PRC) Co., Ltd. (PRC) (PRC) (PRC) (PRC) –113–

100% 20% 22.6% (Note 4) 100% 87.5% 99.91% Fuzhou Huixiang 5.9% Chongqing Ronghui 66% Chongqing Ronghui 12.375% 0.125% Wuhu Ronghui Trading Ronghui Guanling Ronghui Hot Spring Information 80% Industrial (Note 5) Investment Co., Ltd. (Note 6) (PRC) (PRC) Technology Co., Ltd. (PRC) (PRC) (PRC) (PRC) 0.09%

100% 100% 100% 95%

Chongqing Ronghui Shandong Ronghui Shandong Ronghui 5% Ronghui CM PM Real Estate Properties Chen Zhong (PRC) (PRC) (PRC) (PRC)

100% 100%

Shandong Ronghui Chongqing Botu Ronghui Cultural Enterprises Management LSB (PRC) Consulting Co., Ltd. (PRC) (PRC)

Notes: 1. Ms. Chan is the spouse of Mr. Wong. Pei Luyang is the spouse of Ms. Wong Tan Ching, our executive Director, and the son-in-law of Mr. Wong and Ms. Chan. Wong Fung Chun is the sister of Mr. Wong. 2. The remaining equity interest is held by Fujian Funeng Community Commercial Operation Management Co., Ltd. (福建福能社區商業管理有限公司), an Independent Third Party (other than being a substantial shareholder of Funeng Ronghui). 3. Such interest was held on trust on behalf of Ronghui Fujian. 4. Includes a 3.3% interest held as nominee on trust for Mr. Chen Zhong, our non-executive Director. 5. The remaining interest is held as to 3.3% by Mr. Cheng Xi, an Independent Third Party, and as to 2.2% by another Independent Third Party. 6. Wuhu Ronghui Trading Co., Ltd. (蕪湖融匯商貿有限公司) subsequently became deregistered on 8 December 2020 due to cessation of its business. 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, REORGANISATION AND CORPORATE STRUCTURE

In preparation for the [REDACTED], the following steps were implemented to establish the structure of our Group:

1. Establishment of Ronghui Youjia

Ronghui Youjia was established in the PRC as a limited liability company on 12 January 2021 with an initial registered capital of RMB10.0 million. As at the date of its establishment, Ronghui Youjia was owned as to 95% by Chongqing Ronghui Properties, a company ultimately owned as to 55% by Mr. Wong and 45% by Ms. Chan and 5% by Chongqing Botu Enterprises Management Consulting Co., Ltd. (重慶伯圖企業管理諮詢有限公司)(“Botu Consulting”), a company directly wholly owned by Mr. Chen Zhong, our non-executive Director.

2. Reduction of registered capital of certain operating subsidiaries

On 10 February 2021, the registered capital of Ronghui Guanling was reduced from RMB160.0 million to RMB20.0 million by way of repurchase by Ronghui Guanling of approximately RMB122.5 million of the equity interest held by Chongqing Ronghui Properties, RMB0.2 million of the equity interest held by Ronghui Hot Spring and RMB17.3 million of the equity interest held by Chongqing Ronghui Investment. The shareholding of Ronghui Guanling remained unchanged following such reduction of registered capital.

On 3 March 2021, the registered capital of Ronghui Cultural was reduced from RMB60.0 million to RMB10.0 million by way of repurchase by Ronghui Cultural of RMB50.0 million of the equity interest held by Shandong Ronghui Properties. The shareholding of Ronghui Cultural remained unchanged following such reduction of registered capital.

On 3 March 2021, the registered capital of Fuzhou Ronghui was reduced from RMB8.0 million to RMB3.0 million by way of repurchase by Fuzhou Ronghui of RMB4.95 million of the equity interest held by Pei Luyang and RMB0.05 million of the equity interest held by Wong Fung Chun. The shareholding of Fuzhou Ronghui remained unchanged following such reduction of registered capital.

On 11 March 2021, the registered capital of Chongqing Ronghui PM was reduced from RMB20.0 million to RMB10.0 million by way of repurchase by Chongqing Ronghui of RMB10.0 million of the equity interest held by Chongqing Ronghui Industrial. The shareholding of Chongqing Ronghui PM remained unchanged following such reduction of registered capital.

3. Acquisition of Ronghui Guanling and Chongqing Ronghui PM by Ronghui Youjia

On 1 April 2021, Ronghui Youjia acquired the entire equity interest of Chongqing Ronghui PM from Chongqing Ronghui Industrial at a consideration of RMB10.0 million. Such consideration was determined after arm’s length negotiations having considered the registered capital of Chongqing Ronghui PM as at the time of transfer, and had been fully settled as at the Latest Practicable Date. Upon completion of such acquisition, Chongqing Ronghui PM became a direct wholly-owned subsidiary of Ronghui Youjia.

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On 2 April 2021, Ronghui Youjia acquired the entire equity interest in Ronghui Guanling from Chongqing Ronghui Properties, Chongqing Ronghui Investment and Ronghui Hot Spring, at a total consideration of RMB20.0 million. Such consideration was determined after arm’s length negotiations having considered the registered capital of Ronghui Guanling as at the time of transfer, and had been fully settled as at the Latest Practicable Date. Upon completion of such acquisition, Ronghui Guanling became a direct wholly-owned subsidiary of Ronghui Youjia.

4. Acquisition of PRC operating entities

On 1 April 2021, Ronghui Guanling acquired the entire equity interest of Ronghui CM from Chongqing Ronghui Industrial at a consideration of RMB10.0 million. Such consideration was determined after arm’s length negotiations having considered the registered capital of Ronghui CM as at the time of transfer, and had been fully settled as at the Latest Practicable Date. Upon completion of such acquisition, Ronghui CM became a direct wholly-owned subsidiary of Ronghui Guanling. Ronghui CM is principally engaged in the provision of commercial operational services.

On 6 April 2021, Ronghui Guanling acquired the entire equity interest of Shandong Ronghui LSB from Shandong Ronghui Real Estate, at a consideration of RMB5.0 million. Such consideration was determined after arm’s length negotiations having considered the registered capital of Shandong Ronghui LSB as at the time of transfer, and had been fully settled as at the Latest Practicable Date. Upon completion of such acquisition, Shandong Ronghui LSB became a direct wholly-owned subsidiary of Ronghui Guanling.

On 6 April 2021, Ronghui Guanling acquired the entire equity interest of Ronghui Cultural from Shandong Ronghui Properties at a consideration of RMB10.0 million. Such consideration was determined after arm’s length negotiations having considered the registered capital of Ronghui Cultural as at the time of transfer, and had been fully settled as at the Latest Practicable Date. Upon completion of such acquisition, Ronghui Cultural became a direct wholly-owned subsidiary of Ronghui Guanling. Ronghui Cultural is principally engaged in the provision of commercial operational services.

On 6 April 2021, Chongqing Ronghui PM acquired the entire equity interest of Fujian Ronghui PM from each of Ronghui Fujian Industrial Development and Ronghui Fujian, at a total consideration of RMB5.0 million. Such consideration was determined after arm’s length negotiations having considered the registered capital of Fujian Ronghui PM as at the time of transfer, and had been fully settled as at the Latest Practicable Date. Upon completion of such acquisition, Fujian Ronghui PM became a direct wholly-owned subsidiary of Chongqing Ronghui PM.

On 14 April 2021, Ronghui Guanling acquired the entire equity interest of Fuzhou Ronghui from each of Mr. Pei Luyang, the son-in-law of Mr. Wong and Ms. Chan, and Ms. Wong Fung Chun, the sister of Mr. Wong, at a total consideration of RMB3.0 million. Mr. Pei Luyang and Ms. Wong Fung Chun, being the registered holders of the entire equity interest of Fuzhou Ronghui, had held such interests in Fuzhou Ronghui as nominees on trust for Ronghui Group. Since its establishment, Fuzhou Ronghui has been held through entrustment arrangements for the purpose of administrative convenience, initially by an entrusted employee of Ronghui Group and a close relative of Ms. Chan, and subsequently by Mr. Pei Luyang and Ms. Wong Fung Chun. The consideration for such transfer was determined after arm’s length negotiations

–115– 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, REORGANISATION AND CORPORATE STRUCTURE having considered the registered capital of Fuzhou Ronghui as at the time of transfer, and had been fully settled as at the Latest Practicable Date. Upon completion of such acquisition, Fuzhou Ronghui became a direct wholly-owned subsidiary of Ronghui Guanling. Fuzhou Ronghui is principally engaged in the provision of commercial operational and property management services.

5. Incorporation and shareholding changes of our Company

Our Company was incorporated in the Cayman Islands on 1 February 2021 as an exempted company with limited liability. As at the date of incorporation, the authorised share capital of our Company was HK$380,000 divided into 38,000,000 ordinary shares of HK$0.01 each. Upon incorporation, one fully-paid Share was allotted and issued at par to the initial subscriber, an Independent Third Party. On 4 February 2021, the one Share was transferred at par to WC-Holding, a BVI company indirectly owned as to 55% by Mr. Wong and 45% by Ms. Chan through WC-BVI, following which 59 Shares were allotted and issued to WC-Holding. On the same date, four Shares and four Shares were allotted and issued to Wong-Holding and Chan-Holding, respectively. Wong-Holding is indirectly wholly owned by Mr. Wong through Wong-BVI. Chan-Holding is indirectly wholly owned by Ms. Chan through Chan-BVI. Upon completion of such allotment and issuance, our Company became owned as to approximately 88.2% by WC-Holding and 5.9% by each of Wong-Holding and Chan-Holding.

On 3 June 2021, for the purpose of reflecting the respective interests of Mr. Chen Zhong, our non-executive Director, and Mr. Cheng Xi, an Independent Third Party, in certain of our onshore operating entities since 2007 and 2017, respectively, 259 Shares and 245 Shares were allotted and issued at par to Kaba Company Limited (“CZ-BVI”), a BVI company directly wholly owned by Mr. Chen Zhong, and Staraust Development Limited (“Cheng-BVI”), a BVI company directly wholly owned by Mr. Cheng Xi, respectively. On the same date, 1,596 Shares were allotted and issued to Wong-Holding at a subscription amount of HK$12.2 million, and 6,236 Shares and 1,596 Shares were allotted and issued to each of WC-Holding and Chan-Holding at par, respectively. Upon completion of such allotment and issuance, our Company became owned as to 62.96% by WC-Holding, 16.00% by Wong-Holding, 16.00% by Chan-Holding, 2.59% by CZ-BVI and 2.45% by Cheng-BVI. Each of (i) Mr. Chen Zhong and CZ-BVI; and (ii) Mr. Cheng Xi and Cheng-BVI, [have undertaken] to our Company and the [REDACTED] that they will not dispose of the Shares held by them directly or indirectly upon [REDACTED] for a period of six months commencing from the date of [REDACTED].

6. Incorporation of offshore intermediate holding subsidiaries

On 3 February 2021, Ronghui BVI was incorporated in the BVI with limited liability and is authorised to issue up to 50,000 ordinary shares of a single class without par value. As at the date of incorporation, 100 shares were issued to our Company at a subscription price of US$100. Upon completion of such allotment and issuance, Ronghui BVI became directly wholly owned by our Company.

On 18 February 2021, Ronghui HK was incorporated in Hong Kong as a limited liability company. On the same date, 10,000 shares of Ronghui HK were allotted and issued to Ronghui BVI at a subscription price of HK$10,000. Upon completion of such allotment and issuance, Ronghui HK became directly wholly-owned by Ronghui BVI and an indirect wholly-owned subsidiary of our Company.

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7. Establishment of Ronghui Jiayue

On 4 March 2021, Ronghui Jiayue was established in the PRC as a wholly-foreign owned enterprise with a registered capital of RMB10.0 million, which was wholly owned by Ronghui HK.

8. Capital injection to Ronghui Youjia and acquisition of Ronghui Youjia by Ronghui Jiayue

On 19 April 2021, the registered capital of Ronghui Youjia was increased from RMB10.0 million to RMB100.0 million through capital injection in the amount of RMB90.0 million by Ronghui Jiayue, which had been fully paid up as at the Latest Practicable Date. Upon completion of such capital injection, Ronghui Youjia became owned as to 90% by Ronghui Jiayue, 9.5% by Chongqing Ronghui Properties and 0.5% by Botu Consulting.

On 30 April 2021, Ronghui Jiayue acquired in aggregate 10% of the equity interest in Ronghui Youjia from Chongqing Ronghui Properties and Botu Consulting, at a total consideration of RMB9.6 million. Such consideration was determined after arm’s length negotiations having considered the valuation of Ronghui Youjia as at 10 April 2021, and had been fully settled on 23 June 2021. Upon completion of such acquisition, Ronghui Youjia became a direct wholly-owned subsidiary of Ronghui Jiayue.

RECENT ACQUISITION

Chongqing Xintianyuan was established in the PRC on 7 December 2007 as a limited liability company and is principally engaged in the provision of property management services. Prior to the acquisition of Chongqing Xintianyuan by our Group, it had three residential projects under its management which are located in Chongqing with a total GFA under management of approximately 851,248.9 sq.m. For the purpose of expanding our property management business, on 25 May 2021, Chongqing Ronghui PM acquired 49% and 2% equity interest in Chongqing Xintianyuan from each of Mr. Zhu Xiaopeng (朱小鵬) and Mr. Wang Yi (王藝), respectively, at a total consideration of RMB10.2 million. Each of Mr. Zhu Xiaopeng and Mr. Wang Yi is an Independent Third Party. The consideration was determined after arm’s length negotiation with reference to (i) the total ownership interest of Chongqing Xintianyuan as at 31 March 2021, (ii) the operations and profitability of Chongqing Xintianyuan and (iii) the value of the comparable companies. Upon completion of such equity transfer, Chongqing Xintianyuan became owned as to 51% by Chongqing Ronghui PM and 49% by Mr. Zhu Xiaopeng. As at the Latest Practicable Date, RMB5.0 million of the total consideration was settled in cash. The remaining consideration is expected to be fully settled by 2022 upon the fulfilment by Chongqing Xintianyuan of certain profit and GFA requirements.

Out of the GFA under management by Chongqing Xintianyuan, approximately 0.4 million sq.m. was in dispute as at the Latest Practicable Date. Please refer to the section headed “Business—Legal Proceedings and Compliance—Legal Proceedings—Xintianyuan Litigation” in this document for further information.

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DISPOSAL OF CERTAIN PRC COMPANIES

1. Disposal of Fuzhou Huixiang Information Technology Co., Ltd. (福州匯享信息技術有限公司) (“Fuzhou Huixiang”)

Fuzhou Huixiang was established in the PRC as a limited liability company on 15 October 2014. Prior to the disposal detailed below, it was held as to 20% by Fuzhou Ronghui and 80% by Mr. Pei Luyang. Fuzhou Huixiang was not engaged in any business prior to its disposal.

Taking into account that the expected future business of Fuzhou Huixiang would not be in line with our business development strategy and not related to the core business of our Group, on 20 January 2021, Fuzhou Ronghui transferred its 20% equity interest in Fuzhou Huixiang to Ms. Wong Fung Chun, the sister of Mr. Wong, at a consideration of RMB1, which was determined after arm’s length negotiation taking into account that none of the registered capital was paid as at the date of transfer. Such consideration had been fully settled as at the Latest Practicable Date. Upon completion of such transfer, Fuzhou Ronghui ceased to hold any equity interest in Fuzhou Huixiang.

2. Disposal of Wuhu Ronghui Property Management Co., Ltd. (蕪湖融匯物業管理有限公司) (“Wuhu Ronghui PM”)

Wuhu Ronghui PM was established in the PRC as a limited liability company on 22 September 2005. Prior to the disposal detailed below, it was wholly owned by Wuhu Ronghui Properties Co., Ltd. (蕪湖融匯置業有限公司)(“Wuhu Ronghui Properties”). Wuhu Ronghui Properties is owned as to 61% by Ronghui Fujian and 39% by a company controlled by Mr. Wong. Wuhu Ronghui PM was primarily engaged in property management business prior to its disposal.

Given Wuhu Ronghui PM only managed two projects with a total GFA of approximately 77,908.6 sq.m and contributing less than 2% of our total revenue for the year ended 31 December 2020, its size of operations is inconsistent with our scale of operations that we have built and maintained in other regions. In addition, with such small scale operation, it is difficult for Wuhu Ronghui PM to enjoy any cost optimization. In light of the above, on 9 February 2021, Wuhu Ronghui Properties transferred its entire equity interest in Wuhu Ronghui PM to Zheng Lidong, an Independent Third Party, at a consideration of RMB1, which was determined after arm’s length negotiation with reference to its net liability value as at 31 December 2020 and which had been fully settled as at the Latest Practicable Date. Upon completion of such transfer, Wuhu Ronghui Properties ceased to hold any equity interest in Wuhu Ronghui PM.

As confirmed by our Directors, each of Fuzhou Huixiang and Wuhu Ronghui PM had not been involved in any material non-compliance incidents or material legal, regulatory, arbitral or administrative proceedings, investigations or claims before its disposal.

As confirmed by our PRC Legal Advisors, the relevant SAIC procedures and steps involved in the aforesaid disposals had been properly and legally completed.

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PRC REGULATORY REQUIREMENTS

Our PRC Legal Advisors have confirmed that all applicable regulatory approvals in relation to the equity transfers and capital reduction in respect of the PRC companies in our Group in relation to the Reorganisation have been obtained, and the procedures involved have been carried out in accordance with applicable PRC laws and regulations.

CORPORATE STRUCTURE UPON COMPLETION OF THE REORGANISATION AND IMMEDIATELY PRIOR TO THE COMPLETION OF THE CAPITALISATION ISSUE AND THE [REDACTED]

The following diagram illustrates our shareholding structure upon completion of the Reorganisation and immediately prior to the completion of the Capitalisation Issue and the [REDACTED]:

Cheng Xi Mr. Wong Mr. Wong Ms. Chan Ms. Chan Chen Zhong

100% 55% 45% 100%

100% Wong-BVI 100% WC-BVI Chan-BVI (BVI) (BVI) (BVI) 100% 100% 100% Cheng-BVI Wong-Holding (BVI) (BVI) WC-Holding Chan-Holding CZ-BVI (BVI) (BVI) (BVI) [2.45]% [16.00]% [62.96]% [16.00]% [2.59]% 100% Our Company (Cayman Islands)

100%

Ronghui BVI (BVI)

100%

Ronghui HK (Hong Kong) offshore

100% onshore

Ronghui Jiayue (PRC)

100%

Ronghui Youjia (PRC)

100% 100%

Ronghui Guanling Chongqing Ronghui PM (PRC) (PRC)

100% 100% 100% 100% 100% 51% Ronghui Shandong Ronghui Fuzhou Ronghui Ronghui Cultural Fujian Ronghui PM CM LSB Chongqing Xintianyuan (Note 1) (PRC) (PRC) (PRC) (PRC) (PRC) (PRC)

50%

Funeng Ronghui (Note 2) (PRC)

Notes:

1. The remaining interest is held by Mr. Zhu Xiaopeng, an Independent Third Party (other than being a substantial shareholder of Chongqing Xintianyuan).

2. The remaining equity interest is held by Fujian Funeng Community Commercial Operation Management Co., Ltd. (福建福能社區商業管理有限公司), an Independent Third Party (other than being a substantial shareholder of Funeng Ronghui).

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INCREASE OF AUTHORISED SHARE CAPITAL

On [●] 2021, our Company increased its authorised share capital to HK$[1,000,000,000] by the creation of [962,000,000] additional Shares.

CAPITALISATION ISSUE

Pursuant to the written resolutions of our Shareholders passed on [●] 2021, conditional on the share premium account of our Company being credited as a result of the [REDACTED], our Directors are authorised to capitalise an amount of HK$[REDACTED] standing to the credit of the share premium account of our Company by applying such sum towards the paying up in full at par a total of [REDACTED] Shares for issue and allotment to holders of Shares whose names appear on the register of members of our Company on the date of passing such resolutions in proportion (as near as possible without involving fractions so that no fraction of a share shall be issued and allotted) to their then existing respective shareholdings in our Company.

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CORPORATE STRUCTURE UPON THE COMPLETION OF THE CAPITALISATION ISSUE AND THE [REDACTED]

The following chart sets forth our corporate and shareholding structure upon completion of the Capitalisation Issue and the [REDACTED] (assuming the [REDACTED] and any options which may be granted under the Share Option Scheme are not exercised):

Cheng Xi Mr. Wong Mr. Wong Ms. Chan Ms. Chan Chen Zhong

100% 55% 45% 100%

100% Wong-BVI 100% WC-BVI Chan-BVI (BVI) (BVI) (BVI) 100% 100% 100% Cheng-BVI Wong-Holding (BVI) (BVI) WC-Holding Chan-Holding CZ-BVI Public (BVI) (BVI) (BVI) Shareholders

[REDACTED]% [REDACTED]% [REDACTED]% [REDACTED]% [REDACTED]% [REDACTED]% 100% Our Company (Cayman Islands)

100%

Ronghui BVI (BVI)

100%

Ronghui HK (Hong Kong) offshore 100% onshore

Ronghui Jiayue (PRC)

100%

Ronghui Youjia (PRC)

100% 100%

Ronghui Guanling Chongqing Ronghui PM (PRC) (PRC)

100% 100% 100% 100% 100% 51% Ronghui Shandong Ronghui Fuzhou Ronghui Ronghui Cultural Fujian Ronghui PM CM LSB Chongqing Xintianyuan (Note 1) (PRC) (PRC) (PRC) (PRC) (PRC) (PRC) 50%

Funeng Ronghui (Note 2) (PRC)

Notes:

1. The remaining interest is held by Mr. Zhu Xiaopeng, an Independent Third Party (other than being a substantial shareholder of Chongqing Xintianyuan).

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SAFE REGISTRATION IN THE PRC

Pursuant to the Circular on Relevant Issues concerning Foreign Exchange Administration of Overseas Investment and Financing and Return Investments Conducted by Domestic Residents through Overseas Special Purpose Vehicles《關於境內居民通過特殊目的公司境外投融 ( 資及返程投資外匯管理有關問題的通知》) (the “Circular 37”), promulgated by SAFE and which became effective on 4 July 2014, a PRC resident (the “PRC Resident”) shall register with the local SAFE branch before he or she contributes the domestic assets or equity interests in an overseas special purpose vehicle, that is directly established or controlled by the PRC Resident for the purpose of conducting investment or financing.

Pursuant to Circular 13 promulgated by SAFE and came into effect on 1 June 2015, the local banks would review and carry out foreign exchange registration under overseas direct investment directly, and SAFE and its local branches shall implement individual supervision over foreign exchange registration of overseas direct investment via the banks.

As confirmed by our Directors, Mr. Chen Zhong, as a PRC resident, has completed the registration as required by Circular 37 and Circular 13 on 29 April 2021.

M&A RULES

On 8 August 2006, the Provisions on the Mergers and Acquisitions of Domestic Enterprises by Foreign Investors《關於外國投資者併購境內企業的規定》 ( ) (the “M&A Rules”) was jointly promulgated by six ministries and commissions, including MOFCOM, CSRC and SAFE, implemented on 8 September 2006 and amended on 22 June 2009 by MOFCOM.

According to Article 2 of the M&A Rules, “merger and acquisition of domestic enterprises by foreign investors” referred to in the M&A Rules shall mean that a foreign investor purchases the equity interest of a shareholder in a domestic non-foreign-invested enterprise (“domestic company”) or subscribes for increased capital of a domestic company so as to convert such domestic company into a foreign-invested enterprise; or, a foreign investor establishes a foreign-invested enterprise, through which it purchases and operates the assets of a domestic enterprise by agreement, or, a foreign investor purchases the assets of a domestic enterprise by agreement and then invests such assets to establish a foreign invested enterprise and operates the assets. According to Article 11 of the M&A Rules, the merger and acquisition of a domestic company with a related party relationship by a domestic company, enterprise or individual in the name of an overseas company legitimately incorporated or controlled by the domestic company, enterprise or individual shall be subject to examination and approval by MOFCOM. The parties involved shall not use domestic investment by foreign invested enterprises or other methods to circumvent the aforesaid requirements.

As advised by our PRC Legal Advisors, Article 11 of the M&A Rules is not applicable to our Reorganisation and we are not required to apply to the MOFCOM for approval of our Reorganisation because Mr. Wong and Ms. Chan are not domestic natural persons under the M&A Rules.

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OVERVIEW

We are a comprehensive provider of property management services and commercial operational services with over 15 years of operational experience. According to CIA, we ranked 55th among the 2020 Top 100 Property Management Companies and 50th among the 2021 Top 100 Property Management Companies in China in terms of overall strength. We have also been one of the Top 100 Property Management Companies in China for four consecutive years since 2018. We primarily focus on key cities in Chengdu-Chongqing Economic Zone, Bohai Rim Economic Zone and Western Taiwan Straits Economic Zone. We are also a large-scale integrated property management service provider in the Southwest Region that combines property management and commercial operation. According to CIA, among the 2020 Top 100 Property Management Companies in China, we also ranked 36th in terms of total GFA under management of large-scale integrated property in China, 10th in terms of total GFA under management of large-scale integrated property in the Southwest Region, and fourth in terms of total GFA under management of large-scale integrated property in Chongqing. We were awarded the “China Leading Property Management Companies in terms of Characteristic Service—Large-scale Integrated Property Operational Services” by CIA in both 2020 and 2021.

We provide diversified services through the following two business lines:

• property management services business line, which primarily includes (i) general property management services; (ii) value-added services to non-property owners; and (iii) community value-added services. As at 31 December 2020, we provided general property management services to 47 projects with a total GFA under management of approximately 6.4 million sq.m. As at the same date, we were contracted to provide general property management services to 57 projects with a total contracted GFA of approximately 8.3 million sq.m.; and

• commercial operational services business line, which primarily includes (i) commercial operational services to tenants; and (ii) commercial operational services to property developers and property owners. As at 31 December 2020, we provided commercial operational services to 13 projects with a total contracted GFA of approximately 0.3 million sq.m.

We have a long-term, strategic and cooperative relationship with Ronghui Group. We have been providing Ronghui Group with property management services since the establishment of our Group in 2006, and commercial operational services since 2008, respectively. Ronghui Group has over 17 years of property development experience and has comprehensive business offerings covering various industries, such as real estate, hotel management, construction engineering, landscape engineering and chemical industry. Ronghui Group was awarded Top 100 Leading Brand of China Comprehensive Real Estate Companies in 2018 and Top 100 China Real Estate Companies in 2019. As at 31 December 2020, Ronghui Group had 58 projects located in Chongqing, Jinan, Fuzhou and Wuhu, including (i) 46 projects which have been delivered (including five partially delivered projects) with a total delivered GFA of approximately 6.3 million sq.m., and (ii) 17 projects which have not been delivered (including five partially delivered projects) with a total undelivered GFA of 2.1 million sq.m., planned to be delivered by the end of 2023. During the Track Record Period, we were engaged to provide property management services and commercial operational services to substantially all of the

– 123 – 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 properties developed by Ronghui Group. We believe that Ronghui Group’s growth in real estate projects supply would continue to support the future growth of our property management services and commercial operational services.

We achieved significant growth during the Track Record Period. Our revenue increased from RMB198.9 million in 2018 to RMB224.2 million in 2019, and further to RMB241.4 million in 2020, representing a CAGR of 10.2% from 2018 to 2020. Our profit for the year increased from RMB18.5 million in 2018 to RMB35.6 million in 2019, and further to RMB54.2 million in 2020, representing a CAGR of 71.2% from 2018 to 2020.

The following table sets forth a breakdown of our total revenue by business line during the Track Record Period, both in absolute amount and as a percentage of total revenue during the years indicated:

For the year ended 31 December 2018 2019 2020 (RMB’000) (%) (RMB’000) (%) (RMB’000) (%)

Property management services ...... 164,792 82.8 186,785 83.3 203,279 84.2 Commercial operational services ...... 34,113 17.2 37,430 16.7 38,072 15.8

Total ...... 198,905 100.0 224,215 100.0 241,351 100.0

OUR STRENGTHS

Large-scale integrated property management service provider in the Southwest Region that combines property management and commercial operation

We are a large-scale integrated property management service provider in the Southwest Region that has 15 years of experience in providing property management services. We provide property management and commercial operational services in an integrated living ecosystem to the residents. As at 31 December 2020, we provide management services to three large-scale integrated properties with total GFA under management of 5.1 million sq.m., accounting for a majority of our total GFA under management. According to CIA, among the 2020 Top 100 Property Management Companies in China, we ranked 36th in terms of total GFA under management of large-scale integrated property, 10th in terms of total GFA under management of large-scale integrated property in the Southwest Region, and fourth in terms of total GFA under management of large-scale integrated property in Chongqing. We were awarded the “China Leading Property Management Companies in terms of Characteristic Service – Large-scale Integrated Property Operational Services” by CIA in both 2020 and 2021. We have also been one of the Top 100 Property Management Companies in China for four consecutive years since 2018. According to CIA, we ranked 55th among the 2020 Top 100 Property Management Companies and 50th among the 2021 Top 100 Property Management Companies in China in terms of overall strength. In 2019, we were awarded the China Enterprise Credit Rating Certificate (AAA) by the China Enterprise Evaluation Association.

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According to CIA, large-scale integrated property refers to a real estate project that contains residential properties and at least one type of non-residential properties with an aggregate GFA of more than 500,000 sq.m. that has integrated functions, such as residential and commercial consumption. Therefore, the large-scale integrated property is a concept in terms of both scale and property types.

We believe large-scale integrated properties can optimise our cost management and create synergy between our property management and commercial operational services. Our large-scale integrated properties provide larger GFA under management for a single project covering residential and non-residential properties which reduced the number of on-site personnel and project managers required per GFA under management. Large-scale integrated property gathers residents and commercial brands and creates a cluster effect, which allows us to achieve cost optimisation through centralised allocation of management resources between property management and commercial operation. In addition, with the support of our commercial operational services, the large-scale integrated properties that we manage offer a wide range of services such as retail, catering, parent-child activities and entertainment to our community and provide the residents with diversified, convenient and high quality community living experience, so as to increase their satisfaction and loyalty. Residents from the large scale integrated properties may also be the anchored customer base for our community value added services. On the other hand, the stable customer traffic from the residents of our large-scale integrated properties provide the incentive for tenants to establish their business at the commercial properties under our management, which will help increase the occupancy rate of the commercial properties of the large-scale integrated property and benefit the growth of our revenue.

In 2020, the management fee collection rate and retention rate under our general property management services was 94.5% and 100%, respectively. The customer satisfaction rate under our property management services in 2020 was 86.6%, which was 6.3% higher than the average level in the industry.

Proven track record to manage high quality commercial projects with distinctive features

Over the years, we have managed a number of high quality commercial projects with distinctive features, which are widely recognised by the market. The featured commercial projects managed by us cover a variety of theme features, such as catering, cultural tourism, urban business and neighbourhood centres. Through our precise positioning and strong tenant sourcing capability, commercial properties managed by us are widely recognised by the market. Below sets forth certain of our widely recognised featured commercial towns:

• Ronghui Xiliutuo Town (融匯西流沱小鎮). Ronghui Xiliutuo Town is positioned as Chongqing’s cultural and tourism new landmark and an integrated area for business, cultural, art and leisure activities. Leveraging its distinctive architecture design highlighting Chongqing cultural features and our commercial operational services with distinctive Chongqing features, Ronghui Xiliutuo Town has attracted multiple cultural and art brands that continuously provide fresh visual experience for visitors. We have also launched diversified cultural activities for Ronghui Xiliutuo Town, such as intangible cultural heritage performance, international cultural experience exchange week and pagoda light show. Ronghui Xiliutou Town

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was opened on 1 October 2018. As at 31 December 2020, Ronghui Xiliutou Town had a total contracted GFA of 29,096.9 sq.m. and an overall occupancy rate of 87.5%. Ronghui Xiliutuo Town was awarded Chongqing Cultural Tourism New Landmark Internet Popularity Award (重慶文旅新地標網絡人氣獎) in 2019 and was awarded Most Beautiful Cultural Tourism Town, Best Food Town, Most Livable Town and Internet Popularity Award in the Searching and Presenting Most Beautiful Featured Town in Sichuan and Chongqing Activity (川渝最美特色小鎮尋找與展示活動)in 2020.

• Ronghui In-spring Town (融匯泉裡小鎮). Ronghui In-spring Town is positioned as China’s leading hot spring leisure commercial cultural tourism town located in Chongqing. It incorporates design concepts from international designers. With the theme of hot spring tourism and urban entertaining designed by us, Ronghui In-spring Town creates a leisure business cluster with diversified types of operation combining featured catering, leisure entertainment, artworks as well as art and culture exhibition. Ronghui In-spring Town commenced its operation on 22 December 2013. As at 31 December 2020, Ronghui In-spring Town had a total contracted GFA of 28,468.6 sq.m. and had an overall occupancy rate of 76.1%. Ronghui In-spring Town, together with Ronghui Hot Spring and Ronghui boutique hotels, were awarded the National AAAA Tourist Area in the name of “Ronghui Hot Spring Town” in 2017 and the Chongqing Cultural and Tourism New Landmark in 2019.

• Ronghui Jinan Old Commercial Port (融匯濟南老商埠). Ronghui Jinan Old Commercial Port is located in the core area of Jinan’s commercial port and landscape zone. With the development concept of “revival and transcendence” designed by us, Ronghui Jinan Old Commercial Port aims to revive the historical features and prosperity hundreds years ago with a combination of modern ways of life. It covers cultural, tourism and commercial properties and integrates the city memories, cultural relics, traditional life scenes and commercial space, which makes Ronghui Jinan Old Commercial Port a thriving traditional street with cultural heritage, tourism and commercial functions. Ronghui Jinan Old Commercial Port was opened on 29 June 2017. As at 31 December 2020, Ronghui Jinan Old Commercial Port had a total contracted GFA of 41,172.0 sq.m. and an overall occupancy rate of 88.5%.

We were involved with the Ronghui Group, as the developer, in the early stage with the design and development of these featured commercial projects. We participated in project meetings with the property developer, provided market research and positioning services and adviced on design and layout planning, business positioning and rental strategy.

The successful operation of our featured commercial projects have enabled us to earn a market reputation in the management of commercial projects with distinctive features, paving the way for us to obtain similar projects in the future and distinguish ourselves from our competitors.

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Use of property management information system and commercial operational information system to improve operational efficiency and user experience

We are committed to provide quality services and believe that technology can drive operational efficiency and improve user experience of our customers. We have a property management information system and a commercial operational information system to improve our operational efficiency and user experience of our customers.

Property Management Information System

Our property management information system primarily consists of two intelligent platforms.

(i) Intelligent Property Management Platform. Intelligent property management platform is the core platform of our property management information system. It integrates nine modules covering basic property information, general customer services, security patrolling, equipment and facilities patrolling, income management, quality control, inventory management, system management and financial reporting. We have a mobile application based on our intelligent property management platform for our staff, which integrates the functions such as customer reporting, task allocation, security patrolling, equipment and facilities patrolling and quality control. It allows our staff to have access to our core intelligent property management functions on-site, which significantly increases their efficiency. Based on our intelligent property management platform, we have also implemented an intelligent community facilities management system, which connects certain of our property management facilities and equipment with our intelligent property management platform, which provides intelligent functions such as intelligent car park management, intelligent entrance management and equipment and facilities online monitoring.

(ii) Xiaohui Dangjia (小匯當家) Smart Community Service Platform. We have implemented a customer-oriented smart community service platform leveraging Internet-of-Things (IoT) technologies, which we believe has enhanced our capabilities to improve customer experience, reduced reliance on manual labour and lowered operating costs. On 30 September 2019, we launched our Xiaohui Dangjia (小匯當家) App and completed its WeChat mini mobile application in 2020, which provides access through mobile application, WeChat official account and WeChat mini mobile application. The services we provide through our Xiaohui Dangjia smart community service platform primarily include online property management fee payment, repair and maintenance request, customer service hotline, remote door opening, visitor access, housekeeping services booking, customised travel plan booking and online supermarket. Through our Xiaohui Dangjia smart community service platform, we are able to gain better knowledge of our property owners’ and residents’ needs and enhance their satisfaction and loyalty to us.

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Commercial Operational Information System

We have an internal commercial operational management platform that enables the recording of data collected from our services, covering tenant sourcing, agreement signing, merchant entry, merchant operations and financial settlement. It establishes a commercial database and combines the commercial data from services we provide to formulate standardised commercial operational procedures. By fully utilising the commercial operational management platform, we are able to increase average GFA under management per staff, reduce staff costs and offline communication costs, enhance the accuracy and time-effectiveness of data as well as improve the efficiency of our management in decision making, thus achieving more cost-efficient commercial operational services.

Growth opportunities derived from the long-term, strategic and cooperative relationship with Ronghui Group

We have a long-term, strategic and cooperative relationship with Ronghui Group and we can benefit from the growth of real estate business of Ronghui Group. Ronghui Group has over 17 years of property development experience and has comprehensive business offerings covering various industries, such as real estate, hotel management, construction engineering, landscape engineering and chemical industry. Ronghui Group was awarded Top 100 Leading Brand of China Comprehensive Real Estate Companies in 2018 and Top 100 China Real Estate Companies in 2019. As at 31 December 2020, Ronghui Group had 58 projects located in Chongqing, Jinan, Fuzhou and Wuhu, including (i) 46 projects which have been delivered (including five partially delivered projects) with a total delivered GFA of approximately 6.3 million sq.m.; and (ii) 17 projects which have not been delivered (including five partially delivered projects) with a total undelivered GFA of 2.1 million sq.m. planned to be delivered by the end of 2023. Supported by Ronghui Group’s growth in real estate projects supply, the projects under our management of our general property management services increased from 43 in 2018 to 47 in 2020. The total GFA under our management of our general property management services also increased from 5.7 million sq.m. in 2018 to 6.4 million sq.m. in 2020.

As at 31 December 2020, 98% of the projects developed by Ronghui Group and/or its associates and joint ventures were managed by us. We believe that Ronghui Group and/or its associates and joint ventures diversified project portfolio will continue to grow, helping future growth of our business.

In addition to the projects developed by Ronghui Group and/or it associates and joint ventures, we have built a business development team with strong execution capabilities in sourcing projects developed by Independent Third Parties. In 2019, we provided property management services to a factory of a well-known cleaning products manufacturer with a total GFA under management of 98,423.0 sq.m. In 2020, we provided property management services to several non-residential properties developed by Independent Third Party developers with a total GFA under management of 118,423.0 sq.m. Leveraging our service experience for featured commercial towns, we entered into an agreement in 2020 for the provision of property management services to Mountain City Lane (山城巷) in Chongqing. Mountain City Lane was recognised as one of the 28 traditional style areas in Chongqing by Chongqing Planning Bureau. We have also entered into a tenant sourcing contract in April 2021 with an Independent Third Party real estate developer for a commercial project in Chongqing with a total GFA available for tenant sourcing of approximately 25,756.9 sq.m.

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Professional and devoted management team supported by well-established talent development system

Our senior management team, with an average of more than 16 years of experience in the property management industry, has extensive management experience, profound industry understanding and outstanding management capabilities. Ms. Wong Tan Ching, our executive Director and chairperson, has over 12 years of experience in real estate and property management industries. She has held positions in our Group and Ronghui Group since August 2008. Mr. Wong Wai Lam, our executive Director and executive president, with over 11 years of experience in real estate and property management industries, held positions in our Group since December 2010 and the Chongqing Ronghui Properties from July 2009 to February 2021. He was also named as one of the “2016 Top 10 Annual Innovative Figure for Chongqing Economy” (2016 十大重慶經濟年度創新人物) in 2017.

Mr. Zhuo Min, general manager for property business department of Chongqing Ronghui PN, has over 21 years of experience in property management and property development industries. He was also named as one of the “2019 Top 100 China Property Manager” (2019中國物業經理人100強) by CIA in 2019. Ms. Jiang Hong, general manager for commercial business department of Ronghui Guanling, has over 22 years of experience in commercial operation management. She was named as one of the “Commercial Property Asian Cup-Excellent Figure of Commercial Property” (商業地產亞洲杯—商業地產傑出人物) and the “Commercial Property Golden Coordinate Award-Annual Pioneer of Commercial Property” (商業地產金坐標獎—年度商業地產先鋒人物) by Yingshang website (贏商網) in 2019 and 2020, respectively. Please refer to the section headed “Directors and Senior Management” in this document for further details of the background and experience of our management team. We believe that our management team will continue to guide us in expanding our business and executing our strategies.

Guided by our talents development principle of “exploring talents from the Internet, developing talents through training and retaining talents through encouragement”, we have established a comprehensive cadre training policy. Based on the skills and talents of our employees, we identify, develop and cultivate suitable reserve talents by establishing an effective key post successor and reserve talent pool, so as to ensure the continuous supply of talents.

In order to support the training and development of our employees, we have established the “Hui College” (匯學堂) with three training bases in Chongqing, Shandong, and Fujian. As at 31 December 2020, we had over 40 senior internal trainers. After years of accumulation, we have developed 67 standardised training courses, such as customer communication skills, safety management and smart platform management. In order to fully cover the growth needs of employees at all levels of our Group, we have established a new employee induction guidance for our employees and organised various featured professional training camps for our management, which provide promotion path for our employees and ensure the continuous supply of talents.

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OUR STRATEGIES

Reinforce our market position in key regions and further develop our business through enlarging our business scale, expanding in regions with strong growth potential and further optimising our project portfolio

We will continue to leverage our long-term, strategic and cooperative relationship with Ronghui Group. We plan to maintain the high tender success rate for properties developed by Ronghui Group primarily through improving our service capabilities in relation to a wide variety of property types and enhancing our mutual understanding with Ronghui Group based on our long-standing cooperative relationship and proven track record.

We will focus on key cities in Chengdu-Chongqing Economic Zone, Bohai Rim Economic Zone and Western Taiwan Straits Economic Zone, such as Chongqing, Jinan, Fuzhou and other provincial capital cities in these regions. We plan to further expand our business to other major cities in Sichuan, Guizhou, Fujian, Gansu and Shandong provinces. These cities are close to the areas we currently operate and we believe we can better utilise our existing resources and experience in exploring the business opportunities in these cities. In addition to our expansion through strategic acquisition, investment and cooperation with other major developers, we will continue to actively collect and select bidding and tendering opportunities. Through our professional business development team, we will evaluate extensive potential target projects and prepare tendering plans based on our internal risk and profitability requirements.

We plan to further improve our business development team by setting up investment and business development centre at group level and market investment and development departments in our regional companies, composed of members with professional experience in property market development. Our business development team will be in charge of market channels exploration, target project information collection and selection, business communication, project calculation and evaluation, bidding materials preparation, bidding-related procedures management and internal approval and signing of Independent Third Party contracts. We may also establish new subsidiaries or set up new branches in the target regions to undertake new projects for business development. We provide attractive incentive to our employees for valid market intelligence and successful Independent Third Party projects. We offer a fixed amount award for the business development team or individual for each project introduced to and approved by the Group. We also provide a percentage of the amount receivable for the first year as incentive if we successfully enter into agreement for such project. We plan to further explore opportunities in managing properties developed by Independent Third Party developers through our diversified market information channels, including governmental bidding and procurement websites, local property owners associations, local industry associations, suppliers and Independent Third Party developers which have existing business relationship with us.

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Further expand our business operations through strategic acquisitions and investments

Leveraging our proven track record and extensive experience in the industry, we plan to further expand and diversify our business through strategic acquisitions and investments. We plan to prioritise potential investment or acquisition targets with business in the core cities in Chengdu-Chongqing Economic Zone, Bohai Rim Economic Zone and Western Taiwan Strait Economic Zone or with diversified property portfolio such as residential properties, commercial properties, cultural and tourism properties, industrial parks, schools, hospitals and public properties. Through investment and acquisition of these potential targets, we expect to expand our geographical coverage, strengthen our competitiveness in these regions, diversify our property portfolio and promote our brand awareness.

Our existing management projects are located in Chongqing, Jinan, and Fuzhou. Through years of efforts, our services have gained good reputation and market recognition in these regions. We believe potential investment and acquisition targets with business in Chengdu-Chongqing Economic Zone, Bohai Rim Economic Zone and Western Taiwan Strait Economic Zone can help us to continue to expand in these regions, enter into the markets of surrounding cities and create regional scale effect to improve our management efficiency. In addition, according to CIA, these regions are considered as the key economic development zones of China, with high economic growth. The real estate development market in these regions continues to develop and there is a sizable housing market, which creates greater demand for property management services.

For our property management services, we plan to selectively evaluate potential target companies with business in Chengdu-Chongqing Economic Zone, Bohai Rim Economic Zone and Western Taiwan Strait Economic Zone, primarily taking into account certain evaluation criteria, including but not limited to:

• companies that have an aggregated GFA under management of over 800,000 sq.m. or annual net profit margin of over 8.0% in the latest financial year; or

• companies with diversity in the portfolio of managed properties such as residential properties, commercial properties, cultural and tourism properties, industrial parks, schools, hospitals and public properties.

For our commercial operational services, we plan to selectively evaluate potential target companies that have business focus in Chongqing, Jinan or Fuzhou, primarily taking into account certain evaluation criteria, including but not limited to:

• companies that have an aggregated contracted GFA of 50,000 sq.m. or above or annual net profit margin of 15.0% or above in the latest financial year; or

• companies that manage diversified commercial property portfolio such as shopping malls or shopping streets or companies that manage commercial projects which have high growth potential.

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We also plan to strategically acquire or invest companies that can create synergy effect with our community value-added services and smart management system. Strategic acquisitions and investments in these companies with synergies enable us to save the time and cost required to develop our downstream businesses. Through these acquisitions and investments, we can expand our business scope to cover the entire property management and value-added services value chain, so that we can provide comprehensive services to meet customer needs, improve customer satisfaction and improve our market reputation. We plan to selectively evaluate potential target companies in this regard, primarily taking into account certain evaluation criteria, including but not limited to:

• companies that have business focus on community value-added services and smart management platform, such as smart community, health and elderly care, catering and housekeeping; or

• companies that have stable customer base and cash flow; or

• companies that have well-developed management system.

We believe that we will be able to further diversify our services, broaden our geographical coverage, and enhance our market position through strategic acquisitions and investments.

We plan to use [REDACTED]% of the [REDACTED]fromthe[REDACTED]in acquisition and strategic investments. As at the Latest Practicable Date, we had not identified any potential investment acquisition target or entered into any definite investment or acquisition agreement. In addition to the aforementioned criteria, in evaluating potential investment or acquisition targets, we are also inclined to invest in those that possess a competent management team, proven track record, and good reputation in the industry with good compliance record.

Please refer to the section headed “Future Plans and [REDACTED]” in this document for further information.

Improve our service quality and operational efficiency through upgrades and optimisation of our information management systems and platforms

We plan to upgrade our property management information system mainly through the following methods:

(i) Upgrading our Intelligent Property Management Platform. We plan to establish our own server, on which we can store the system and data of our intelligent property management platform. In addition, we also plan to enhance the key functions of our intelligent property management platform primarily by developing new functions such as statistics report management, system function optimisation, third-party system integration and staff portal customisation;

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(ii) Upgrading our Intelligent Community Facilities Management System and IoT Hardware. We plan to upgrade our intelligent community facilities management system and IoT hardware through the following measures:

• upgrading our security system, which can integrate our online intelligent facilities monitoring system to monitor the entrances and exits, the operation of our security system and the working conditions of our employees. It can also integrate facial recognition systems at main entrances and exits of the properties we manage to improve safety and management efficiency; and

(iii) Upgrading Xiaohui Dangjia Smart Community Service Platform. We plan to upgrade and optimise the user experience of the existing functions of the Xiaohui Dangjia Smart Community Service Platform, primarily through:

• optimising online payment experience of property management fee and including additional online payment options;

• integrating the purchase, sales and storage functions, such as inventory counting, real-time records of product circulation, and data report statistics. It can provide comprehensive control of daily inventory and other tasks, keeping up-to-date inventory information at any time and effectively avoid inventory backlog or shortage.

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We plan to upgrade our commercial operational information system mainly in the following methods:

(i) Upgrading our Commercial Operational Management Platform. We plan to upgrade our commercial operational management platform mainly through the following methods:

• optimising the information exchange between the commercial membership platform and the merchant operating platform, which can perform member data analysis based on the data collected from the commercial membership platform;

• upgrading the marketing and promotion functions of the membership system to allow registered members to obtain various gift cards and coupons provided by merchants through the membership system. Customers can also receive the latest business updates such as promotional activities and commercial promotion announcements according to their own preferences; and

• increasing the service functions of merchants and members, such as bill reminders, online payment, live sales, maintenance, event participation, gift card and coupon verification, and bill statistics.

(ii) Establishing the Commercial Customer Flow Statistics System. We plan to establish a commercial customer flow statistic system, which can monitor commercial passenger flow in real time, collect ambient data and monitor the commercial areas we manage. It can be connected to our commercial operational management platform to establish the monitoring of important business data of our business operation services, so as to improve our ability to analyse business data and improve the performance of our business operation services; and

(iii) Establishing the Grand Membership System. We plan to establish a grand membership system which can connect our property management information system and commercial operational information system and share membership benefits across these systems, so as to create additional commercial value through multi-business cooperation.

We plan to upgrade our internal management system and core data management platform, mainly through upgrading our video conferencing system, file management system, office automation system, human resource system, financial management system and other management systems by purchasing third-party hardware and software, so as to reduce human errors and provide our management with the latest operating performance through data analysis and improve the efficiency of business management.

We plan to use [REDACTED]% of the [REDACTED]fromthe[REDACTED] in upgrading our smart management system. Please refer to the section headed “Future Plans and [REDACTED]” in this document for further information.

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Develop other diversified value-added services to improve our value-added services penetration rate and continue to upgrade our existing value-added services

We believe the key to our success is the delivery of satisfying customer experience. We intend to develop new value-added services and continue improving customer experience through further diversifying and enhancing the value-added services we provide.

We plan to develop other value-added services based on our residents’ need and the orientation of policies, primarily through:

• Health and elderly care. We plan to identify appropriate venues in or around our community and set up health and elderly care centres. We also plan to provide home elderly care services that combine medical care and elderly care. A majority of the projects managed by us are large-scale integrated properties and the project area is highly concentrated, which creates greater customer needs for the establishment of a health care centre in the community. We believe that the health care industry has a good development prospect and a wide range of social needs, which can provide long-term benefits while improving the convenience and satisfaction of residents in our community.

• Community catering. We plan to identify appropriate venues in or around the community and set up community restaurants to provide healthy meals for property owners, residents and other customers. We believe that there is continuous demand for the catering industry.

• Marketing and private activities. We plan to provide marketing services for our commercial customers and customised private activities (such as banquets and birthday party for our residents) to meet the needs of our residential customers for better quality of living experience.

We also plan to upgrade our existing value-added services, primarily through:

• “Good Choice” group buying. We provide group buying services to our residents, which include food, daily necessities and education services. We plan to leverage the scale effect of the properties we manage to obtain more competitive prices and provide our residents with diversified products with high quality. We also plan to open offline community stores for convenient group buying. We plan to purchase the required equipment to expand the supply chain for more categories of products and promote our group buying services through various marketing activities.

• Community tailor-made services. We provide repair services as well as housekeeping services to meet the daily needs of our residents. We plan to increase the purchase of professional facilities and equipment and expand our professional team to improve our service capacity and quality for engineering and repair services and housekeeping services.

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• Sales assistance. Our sales assistance services primarily include parking space sales services and housing rental services. We plan to expand the scope of our sales assistance services, recruit more professionals with relevant experience, establish an asset management information management platform and more effectively manage housing brokerage information and internal processes, so as to optimise customer experience.

We plan to use [REDACTED]% of the [REDACTED]fromthe[REDACTED] in upgrading our existing value-added services and developing new value-added services. Please refer to the section headed “Future Plans and [REDACTED]” in this document for further information.

Enhance our brand image and reputation through marketing initiatives and strategic cooperation with other developers and famous brands

We plan to enhance our brand image through various marketing initiatives and strategic cooperation with other developers and famous brands. We believe that such marketing efforts will help us build greater customer recognition, enhance brand awareness, and improve our brand image which may, in turn, foster stronger customer loyalty to our brand.

We plan to cooperate with other real estate developers, branded merchants and other cultural tourism brands to improve our brand awareness and image. Through strengthening our marketing and promotion efforts of operating private media channels and WeChat official account as well as participating in property management related summits, exchanges and conferences, we aim to improve our brand image and increase brand awareness. We also plan to strategically cooperate with other well-known brands in non-real estate industries to improve our customers’ overall household experience from the perspective of innovative and differentiated services. For example, we plan to (i) cooperate with well-known takeaway food suppliers for community supply; (ii) cooperate with well-known brand merchants in neighbouring communities to enjoy unique discounts; and (iii) cooperate with other cultural tourism attractions to promote synergy between our residential and cultural tourism projects.

Attract, retain and motivate talents through systematic training programmes and solid career development opportunities

We are committed to building a strong team, comprised of members who have strong execution capabilities and rich experience in property management services and/or commercial operational services, and who share our vision and corporate values. We believe that our future success and growth depend largely on our ability to attract and retain talents. We will continue to optimise our talent pool by attracting employees with rich industry experience and management skills, particularly those with specialised skills of management in relevant service areas that we aim to enter into. We plan to provide an attractive incentive mechanism to retain talents. We will also provide our employees with systematic training programmes and constructive career development opportunities, which also allows us to identify employees we deem to have the potential to grow into key members of our team. Through the various training programmes we offer, we aim to cultivate and retain key employees and support their ongoing career development.

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OUR BUSINESS MODEL

We primarily generate revenue from two business lines: (i) property management services; and (ii) commercial operational services.

Property Management Services

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Commercial Operational Services

(i) Commercial operational services to tenants. We provide business management services to tenants during the operational stage of the commercial properties, which primarily include:

(a) Tenant coaching — We strive to help tenants achieve better business performance through providing assistance to monitor and analyse their business data and provide training and advice to tenants’ staff on store display, building strong consumer relations and advising tenants on store layout and interior design and providing suggestions for improving tenants’ overall services quality;

(b) Marketing and promotion services — We hold various promotional activities including holiday sales, public relation and promotion events, aiming to attract traffic to our commercial properties and increase tenants’ sales; and

(c) Subleasing services – We sublease certain commercial properties that we lease from the property developers to the tenants. We also provide general property management services for the subleased properties.

(a) market research and positioning services during the preparatory stage, including market research and analysis, functional layout planning, business positioning and rental strategy, professional engineering advisory and business design advisory;

(b) tenant sourcing services during the preparatory stage, including helping property owners to identify and solicit target tenants, arrange the signing of tenancy agreements and manage the tenants; and

(c) pre-opening preparatory services during the preparatory stage for the launch of new commercial projects, including supervising the design and construction works, managing the entry of tenants, formulating resources allocation plans, conducting on-side supervision and coordination works, advertising and promotion, public relations and other administrative services.

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For the year ended 31 December 2018 2019 2020 (RMB’000) (%) (RMB’000) (%) (RMB’000) (%)

Property management services ...... 164,792 82.8 186,785 83.3 203,279 84.2 Commercial operational services ...... 34,113 17.2 37,430 16.7 38,072 15.8

Total ...... 198,905 100.0 224,215 100.0 241,351 100.0

PROPERTY MANAGEMENT SERVICES

Overview

We provide a variety of property management services to non-property owners (primarily property developers), property owners and residents. As at 31 December 2020, we had a total of 47 projects under management and 57 contracted projects for our property management services business line in Chongqing, Fuzhou, Fujian Province, Jinan, Shandong Province and Wuhu, Anhui Province. As at 31 December 2018, 2019 and 2020, our total GFA under management under the general property management services segment was approximately 5.7 million sq.m., 6.0 million sq.m. and 6.4 million sq.m., respectively. Our revenue from property management services reached RMB164.8 million, RMB186.8 million and RMB203.3 million in 2018, 2019 and 2020, respectively, accounting for 82.8%, 83.3% and 84.2% of our total revenue for the same periods, respectively. In 2018, 2019 and 2020, revenue generated from general property management services for projects developed by Ronghui Group and/or its associates and joint ventures amounted to approximately RMB124.8 million, RMB140.7 million and RMB147.8 million, respectively, accounting for 99.5%, 99.5% and 99.6% of our total revenue generated from general property management services for the same periods.

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The table below sets forth a breakdown of our total revenue from property management services by service category, both in absolute amount and as a percentage of total revenue from property management services, for the years indicated.

For the year ended 31 December 2018 2019 2020 (RMB’000) (%) (RMB’000) (%) (RMB’000) (%)

General property management services . . 125,361 76.1 141,485 75.7 148,442 73.0 Value-added services to non-property owners . . 22,967 13.9 26,521 14.2 28,313 13.9 Community value-added services ...... 16,464 10.0 18,779 10.1 26,524 13.1

Total ...... 164,792 100.0 186,785 100.0 203,279 100.0

The table below sets forth the breakdown of our revenue generated from property management services by geographic region for the years indicated.

For the year ended 31 December 2018 2019 2020 RMB’000 % RMB’000 % RMB’000 %

Chongqing ...... 113,186 68.7 130,858 70.1 146,895 72.3 Fuzhou, Fujian Province 23,620 14.3 23,221 12.4 24,545 12.1 Jinan, Shandong Province ...... 24,228 14.7 28,693 15.4 28,074 13.8 Wuhu, Anhui Province . 3,758 2.3 4,013 2.1 3,765 1.8 Total ...... 164,792 100 186,785 100 203,279 100

General Property Management Services

In 2018, 2019, 2020, our revenue generated from general property management services amounted to RMB125.4 million, RMB141.5 million and RMB148.4 million, respectively, representing 76.1%, 75.7% and 73.0% of our total property management service revenue for the same periods, respectively.

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Our Geographic Presence As at 31 December 2020. we had a total of 47 projects under management and 57 contracted projects under the general property management services segment in Chongqing, Fuzhou, Fujian Province, Jinan, Shandong Province and Wuhu, Anhui Province. The map below illustrates the locations of projects we managed and were contracted to manage as at 31 December 2020.

Jinan, Shandong Number of projects under management: 7

Wuhu, Anhui (Note) Number of projects under management: 2

Fuzhou, Fujian Number of projects under management: 9

Chongqing Number of projects under management: 29

Note: In February 2021, we disposed Wuhu Ronghui PM to an Independent Third Party and we ceased to provide property management services to projects located in Wuhu. The following table 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 at the dates indicated. As at 31 December 2018 2019 2020

Number of projects under management(1) ...... 43 43 47 Number of projects we were contracted to manage(2) ...... 48 53 57 GFA under management (sq.m. in thousands) ...... 5,726.6 6,022.7 6,355.7 Contracted GFA (sq.m. in thousands) .... 7,490.5 7,902.3 8,298.6

Notes: (1) Refers to projects that have been delivered to us for property management purposes. (2) Refers to all projects for which we have entered into the relevant property management service agreements, which may include projects that have not been delivered to us for property management purposes in addition to projects under management.

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

As at/for the year ended 31 December 2018 2019 2020

Number Number Number of GFA under of GFA under of GFA under projects management Revenue projects management Revenue projects management Revenue (‘000 (RMB’ (‘000 (RMB’ (‘000 (RMB’ sq.m.) (%) 000) (%) sq.m.) (%) 000) (%) sq.m.) (%) 000) (%)

Chongqing .... 25 4,092.7 71.5 92,721 74.0 26 4,431.9 73.6 105,715 74.7 29 4,689.5 73.8 111,166 74.9 Fuzhou, Fujian Province.... 9 717.4 12.5 14,832 11.8 8 674.3 11.2 14,661 10.4 9 749.7 11.8 16,644 11.2 Jinan, Shandong Province.... 7 838.6 14.6 16,516 13.2 7 838.6 13.9 19,814 14.0 7 838.6 13.2 19,335 13.0 Wuhu, Anhui Province BUSINESS 4 – 142 –

(Note) 2 77.9 1.4 1,292 1.0 2 77.9 1.3 1,295 0.9 2 77.9 1.2 1,297 0.9

Total...... 43 5,726.6 100.0 125,361 100.0 43 6,022.7 100.0 141,485 100.0 47 6,355.7 100.0 148,442 100.0

Note: In February 2021, we disposed of Wuhu Ronghui PM to an Independent Third Party and we ceased to provide property management services to projects located in Wuhu. We provide general property management services to a diversified portfolio of projects, including (i) residential properties and (ii) DOCUMENT. THIS BE OF MUST COVER INFORMATION THE THE ON THAT “WARNING” AND HEADED CHANGE SECTION TO THE SUBJECT WITH AND CONJUNCTION INCOMPLETE IN FORM, READ DRAFT IN IS DOCUMENT THIS non-residential properties primarily including (a) commercial properties, such as shopping streets, office buildings, and (b) public and industrial properties, such as industrial parks, schools and factories. The following table sets forth a breakdown of our number of projects and total GFA under management by property type as at the dates indicated, and revenue from general property management services by property type for the years indicated, both in absolute amount and as a percentage of total GFA under management/revenue from general property management services.

As at/for the year ended 31 December 2018 2019 2020 Number Number Number of GFA under of GFA under of GFA under projects management Revenue projects management Revenue projects management Revenue (‘000 (‘000 (‘000 sq.m.) (%) (RMB’000) (%) sq.m.) (%) (RMB’000) (%) sq.m.) (%) (RMB’000) (%)

Residential properties . . . 34 5,254.1 91.7 101,383 80.9 33 5,451.8 90.5 114,712 81.1 35 5,689.4 89.5 122,121 82.3 Non-residential properties . . . – Commercial BUSINESS properties . 9 472.5 8.3 23,978 19.1 9 472.5 7.9 26,381 18.6 11 567.9 8.9 25,721 17.3 – Public and – 143 – industrial properties . –––––198.4 1.6 392 0.3 1 98.4 1.6 600 0.4

Non-residential properties sub-total .... 9 472.5 8.3 23,978 19.1 10 570.9 9.5 26,773 18.9 12 666.3 10.5 26,321 17.7

Total...... 43 5,726.6 100.0 125,361 100.0 43 6,022.7 100.0 141,485 100.0 47 6,355.7 100.0 148,442 100.0 Portfolio of Properties under Management or Contracted Properties DOCUMENT. THIS BE OF MUST COVER INFORMATION THE THE ON THAT “WARNING” AND HEADED CHANGE SECTION TO THE SUBJECT WITH AND CONJUNCTION INCOMPLETE IN FORM, READ DRAFT IN IS DOCUMENT THIS

We primarily offer general property management services to properties developed by Ronghui Group or joint ventures and associates of Ronghui Group. The following table sets forth a breakdown of our number of projects under management, total GFA under management and total GFA of contracted GFA by developer type as at the dates indicated, as well as revenue from general property management services by developer type for the years indicated, both in absolute amount and as a percentage of total GFA under management/revenue from general property management services.

As at/for the year ended 31 December 2018 2019 2020 Number Number Number of GFA under of GFA under of GFA under projects management Contracted GFA Revenue projects management Contracted GFA Revenue projects management Contracted GFA Revenue (‘000 (‘000 (‘000 (‘000 (‘000 (‘000 sq.m.) (%) sq.m.) (%) (RMB’000) (%) sq.m.) (%) sq.m.) (%) (RMB’000) (%) sq.m.) (%) sq.m.) (%) (RMB’000) (%)

Ronghui Group BUSINESS

4 – 144 – (1) ..... 38 5,233.2 91.4 6,997.1 93.4 116,533 93.0 38 5,474.0 90.9 7,353.6 93.1 132,039 93.3 40 5,711.6 89.9 7,441.0 89.7 136,821 92.2 Joint ventures and associates of Ronghui Group

(2) . 4 450.3 7.9 450.3 6.0 8,231 6.5 4 450.3 7.5 450.3 5.7 8,709 6.2 5 525.7 8.3 739.2 8.9 11,021 7.4 Independent third-party property developers

(3) . . . 1 43.1 0.7 43.1 0.6 597 0.5 1 98.4 1.6 98.4 1.2 737 0.5 2 118.4 1.8 118.4 1.4 600 0.4

Total ...... 43 5,726.6 100.0 7,490.5 100.0 125,361 100.0 43 6,022.7 100.0 7,902.3 100.0 141,485 100.0 47 6,355.7 100.0 8,298.6 100.0 148,442 100.0

Notes:

(1) Refers to properties solely developed by Ronghui Group or jointly developed by Ronghui Group and independent third-party property developers in which Ronghui Group held a controlling interest.

(2) Refers to properties jointly developed by Ronghui Group and independent third-party property developers in which Ronghui Group did not hold a controlling interest.

(3) Refers to properties developed solely by independent third-party property developers. 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

For our property management services, our total GFA under management for projects solely developed by independent third party developers grew from 43,092.5 sq.m. as at 31 December 2018 to 118,423.0 sq.m. as at 31 December 2020. Revenue generated from managing projects solely developed by Independent Third Party property developers remain stable from 2018 to 2020, primarily due to the fact that we ceased to provide property management services to a residential property developed by Independent Third-Party developer in 2019 due to our management fee proposal for providing the required standard of services was not accepted by the relevant property owners’ association and began to provide property management services to industrial parks in 2019 which have relatively lower property management fees per sq.m. We also had five projects under management developed by a joint venture of Ronghui Group with an aggregate GFA of 525,717.3 sq.m. as at 31 December 2020, and with an aggregate revenue of RMB17.8 million in 2020.

Property Management Services Provided by our Joint Venture Company

During the Track Record Period, we also provided property management services through Funeng Ronghui, our joint venture company. The following table sets forth the number of properties and GFA managed by Funeng Ronghui, as well as the number of properties Funeng Ronghui contracted to manage and corresponding contracted GFA as at the dates indicated.

As at 31 December 2018 2019 2020

Number of properties under management .... 18 34 33 Number of properties we were contracted 18 34 33 to manage ...... GFA under management (sq.m. in thousands) . 451.6 746.6 918.5 Contracted GFA (sq.m. in thousands) ...... 451.6 746.6 918.5

The properties managed by Funeng Ronghui are sourced from our joint venture partner of Funeng Ronghui, which is an Independent Third Party. During the Track Record Period, the biddings participated by Funeng Ronghui was five, the bidding successful rate of Funeng Ronghui was approximately 80%. The average property management fee per sq.m. of the properties managed by Funeng Ronghui was RMB1.19, RMB1.42 and RMB1.35 in 2018, 2019 and 2020, respectively.

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We provide a series of general property management services to non-property owners (primarily property developers), property owners, residents which primarily include the following:

Customer Services

We provide routine customer services to the properties we manage, which primarily include reception desk and 24-hour customer hotline for inquiry response, feedback collection and repair request coordination. We provide customer services through our own employees.

Cleaning Services

We provide cleaning services for the common areas and public facilities of the properties we manage, which primarily include general cleaning, garbage disposal, pest control, exterior wall cleaning, stone material maintenance and drainage cleaning services. We provide cleaning services mainly through Independent Third Party subcontractors.

Security Services

We provide routine security services to ensure the safety and order of the properties we manage, which primarily include visitor management, private car park management, fire safety management, patrolling, surveillance and emergency response. We provide security services mainly through our own employees and Independent Third Party subcontractors.

Gardening Services

We provide gardening services for the common areas of the properties we manage, which primarily include irrigating, fertilisation and pruning of the greenery. We provide gardening services mainly through Independent Third Party subcontractors.

Repair and Maintenance Services

We are generally responsible for the repair and maintenance of the elevator system, utility supply system, drainage system, electromechanical equipment, fire extinguishing system and barrier gate system and other facilities and equipment in the common areas of the properties we manage. For certain properties, generally non-residential properties, our services also include the maintenance of heating and air-conditioning facilities. We generally provide repair and maintenance services through our own employees and Independent Third Party subcontractors.

Car Park Management Services

We provide management services for the car parks owned by property developers and property owners, which generally include entry and exit control and surveillance. We generally provide car park management services through our own employees.

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Property Management Service Agreements

Residential Properties

We generally enter into preliminary property management service agreements with residential property developers at the construction and pre-delivery stage of property development projects. A preliminary property management service agreement governs property management services we provide to owners and residents of properties that have already been delivered but for which the property owners’ associations have not entered into a new property management agreement. During the Track Record Period, a majority of our revenue from general property management services was generated from preliminary property management service agreements entered into with property developers. We also typically enter into preliminary property management service agreements with individual property owners at the time of sales of properties to confirm the terms as set out in the preliminary property management service agreements entered into between the property developer and us, pursuant to which the individual property owners are required to pay the property management fee after the delivery of the relevant properties.

In relation to properties that have already been delivered and for which property owners’ associations have been established, we enter into property management service agreements with property owners’ associations acting on behalf of property owners.

– 147 – The table below sets forth a breakdown of our number of projects of residential properties and GFA under management as at the DOCUMENT. THIS BE OF MUST COVER INFORMATION THE THE ON THAT “WARNING” AND HEADED CHANGE SECTION TO THE SUBJECT WITH AND CONJUNCTION INCOMPLETE IN FORM, READ DRAFT IN IS DOCUMENT THIS dates indicated, as well as revenue from general property management services for the periods indicated by counterparties of the preliminary property management service agreements and property management service agreements:

Residential Properties Property developers and property owners ...... 30 4,701.6 89.5 91,298 90.1 28 4,597.7 84.3 97,443 84.9 30 4,835.3 85.0 104,533 85.6 Property owners’ associations ...... 4 552.5 10.5 10,086 9.9 5 854.1 15.7 17,269 15.1 5 854.1 15.0 17,588 14.4 BUSINESS Total ...... 34 5,254.1 100.0 101,384 100.0 33 5,451.8 100.0 114,712 100.0 35 5,689.4 100.0 122,121 100.0 4 – 148 – 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

The following diagram illustrates our relationships with various parties under our property management service agreements.

Pay property management fee before delivery

Preliminary property management service agreements Our Group Property developers

Provide general property management services before property delivery

Provide general property Property management services management Pay property Sell property after property delivery service management agreements fee

Property owners’ Property owners associations Establish property owners’ associat ion

Contractual relationship

Non-residential Properties

We generally obtain the general property management service agreements for non-residential properties through business negotiations at arm’s length with the property developers or property owners. A property management service agreement for non-residential properties governs general property management services we provide to non-residential property developers before property delivery and/or to property owners after property delivery. During the Track Record Period, we provided general property management services to 9, 10 and 12 non-residential properties in 2018, 2019 and 2020 with GFA under management of 0.5 million sq.m., 0.6 million sq.m. and 0.7 million sq.m., respectively.

Property Management Fees

We charge property management fees on a lump sum basis during the Track Record Period where we act as the principal provider of property management services, and recognise the entire amount received or receivable as our revenue, and all related costs as cost of sales, over the service period.

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Lump Sum Basis

Under the lump sum basis, we charge a fixed property management fee per sq.m. of GFA under management on a regular basis which represents an all-inclusive fee for all property management services provided by us and our third-party subcontractors. In general we are entitled to retain the full amount of property management fees received from property developers, property owners and residents as revenue and we also bear costs incurred in providing our property management service as our cost of sales. If the property management fees we charge during the term of property management service agreements are not sufficient to cover all the costs incurred, we bear the loss and may not request property developers, property owners or residents to pay us the shortfall. According to CIA, the lump sum basis is the primary fee model for property management services in China.

In 2018, 2019 and 2020, we incurred losses of RMB1.4 million, RMB1.8 million and RMB0.9 million, respectively, with respect to seven, six and three properties under our management, respectively. For these projects, the amount of property management fees we received was insufficient to cover the service costs incurred to offer quality property management services. The reasons for incurring losses for these properties include (i) we started to provide property management services to certain of these properties earlier than other properties we manage and the then market price of property management fee was relatively low and (ii) the dispersed layout of certain of these properties increased our labour costs. 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 improving the efficiency of our employees as well as enhancing the levels of standardisation through our smart management information and automated technology systems; (iii) promoting community value-added services in those properties, which typically generate higher profit margins than general property management services; (iv) implementing cost saving measures such as sub-contracting certain property management functions to external contractors. Our revenue from property management services from such loss-making properties was approximately RMB17.5 million, RMB15.7 million and RMB9.3 million in 2018, 2019 and 2020, respectively, representing 8.8%, 7.0% and 3.9% of our total revenue for the same periods, respectively. Pleases refer to the section headed “Risk Factors—Risks Relating to Our Business and Industry—We may be subject to losses and our profit margins may decrease if we fail to control our costs in rendering our property management services on a lump sum basis” in this document.

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Commission Basis

During the Track Record Period, we did not derive revenue from property management services agreements on a commission basis. Property management fees charged on a commission basis normally recognise a predetermined property management commission fee, generally representing a percentage of the property management fees, as revenue, while the remainder serves as working capital to cover the property management costs and expenses we incurred in providing the property management services. Any excess or shortfall of the property management fees (after deducting the relevant expenses) belong to or are borne by the property owners, property developers or residents from whom the property management companies receive the property management fees.

Our Pricing Policy

We generally price our services based on a number of factors, including (i) local regulatory requirements or guidelines for property management fees; (ii) types, sizes and locations of the properties; (iii) the prevailing market price of the local market; (iv) our estimated costs and expenses and target profit margin; (vi) the scope and quality of our services. Under the property management service agreements, we may raise property management fees upon renewal of the agreements as approved by a requisite number of property owners in accordance with relevant PRC laws and regulations.

We are also subject to pricing control issued by the PRC government. In December 2014, the NDRC issued the Circular of NDRC on the Opinion on Liberalising 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》 ( ) which requires provincial-level price administration authorities to liberalise the price control guidance policies on residential properties, with certain exceptions. Please refer to the section headed “Regulatory Overview—Regulations on the Fees Charged by the Property Management Enterprise” in this document.

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The following table sets forth the average property management fee per sq.m. of the properties under our management by developer type for the years indicated.

For the year ended 31 December 2018 2019 2020 RMB per sq.m. per month

Residential properties Ronghui Group(1) ...... 2.00 2.03 2.05 Joint ventures and associates of Ronghui Group(2) ...... 2.15 2.15 2.15 Independent third-party property developers(3)(4) ...... 0.90 0.90 – Overall average property management fee for residential properties ...... 1.99 2.03 2.06 Non-residential properties Ronghui Group(1) ...... 5.53 6.00 6.00 Joint ventures and associates of Ronghui Group(2)(5) ...... 3.95 3.95 4.06 Independent third-party property developers(3)(6) ...... – N/A N/A Overall average property management fee for non-residential properties . . . 4.97 5.31 5.24 Overall average property management fee ...... 2.20 2.25 2.28

Notes:

(1) Refers to properties solely developed by Ronghui Group or jointly developed by Ronghui Group and independent third-party property developers in which Ronghui Group held a controlling interest.

(2) Refers to properties jointly developed by Ronghui Group and independent third-party property developers in which Ronghui Group did not hold a controlling interest.

(3) Refers to properties developed solely by Independent Third Party property developers.

(4) In 2018 and 2019, we provided property management services to a residential property developed by an Independent Third Party property developer. The property management fee per sq.m. for this project was lower than our other projects because this project was developed in 2001 and the starting point of the property management fee at that time was much lower than our average property management fee for residential properties during the Track Record Period. In July 2019, we did not renew our property management service agreement with the property owners’ association of such property and ceased to provide property management services to such property mainly due to the fact that the increased management fees we proposed for providing the required level of services were not accepted by the property owners’ association of such property.

(5) Refers to community stores managed by us, for which we charged a relatively low property management fee as compared with other non-residential properties developed by Ronghui Group due to their commercial property type and positioning.

(6) Refers to the non-residential properties developed by Independent Third Party property developers and managed by us, for which we charged a package fee instead of property management fee based on GFA under management.

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As confirmed by CIA, the above average property management fees for residential and non-residential properties charged by our Group were comparable with industry peers operating in the same and/or proximity areas.

The table below sets forth the average property management fee of the properties we manage by geographical locations for the years indicated.

For the year ended 31 December 2018 2019 2020 RMB per sq.m. per month

Chongqing ...... 2.12 2.20 2.22 Jinan, Shandong Province ...... 2.49 2.39 2.39 Fuzhou, Fujian Province ...... 2.38 2.49 2.59 Wuhu, Anhui Province ...... 2.26 2.26 2.26 Overall average property management fee ...... 2.20 2.25 2.28

Payment and Credit Terms

Property management fees are generally due in advance on a monthly, quarterly or semi-annually basis in accordance with the agreement provisions and our management fees are charged on a lump sum basis.

We issue demand notes to property owners and/or property developers prior to payment due dates, and typically receive payments of our property management service fees after the issuance of the demand note, which, according to CIA, is consistent with the property management industry norm in the PRC.

We primarily accept payments for property management fees through bank transfers, online payment platforms and cash. We adopt different collection approaches, such as making phone calls, sending text messages, paying in-person visits, issuing legal collection letters and filing lawsuits.

If the property management fees become past due, we may call, text or send written notice to such customers to follow up, and may have our attorneys send demand letters to such customers. We may impose overdue fees for the overdue management fees. If the outstanding fees remain unpaid for more than three months, we may file a lawsuit against such customer to claim the outstanding amounts.

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Expiration Schedule of Property Management Service Agreements

The following table sets forth the expiration schedule of our property management service agreements as at 31 December 2020.

Contracted GFA Number of agreements ‘000 sq.m. % %

Property management service agreements without fixed term(1) ...... 7,018.7 84.6 46 80.7 Property management service agreements expiring in Year ending 31 December 2021 . . . 613.6 7.4 3 5.3 Year ending 31 December 2022 . . . 259.1 3.1 2 3.5 Year ending 31 December 2023 and beyond ...... 407.2 4.9 6 10.5 Subtotal ...... 1,279.9 15.4 11 19.3

Total ...... 8,298.6 100.0 57 100.0

Notes:

(1) Includes preliminary property management service agreements we entered into with property developers. Such agreements can be terminated when the property owners’ associations are formed and decide to select other property management companies.

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The following table sets forth movements of our contracted GFA and GFA under management during the years indicated.

For the year ended 31 December 2018 2019 2020 GFA GFA GFA Contracted under Contracted under Contracted under GFA management GFA management GFA management (sq.m. in thousands)

As at the beginning of the period ...... 6,661.9 4,980.2 7,490.5 5,726.6 7,902.3 6,022.7 New engagements(1) .... 863.8 781.6 454.9 339.2 396.3 333.0 Terminations(2) ...... (35.2) (35.2) (43.1) (43.1) – –

As at the end of the period ...... 7,490.5 5,726.6 7,902.3 6,022.7 8,298.6 6,355.7

Notes:

(1) Primarily includes (i) preliminary property management service agreements entered into with property developers for new properties; and (ii) property management service agreements for residential properties that replaced their previous property management companies. The renewed agreements are not regarded as new engagements entered into during such year. The GFA under management includes the newly delivered GFA we contracted in prior years.

(2) Primarily arose out of non-renewal of certain property management service agreements.

In 2018, 2019 and 2020, the retention rate of the properties we manage was 97.7%, 97.7% and 100%, respectively, which we believe reflect our capabilities in offering quality property management services. During the Track Record Period, we did not renew two property service agreements for residential properties after their expiration, which was mainly due to the fact that management fees we proposed for providing the required level of services were not accepted by the respective property owners’ associations and our decision to reallocate resources to more profitable engagements, or as a result of the delivery of the project to government.

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Obtaining Property Management Service Agreements

During the Track Record Period, we generally obtained preliminary property management service agreements by participating in tender and bidding, a process where property developers and property owners’ associations evaluate and select from multiple property management service providers. The flow chart below illustrates each stage of our typical tender and bidding process for obtaining preliminary property management service contracts:

Receiving invitation or notice regarding the tender process or bidding opportunity

Establishing project team responsible for the tender and bidding

Submitting documents for pre-qualification

Preparing budgets based on the details of the property

Submitting tender bids setting out our plans, costs qualifications and others

Tender evaluation process

Receiving notice of tender awarding or rejection

Signing of the property management service agreements if awarded tender or analysing reasons if rejected

Tender invitations are usually issued by property developers for properties under development, or from property owners’ associations for properties that wish to replace their existing property management service provider. After receiving the tender invitations, we submit tender documents to the property developer or property owners’ associations which generally include proposed pricing, proposal and plan for property management and other information as specified by the tender invitation.

In considering the proposed project, we will conduct a market analysis of the area and obtain key information, such as the infrastructure and property development plans in the vicinity, the demography in the region and the local government policy, etc. We then assess factors such as the expected rate of return, property type and size, competition for the project. We will then compile a property management proposal comprising and/or taking into account the following: (i) scope of services to be provided; (ii) number of staff required; (iii) standard and quality of services appropriate for the property; (iv) scope of any value-added services; (v) facilities available within the property; (vi) the stage of the property development.

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We may be required to provide pre-qualification documents for vetting before submitting the formal tender documents. The property developers and property owners’ associations will then evaluate the tenders received, and select the winner based on factors such as reputation, quality of service, management system, human resources management and the proposed management plan. After winning the tenders, we enter into property management service agreements with the relevant property developers and property owners’ associations, and then file the agreements with the relevant authorities where applicable under PRC laws and regulations. During the Track Record Period, the success rate of our tender bids for preliminary property management contracts in respect of properties developed by Ronghui Group and its joint ventures and associates was 100.0%. During the Track Record Period, we participated in 22 tender and bidding processes for properties developed by Independent Third Party property developers and achieved a tender success rate of 23%. We achieved low tender success rate during the Track Record Period primarily because we were in the stage of optimising our internal incentive mechanism for our business development personnel and other employees for successful biddings and enhancing the experience in bidding for projects developed by Independent Third Party property developers of our business development team. Going forward, for the purpose of increasing tender success rate for properties developed by Independent Third Party property developers, we (i) have developed a specific professional business development team to bid for projects developed by Independent Third Party property developers; (ii) plan to formulate internal incentives and assessment mechanisms to mobilise our employees and expand our project information data base; (iii) plan to co-operate with project partners in a form of associations and joint ventures to bid for projects; and (iv) plan to encourage our employees to obtain relevant qualifications and certificates in the property management industry to improve the competitiveness of our project proposals.

Under the PRC laws and regulations, property management companies are required to obtain preliminary property management service agreements for residential properties through tender processes unless a property is considered as a small-scale property, or there are fewer than three bidders, and in any of those cases, the developer may select and appoint property management companies with corresponding qualifications through direct negotiation with the approval of the real estate administrative department of the county level where the property is located.

The tender process requires a minimum of three bidders. Generally, approximately five to seven bidders participate in a tender process. For higher quality projects, the number of bidders could be even higher. The bidders other than ourselves are generally independent regional or national property management companies that possess the necessary qualifications to submit a bid for the tendering process. The tender process will be evaluated by a tender evaluation committee organised under the Interim Measures for Tender and Bidding Management for Preliminary Property Management《前期物業管理招標投標管理暫行辦法》 ( ) where neither the property developer nor we would be able to exert influence on the selection process. The tender evaluation committee shall consist of an odd number of at least five members, including: (i) at least a two-thirds majority of property management experts who are independent of the relevant developer and our Group and are selected on a random basis from a list of experts compiled by the local real estate administrative department; and (ii) the representative members from the property developer. In evaluating the bids, the tender evaluation committee would consider a number of factors, including reputation, quality of service, management system, human resources management and the proposed management plan.

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During the Track Record Period, we procured all of our preliminary property management service agreements from property developers through (i) tender procedures regulated by applicable PRC laws or (ii) commercial negotiation pursuant to approvals obtained from relevant local authorities or otherwise not compulsorily required by applicable PRC laws. We had entered into two preliminary property management service agreements (the “Relevant Property Management Projects”) with Ronghui Group through commercial negotiation pursuant to approvals obtained from relevant local authorities. The total contracted GFA of the Relevant Property Management Projects is 52,667.1 sq.m. and accounted for 0.6% of our total contracted GFA as 31 December 2020. Revenue generated from the Relevant Property Management Projects amounted to RMB1.5 million, RMB2.0 million and RMB1.6 million in 2018, 2019 and 2020, respectively, representing 0.7%, 0.9% and 0.7% of our total revenue during the same periods.

As advised by our PRC Legal Advisors, the preliminary property management agreements of the Relevant Property Management Projects entered into with the developers directly with the approvals of the competent local authorities does not violate the tender process requirement under the Regulations on Property Management《物業管理條例》 ( ).

Key Terms of Agreements with Property Developers

Our preliminary property management service agreements with property developers typically include the following key terms:

• Scope of services. A typical agreement with a property developer sets out the scope of services, which typically includes repair, maintenance and management of the common areas and the facilities, equipment and auxiliary structures in the common areas, gardening, cleaning, traffic and car park management, security management, fire safety management, property documentation management and decoration management.

• Performance standards. The agreement sets forth specific standards in accordance with the relevant standards under the local regulations, which typically include the respond rate of customer hotline, the repair response time and the customer satisfaction rate.

• Property management fees. The agreement sets forth the amount of property management fees per sq.m. per month and the GFA covered, as well as whether the fee is payable on a lump sum or commission basis. The property developer is responsible for paying the property management fees for unsold property units, which typically begin to accrue upon the execution of the property management service agreement until delivery of the relevant unit to a property purchaser. The property owner is responsible for paying the property management fees starting from the date of the delivery notice. We also charge a late fee for overdue property management fees, which is typically a percentage of the overdue amount. For properties with carparks, we also set out our fee rate for each carpark space per month.

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• Property developer’s rights and obligations. The property developer is entitled to (i) review and approve property management service proposals and annual service plans; (ii) inspect and supervise our services and our implementation of the property management policies; and (iii) formulate the property management policies in relation to the use of common areas, public order and environmental hygiene. The property developer is typically responsible for (i) formulating temporary property management rules and requiring the purchasers of the properties to follow; (ii) incorporating the relevant requirements in the preliminary property management service agreement into the property sale and purchase agreement; (iii) ensuring the properties are in compliance with relevant property inspection standards and the facilities and equipment are fit for purpose; (iv) offering blueprint; records and other materials to us upon delivery; (v) seeking approval from property owners and us before commencing construction works which would temporary occupy roads or common areas and reinstating before the agreed time limit; (vi) informing property owners and residents to cooperate with the property management works and follow property management policies; (vii) not disposing the legal rights of possession and use of the common areas enjoyed by the property owners; and (viii) providing to us necessary office are to carry out our services.

• 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) reporting material matters in relation to property management to all property owners and handling complaints in a timely manner; (iii) cooperating with the supervision by property developers, property owners and residents; (iv) inspecting the property upon delivery; (v) formulating property management plans and budget; (vi) monitoring property use and ensuring compliance with relevant laws and regulations; (vii) not changing the function of or occupying the common area without permission of the property owners and proper procedures; and (viii) collecting property management fees in accordance with relevant agreements and regulatory requirements.

• Term of service. Unless there is a fixed term, the agreement typically expires after the property owners’ association is established and the property management service agreement between the property owners’ association and the property management service provider become effective.

• Dispute resolution. Parties are typically required to resolve any contractual dispute through negotiations first, failing which the dispute is to be resolved through arbitration or court proceedings.

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After delivery of the properties by property developers, property owners may form and operate property owners’ associations. For properties where we have entered into preliminary property management service agreements with property developers without fixed terms, property owners and residents are obligated to pay property management fees to us until the property owners’ associations enter into new property management service agreements with the property management companies selected by the general meetings of the property owners and the new agreements become effective.

Key Terms of Agreements with Property Owners’ Associations and Property Owners

Our property management service agreements with property owners’ associations and property owners typically include the following key terms.

• Scope of services. The agreement sets forth our scope of services, which typically includes property management services to common areas and facilities, such as security, cleaning, greening and gardening, managing common area traffic and parking, repairing and maintaining public facilities, managing the carparks, and record keeping.

• Performance standards. The agreement sets forth specific standards in accordance with the relevant standards under the local regulations, which typically include the response rate of customer hotline, the repair response time and the customer satisfaction rate.

• Property management fees. The agreement sets forth the amount, basis (lump sum or commission) and calculation method of property management fees. The amount of property management fees for each period is dependent on the GFA occupied by property owners and residents, as well as property types. The agreement may also include a fee schedule for additional services beyond the scope of services mentioned above, such as parking space management services, which property owners may select based on their needs. We may impose surcharges on property owners or residents who fail to pay property management fees on time.

• Rights and obligations of property owners’ associations. The property owners’ association has the right to (i) renew agreements with us or terminate us for cause; (ii) supervise the performance of the property management service agreement and our management team; (iii) review and approve property management plans and budget; (iv) review the use of specialised repair fund and inspect the repair works. Under the supervision of property owners, property owners’ associations are responsible for (i) assisting us in collecting property management fees from the property owners or residents; (ii) assisting us in repairing works and coordinate with the property owners; (iii) collecting the contributions to the specialised repair fund; (iv) assisting us in organising property management promotion and activities; and (v) assisting us in reporting non-compliance activities of the property owners and residents.

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• Our rights and obligations. We are entitled to timely collection of property management fees as provided in the agreement. We may outsource certain services, but not the property services as a whole, to qualified subcontractors. We are in turn responsible for (i) providing the services included in the agreement; (ii) reporting material matters in relation to property management to all property owners and handling complaints in a timely manner; (iii) cooperating with the supervision by property developers, property owners and residents; (iv) inspecting the property upon delivery; (v) formulating property management plans and budget; (vi) monitoring property use and ensuring compliance with relevant laws and regulations; (vii) not changing the function of or occupying the common area without permission of the property owners and proper procedures; and (viii) collecting property management fees in accordance with relevant agreements and regulatory requirements.

• Term of service. The agreement term is typically one to three years from the date of signing and is automatically renewable until terminated or the change of property owners’ association. The property owners’ association shall hold a general meeting to decide whether to renew the property management service agreement 90 days before its expiry date. If property owners’ association decides not to renew the agreement, it is typically responsible for delivering 60-day notices. The property management service agreement will terminate upon the new property management service agreement taking effect. If, upon the expiration of a preliminary property management service agreement, the property owners’ association has not entered into a new property management service agreement with us or other property management service provider, the property management service agreement will be renewed automatically until a new property management service agreement is entered into. We may be responsible for transitioning the property management work to our successor. The property owners’ association and we both have the right to terminate the agreement prior to the expiration of the agreement term for causes listed in the agreement. Such causes typically include (i) the demolition of the property; (ii) force majeure factors; (iii) our breach of contract which leads to the general meeting of the property owners’ association decide to terminate the agreement; (iv) half or more of the property owners fail to perform the property management service agreement and we decide to terminate the agreement; and (v) our failure to offer satisfactory services which leads to the disordered management of the property and the property owners’ association decides to terminate the agreement.

• Dispute resolution. Parties are required to resolve any contractual dispute through negotiations first, failing which the dispute is to be resolved through arbitration or court proceedings.

As at 31 December 2020, we provided property management services for five residential properties pursuant to our property management service agreements with property owners’ associations, which accounted for approximately 14.3% of the total number of residential properties under our management. The success rate of entering into property management agreements with property owners’ associations after the preliminary stage was 75% during the

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Track Record Period and up to the Latest Practicable Date. The property owners’ associations are independent from us. The property owners’ association may either hire new property management service providers through competitive bidding or enter into a contract with a property management service provider directly based on specified standards, such as terms and conditions of service, service quality and service price.

According to relevant PRC laws and regulations, it is not mandatory and there is no time limit for property owners to form a property owners’ association for both residential and non-residential properties. The election of property owners’ association and the selection, employment and dismissal of a property management service provider shall be subject to the approval by property owners who possess exclusive areas accounting for more than two-thirds of the total GFA and the said property owners shall account for more than two-thirds of the total number of the property owners. In the event that the property owners’ association has not entered into a new property management agreement, the preliminary property management contract entered into between the property developers and us at the pre-sale and pre-delivery stages (the “Preliminary Property Management Service Agreement”) would remain effective and bind the owners of the properties, who are obligated to pay the management fees directly to us. The Preliminary Property Management Service Agreement will be terminated when the property owners’ association is formed and a new property management agreement is entered into. If, upon the expiration of the initial term of the Preliminary Property Management Service Agreement, the property owners’ association has not been formed or a new property management agreement has not been entered into between the property owners’ association and us, (i) the Preliminary Property Management Service Agreement will be renewed automatically until a new property management agreement with the property owners’ association is entered into if there is applicable provision in the Preliminary Property Management Service Agreement to that effect, or (ii) in the absent of any automatic renewal provision, 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 provide.

According to relevant PRC laws and regulations, the property owners’ association is elected by property owners, and represents their interests in matters concerning property management. The decisions of property owners’ association are binding on all property owners. Under the PRC laws and regulations, the agreements between property owners’ associations and property management companies hired according to the relevant laws and regulations by the general meeting are legally binding on property owners, even if the property owners are not themselves parties to such agreement. As a result, we have legal claims against property owners for accrued and outstanding property management fees.

During the Track Record Period, we continued to provide property management services to two projects whose property owners’ associations were dissolved during the terms of our contracts with them based on the terms and conditions as provided in the existing contracts. In 2018, 2019 and 2020, our revenue generated from these two projects were RMB5.9 million, RMB5.7 million and RMB5.7 million, respectively. As at the Latest Practicable Date, these two projects had not formed new property owners’ association. During the Track Record Period, we had three expired property management agreements with fixed term where we still continued to provide property management services and received property management fee after the expiration date of these agreements. In 2018, 2019 and 2020, our revenue generated from those

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Key Terms of Property Management Service Agreements for Non-residential Properties

We enter into property management service agreements with customers such as property owners and property developers for the management of non-residential properties. Our property management service agreements for non-residential properties typically include key terms which are generally consistent with the terms contained in property management service agreements in residential properties under our management, such as scope of services, performance standards, property management fees, the parties’ respective rights and obligations, terms of service and dispute resolutions.

Value-added Services to Non-property Owners

We also provide a series of value-added services to non-property owners, primarily property developers. In 2018, 2019 and 2020, our revenue generated from our value-added services to non-property owners amounted to RMB23.0 million, RMB26.5 million and RMB28.3 million, respectively, representing 13.9%, 14.2% and 13.9% of our total revenue from property management services for the same periods, respectively. The following table sets forth a breakdown of our revenue generated from each category of the value-added services to non-property owners for the periods indicated.

As at 31 December 2018 2019 2020 (RMB’000) (%) (RMB’000) (%) (RMB’000) (%)

Preliminary design and planning consultancy services ...... 94 0.4 667 2.5 1,232 4.4 Pre-delivery inspection services ...... 648 2.8 1,409 5.3 2,971 10.5 Repair and maintenance services ...... 1,616 7.0 1,690 6.4 2,412 8.5 Sales centre management services ...... 9,448 41.1 9,949 37.5 11,423 40.3 Additional tailor-made services ...... 11,161 48.7 12,806 48.3 10,275 36.3

Total ...... 22,967 100.0 26,521 100.0 28,313 100.0

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Preliminary Design and Planning Consultancy Services

We provide various preliminary consultancy services which address property developers’ needs at different stages of their business operations. We provide consultancy services to property developers to enable them to better understand the needs of their targeted property owners and residents, so that the property developers can deliver building designs that match such requirements. Property developers engage us for such services to improve their own project design and performance more from the end users’ perspective as we have closer access to property owners’ and residents’ needs and requirements through our own provision of property-related services on a daily basis. At the preliminary design and planning stage, we participate in the evaluation of the developers’ construction blueprints and other construction planning documents, offer recommendations from a property management and customer use perspective, such as advice on choices of materials and equipment, user convenience and completeness of the ancillary facilities. We also provide on-site inspection assistance services during the construction process to assist in monitoring the construction progress and identify any quality issue that needs to be addressed. We provide preliminary planning and consultancy services mainly through our own employees. We typically charge fees on a per sq.m. basis taking into account factors such as our standard fee schedule and our costs. The fee is payable by stages from signing of the agreement to mass delivery.

Pre-delivery Inspection Services

We offer construction quality inspection services to property developers before the property is delivered to the property owners and provide suggestions on the adequacy of the construction quality from the perspective of the targeted property owners and residents. Our services include conducting on-site quality inspections according to the quality guidelines provided by the property developers, assessing the quality issues, reporting to the property developers and conducting follow-up visits to ensure that the issues are resolved. We provide pre-delivery inspection services mainly through our own employees. We typically charge fees on a per sq.m. basis, taking into account factors such as our standard fee schedule and our costs. The fee is payable upon signing of the agreement.

Repair and Maintenance Services

We offer repair and maintenance services to property developers after the delivery of new projects. After the delivery, property owners or residents may identify quality issues of the new properties, such as leakage and door and window malfunctions. Property developers engage property management companies to provide repair and maintenance services and to solve the quality issues. We provide repair and maintenance services mainly through our own employees and third party subcontractors. We typically charge reasonable management fee in addition to our costs. The fee is typically payable upon the completion of the relevant repair and maintenance works.

Sales Centre Management Services

We provide property management services to property developers with respect to their sales demonstration areas, such as repair and maintenance services, cleaning and gardening services and security and safety services. We do not participate in the sales transactions between

– 164 – 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 property developers and their customers. Under our sales centre management agreement, we are obligated to follow the service standards specified by our customers, while our customers are obligated to provide us the facilities and equipment necessary to provide our services. We provide sales office management services mainly through our own employees and third-party subcontractors. Our sales centre management agreements generally have a term of one year and can be renewed by mutual consent upon prior notice. We typically charge property developers a fixed service fee based on the nature and scope of services that we provide, the number and function of staff we deploy per month, payable on a monthly or quarterly basis.

Additional Tailor-made Services

We provide additional tailored services to property developers, including, among others, office cleaning services and other public facilities management services to property developers. We provide our additional tailored services through our employees and third party subcontractors. We provide such services with separately signed agreements and collect fees based on lump sum basis as agreed.

Community Value-added Services

As an extension of our general property management services, we provide community value-added services to property developers, property owners and residents of our managed properties to address their daily needs, enhance their living experience and create a healthier and more convenient living community. Our community value-added services mainly consist of home-living services, sales assistance services, temporary car park management services and common area value-added services.

In 2018, 2019 and 2020, our revenue generated from community value-added services amounted to RMB16.5 million, RMB18.8 million and RMB26.5 million, respectively, representing 10.0%, 10.1% and 13.1% of our total revenue from property management services for the same periods, respectively. The following table sets forth a breakdown of our revenue generated from each category of the community value-added services for the periods indicated.

For the year ended 31 December 2018 2019 2020 (RMB’000) (%) (RMB’000) (%) (RMB’000) (%)

Temporary Car Park Management Services . . 9,668 58.7 11,046 58.8 12,883 48.6 Sales Assistance Services . – – 491 2.6 6,409 24.2 Common Area Value-added Services . . 6,427 39.0 6,950 37.0 6,248 23.6 Home-living services .... 369 2.3 292 1.6 984 3.6

Total ...... 16,464 100.0 18,779 100.0 26,524 100.0

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Temporary Car Park Management Services

We provide management services for the temporary car parks owned by property developers or all property owners as a whole, which generally include entry and exit control, surveillance and collection of parking fees. We generally charge users of the temporary car parks on hourly rate basis. According to our preliminary property management service agreements with relevant property developers, we normally charge a fixed percentage of the parking fees we receive. According to our property management service agreements with the relevant property owners’ associations, we normally provide a fixed amount package fee or fixed percentage of the parking fees we receive to the relevant property owners’ associations and recognise the remaining parking fees we receive as revenue.

Sales Assistance Services

We provide sales assistance services to property developers and property owners, which generally include car parking space sales services and housing rental services. We charge the seller or owner a fixed amount commission with reference to the prevailing market price, the location of the car park and the expected costs.

Common Area Value-added Services

We provide property owners with certain value-added services such as the management of advertising in common areas, for example, basements, elevators and exterior wall advertising spaces and rental of common areas. We collaborate with third party suppliers by leasing venue to them for showcasing to and interacting with the property owners and residents of our managed properties. We mainly charge rental fee for our common area value-added services.

Home-living Services

We provide various home-living services, such as housekeeping, group buying, repair and maintenance and travelling. We offer housekeeping and cleaning services either by our own employees or through third-party subcontractors. We have implemented our household cleaning procedures, which set forth service standards, cleaning procedures and occupational etiquette. We offer purchase assistance for a full range of products and services for sale by merchants, primarily through our Xiaohui Dangjia App and mini mobile application. Residents may also place orders at our property management office or through our Xiaohui Dangjia App and mini mobile application. We also provide home decoration services and community activities to our residents. We also assist the residents to arrange customised travel products. Our connection with residents through our property management services helps us better understand and respond to their demands.

COMMERCIAL OPERATIONAL SERVICES

Overview

We provide commercial operational services to a diversified portfolio of commercial properties, including cultural tourism properties (including hot spring resorts), shopping malls, theme streets, neighbourhood centres, shopping streets and community stores. We began to provide commercial operational services to commercial properties in 2012. As at 31 December

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2018, 2019 and 2020, our total contracted GFA under commercial operational services segment was 0.3 million sq.m., 0.3 million sq.m. and 0.3 million sq.m., respectively. In 2018, 2019 and 2020, our revenue generated from commercial operational services amounted to RMB34.1 million, RMB37.4 million and RMB38.1 million, representing 17.2%, 16.7% and 15.8% of our total revenue for the same period respectively.

The table below sets forth a breakdown of our total revenue from commercial operational services by service category for the years indicated:

For the year ended 31 December 2018 2019 2020 (RMB ‘000) (%) (RMB ‘000) (%) (RMB ‘000) (%)

Commercial operational services to tenants business management services ...... 33,831 99.2 37,430 100.0 31,836 83.6

Commercial operational services to property developers and property owners market research and positioning services . . ––––1,211 3.2 tenant sourcing services 282 0.8 – – 2,478 6.5 pre-opening preparatory services . ––––2,547 6.7

Total ...... 34,113 100.0 37,430 100.0 38,072 100.0

During the Track Record Period, substantially all commercial properties under our management for which we provided commercial operational services were projects developed by Ronghui Group (with the exception of Zhongtingjie Shijilianhua Commercial Port with contracted GFA of 5,000.0 sq.m. for which we provided tenant sourcing services in 2018 and generated revenue of RMB0.3 million). On 9 April 2021, we entered into a commercial operational service agreement for tenant sourcing services to Banan Yudong Old Street (巴南魚洞老街), a property located in Chongqing developed by Independent Third Party property developer with a total GFA available for tenant sourcing of 25,756.9 sq.m. We plan to continue to actively explore opportunities of providing our commercial operational services to projects developed by Independent Third Party developers. Please refer to the paragraph headed “—Our Strategies—Reinforce our market position in key regions and further develop our business through enlarging our business scale, expansion in regions with strong growth potential and further optimise our project portfolio” above for further information.

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Scope of Services

The commercial operational services we provide primarily comprise (i) commercial operational services to tenants; and (ii) commercial operational services to property developers and property owners, details of which are set out as follows:

(i) Commercial operational services to tenants (generally provided after the opening of the commercial properties)

Business management Tenant coaching — We strive to help tenants achieve services better business performance through providing assistance to monitor and analyse their business data and provide training and advice to tenants’ staff on store display, improvement of service quality, building strong consumer relations, advising tenants on store layout and interior design and business category adjustment;

Marketing and promotion services — We hold various promotional activities including holiday sales, public relation and promotion events, aiming to attract traffic to our commercial properties and increase tenants’ sales; and

Subleasing services – We sublease certain commercial properties that we lease from the property developers to the tenants. We also provide general property management services and commercial operational services for the subleased properties.

(ii) Commercial operational services to property developers and property owners (generally provided before the opening of the commercial properties)

Market research and We conduct market research and analysis, functional positioning services layout planning, business positioning and rental strategy, professional engineering advisory and business design advisory.

Tenant sourcing services We help property owners to identify and solicit target tenants, arrange the signing of tenancy agreements and manage the tenants.

Pre-opening preparatory We supervise the design and construction works, services manage the entry of tenants, formulate resources allocation plans, conduct on-site supervision and coordination works, advertising and promotion, public relations and other administrative services.

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We also provide commercial operational services after the opening of the commercial properties to property owners, including tenants agreement coordination and tenants management, advertising and promotion, public relation and other administrative services. We expect to generate revenue from such commercial operational services upon the opening of Ronghui Hot Spring Town G1 Ronghui Plaza in October 2021.

Geographic Presence

As at 31 December 2020, we provided commercial operational services to 13 projects in Chongqing, Fuzhou, Fujian Province, and Jinan, Shandong Province with a total contracted GFA of 0.3 million sq.m. We also proactively evaluate the business environment in other cities located in economically developed areas and may expand our commercial operational services into such cities when suitable opportunities arise. Please refer to the paragraph headed “— Our Strategies” above for further details. The map below illustrates the locations of properties we provide commercial operational services and were contracted to provide commercial operational services as at 31 December 2020.

Jinan, Shandong Number of projects: 2

Wuhu, Anhui(Note)

Fuzhou, Fujian Number of projects: 1

Chongqing Number of projects: 10

Note: In 2018 and 2019, we provided commercial operational services to projects located in Wuhu. We ceased to provide commercial operational services to projects located in Wuhu in June 2019.

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As at/for the year ended 31 December 2018 2019 2020 Number Number Number of of of projects Contracted GFA Revenue projects Contracted GFA Revenue projects Contracted GFA Revenue (sq.m.) (%) (RMB’000) (%) (sq.m.) (%) (RMB’000) (%) (sq.m.) (%) (RMB’000) (%)

Chongqing .... 9 207,686.6 73.7 19,869 58.2 9 204,698.3 76.8 23,273 62.2 10 222,221.3 77.4 26,816 70.4 Jinan, Shandong Province.... 1 41,172.0 14.6 7,857 23.0 1 41,172.0 15.4 8,880 23.7 2 44,172.3 15.4 7,873 20.7 Fuzhou, Fujian Province.... 1 20,450.8 7.3 4,232 12.4 1 20,680.2 7.8 3,805 10.2 1 20,752.6 7.2 3,383 8.9 Wuhu, Anhui Province BUSINESS 7 – 170 –

(Note) . 1 12,263.5 4.4 2,155 6.4 – – – 1,472 3.9 –––––

Total ...... 12 281,572.9 100.0 34,113 100.0 11 266,550.5 100.0 37,430 100.0 13 287,146.2 100.0 38,072 100.0

Note: In 2018 and 2019, we provided commercial operational services to projects located in Wuhu. We ceased to provide commercial operational services to projects located in Wuhu in June 2019. 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

Portfolio of Commercial Properties

Our commercial properties often include cultural tourism towns, neighbourhood centres, and shopping malls attached with the theme park with our the original IP “Rongtaotao”. Our featured commercial properties cover, among others, (i) cultural tourism towns as one of our core products, which focuses on featured cultural tourism properties and commercial towns; (ii) shopping malls positioned as large-scale regional shopping centres that provide consumers with a comprehensive consumption experience; (iii) theme streets that combine the cultural tourism features and commercial functions; (iv) neighbourhood centres that focus on community comprehensive consumption, serving as the one stop centres to solve the daily needs of property owners nearby; (v) shopping streets that provide consumers with a leisure and comprehensive consumption experience; and (vi) community stores located at the bottom of the residential properties, which provide the residents with convenient consumption experience. The original IP “Rongtaotao” theme park is open to the public without charges, providing consumers with more intimate care for children and improving consumer satisfaction. Cultural tourism towns, neighbourhood centres and shopping malls combined with residential properties, office buildings and other diversified commercial properties from the three dimensions of cultural tourism and commerce, community life and comprehensive shopping, create an integrated commercial ecosystem. Our commercial operational services provide full lifecycle services from market research and positioning, engineering, tenant sourcing, pre-opening preparation to business operations, ensuring that featured commercial projects are receiving professionalised and systematic services from the beginning of the projects.

The table below sets forth certain information of the commercial properties under our commercial operational services segment during the Track Record Period.

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(1) 79.2% 87.9% 87.5% 29,096.9 775 2,439 2,962 2. In-spring Town ...... June2013 Chongqing May 2013 10 years (1) 90.3% 95.7% 76.1% 28,468.6 5,149 5,981 5,846 3.QuanFangG3...... April2014 Chongqing January 2014 9 years 3 months and 25 days 92.0% 92.5% 94.3% 10,624.8 2,154 2,410 2,836 (1) 4.QuanFangG2...... January 2015 Chongqing January 2014 9 years 3 months and 25 days 49.0% 70.8% 56.9% 3,851.7 489 732 552 (1) 5. Commercial area of the hotels in Ronghui Hot Spring May 2013 Chongqing May 2013 10 years Town...... (1) 100.0% 100.0% 100.0% 4,803.0 968 1,033 1,215 shopping mall 6. Ronghui Hot Spring Town G1 Ronghui Plaza October 2021 Chongqing April 2020 18 months Shopping Centre ...... (estimated)

(2) N/A N/A N/A 36,900.4 – – 5,497 theme streets 7. 5DE Binjiang ...... October 2012 Chongqing October 2012 10 years

(1) 54.1% 75.1% 90.7% 13,899.8BUSINESS 619 851 1,147 8. Jinan 1904 Street (3) (2) ...... December 2020 JinanN/A December 2020 N/A N/A 1 year 3,000.3 – – 739 7 – 172 – neighbourhood centres 9. Meilin Town ...... July2016 Chongqing November 2015 10 years

(1) 97.7% 100.0% 99.5% 19,324.1 905 1,289 1,592 shopping streets 10. Ronghui Jinan Old Commercial Port ...... June2017 Jinan November 2015 10 years

(1) 99.5% 92.5% 88.5% 41,172.0 7,857 8,880 7,134 11. Binxi No. 66 ...... September2008 Fuzhou January 2015 10 years (1) 100.0% 99.2% 97.6% 20,752.6 3,950 3,805 3,382 community stores 12. Ronghui Peninsula Community Stores ...... October 2012 Chongqing October 2012 10 years

(1) 60.1% 62.1% 61.5% 62,815.6 4,681 4,847 3,825 13. Ronghui Hot Spring Town – Spring View Zone A (5)(6) (1) . May 2013 Chongqing May 2013100.0% 100.0% 10 years 100.0% 1,915.8 247 248 77 Ronghui Hot Spring Town – Spring View Zone B (5)(6) (1) (4) (4) . May 2013 Chongqing May 2013100.0% 100.0% 10 years3,482.3 N/A 485 515 – (5)(6) (1) Ronghui Hot Spring Town –. Spring May 2013 View Zone C Chongqing January 201489.1% 88.2% 10 years 92.9% 4970.4 3,332 2,775 1,012 Ronghui Hot Spring Town – Spring View Zone D (5)(6) (1) . May 2013 Chongqing September 201828.8% 57.0% 5 years 73.4% 1,704.9 7 50 40 Ronghui Hot Spring Town – Spring View Zone E (5)(6) (1) . May 2013 Chongqing September 201843.5% 33.7% 5 years 45.6% 363.0 58 103 216 14. Zhongtingjie Shijilianhua Commercial Project (3) (2) .... September2018 Fuzhou January 2018N/A N/A 9 months N/A 5,000.0 282 – – 15. Zhongjiang Guangchang ...... December 2016 Wuhu December 2016 2 years 6 months (1) 100.0% N/A N/A 12,263.6 2,155 1,472 –

Total ...... 34,113 37,430 38,072 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

Notes:

(1) The contract term reflects the term of agreement entered into between the property developer or property owner with us, pursuant to which we are granted the rights of providing commercial operational services to tenants for the relevant commercial properties.

(2) The contract term reflects the term of agreement entered into between the property developer or property owner with us, pursuant to which we provide commercial operational services such as market research and positioning services, tenant sourcing services and pre-opening preparatory services to property developers or property owners.

(3) We provided commercial operational services such as market research and positioning services, tenant sourcing services and pre-opening preparatory services to Jinan 1904 Street and Zhongtingjie Shijilianhua Commercial Project but did not provide commercial operational services to tenants after the opening of the these projects, primarily because these projects did not require commercial operational services to their tenants due to their scale.

(4) This property was sold by the property developer and we ceased to provide property management services to such property in 2019.

(5) For our commercial operational services, we consider different zones in a single commercial property as one project.

(6) The community stores of Ronghui Hot Spring Town opened with Ronghui Hot Spring Town as a whole in May 2013 and delivered for management by phases thereafter. The contract effective date reflects the first delivery date of the relevant zone.

During the Track Record Period, we were contracted to provide market research and positioning services, tenant sourcing services and pre-opening preparatory services to Ronghui Hot Spring Town G1 Ronghui Plaza Shopping Centre, which is expected to be opened in October 2021. We are also contracted to provide commercial operational and management services after its opening, including (i) business operational services; (ii) tenant management and rent collection services; and (iii) other value-added services. For certain commercial properties that contain shopping street, we provide property leasing services to units located within such shopping street. As different services are provided with respect to a commercial property over different stages of such commercial property, revenue derived from such commercial property may fluctuate.

Growth of Our Commercial Property Management Services Portfolio

We had been expanding our commercial property management services business during the Track Record Period primarily through obtaining new service engagements from Ronghui Group. In the future, we also plan to expand our coverage by signing commercial operational service agreements with Independent Third Party property developers and acquiring local commercial operational companies with complementary business profile and industry experience. The table below indicates the movement of our contracted GFA for the years indicated: As at 31 December 2018 2019 2020 Contracted Contracted Contracted GFA GFA GFA (sq.m.)

As at the beginning of the period ...... 271,936.2 281,572.9 266,550.5 New engagements ...... 17,578.6 16,086.5 42,023.5 Acquisitions ...... – – – Terminations ...... 7,941.9 31,108.9 21,472.8

As at the end of the period ...... 281,572.9 266,550.5 287,146.2

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Brands under Our Management

Our featured commercial projects cover a variety of theme features, such as catering, cultural tourism, urban business and neighbourhood centres. Below sets forth certain of our widely recognised featured commercial towns:

Ronghui Xiliutuo Town (融匯西流沱小鎮)

Ronghui Xiliutou Town is positioned as Chongqing’s cultural and tourism new landmark and an integrated area for business, cultural, art and leisure activities. Leveraging its distinctive architecture design with Chongqing features and our commercial operational services highlighting the culture of Chongqing, Ronghui Xiliutuo Town has multiple cultural and art brands that continuously provides fresh visual experience for visitors. Ronghui Xiliutuo Town also launched diversified cultural activities such as intangible cultural heritage performance, international cultural experience exchange week and pagoda light show. Ronghui Xiliutou Town was opened on 1 October 2018. As at 31 December 2020, Ronghui Xiliutou Town had a total contracted GFA of 29,096.9 sq.m. and had an overall occupancy rate of 87.5%. Ronghui Xiliutuo Town was awarded Chongqing Cultural Tourism New Landmark Internet Popularity Award (重慶文旅新地標網絡人氣獎) in 2019 and was awarded Most Beautiful Cultural Tourism Town, Best Food Town, Most Livable Town and Internet Popularity Award in the Searching and Presenting Most Beautiful Featured Town in Sichuan and Chongqing Activity (川渝最美特色小鎮尋找與展示活動) in 2020.

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Ronghui In-spring Town (融匯泉裡小鎮)

Ronghui In-spring Town is positioned as China’s leading hot spring leisure commercial cultural tourism town. It incorporates design concepts from international designers. Themed by hot spring tourism and urban entertaining, Ronghui In-spring Town creates a leisure business cluster with diversified types of operation combining featured catering, leisure entertainment, artworks as well as art and culture exhibition. Ronghui In-spring Town was opened on 22 December 2013. As at 31 December 2020, Ronghui In-spring Town had a total contracted GFA of 28,468.6 sq.m. and had an overall occupation rate of 76.1%. Ronghui In-spring Town was awarded the National AAAA Tourist Area in the name of “Ronghui Hot Spring Town” in 2017 and was awarded the Chongqing Cultural and Tourism New Landmark in 2019.

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Ronghui Jinan Old Commercial Port (融匯濟南老商埠)

Ronghui Jinan Old Commercial Port is located in the core area of Jinan’s commercial port and landscape zone. With the development concept of “revival and transcendence”, Ronghui Jinan Old Commercial Port aims to revive the historical features and prosperity hundreds years ago with a combination of the modern way of life. It covers cultural, tourism and commercial properties and integrates the city memories, cultural relics, traditional life scenes and commercial space, which makes Ronghui Jinan Old Commercial Port a thriving traditional street with cultural heritage, tourism and commercial functions. Ronghui Jinan Old Commercial Port was opened on 29 June 2017. As at 31 December 2020, Ronghui Jinan Old Commercial Port had a total contracted GFA of 41,172.0 sq.m. and had an overall occupation rate of 88.5%.

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Pipeline Projects

The table below sets forth certain information of each commercial property which we are contracted to provide commercial operational services but had not been in operation or we had not generated revenue from such commercial property as at the Latest Practicable Date:

Contracted Expected/actual Contract GFA Project name opening date Location effective date Contract term (sq.m.)

Ronghui Hot Spring Town October 2021 Chongqing January 2020 10 years 36,900.4 G1 Ronghui Plaza Shopping Centre (融匯溫泉城G1 融匯廣場購物中心) ......

Ronghui Peninsula Phase 13 December 2022 Chongqing April 2021 15 years 73,425.9 Ronghui Plaza Shopping Centre (融匯半島13期融匯廣場購物中心) ......

Banan Yudong Old Street October 2016 Chongqing April 2021 2 years 25,756.9 (巴南魚洞老街) ......

Total ...... 136,083.2

Ronghui Hot Spring Town G1 Ronghui Plaza Shopping Centre is positioned as parent-child family leisure shopping centre in Shapingba District of Chonging, which integrates retail, catering, supermarket, culture, lifestyle, children education, children retail, children amusement, activities, arts, social and creative features. It is designed to be the quality life centre of Ronghui Hot Spring Town and can leverage the scale effect and diversified customer traffic of the large-scale integrated property. We were contracted to provide business management services to Ronghui Hot Spring Town G1 Ronghui Plaza Shopping Centre after its opening.

Ronghui Peninsula Phase 13 Ronghui Plaza Shopping Centre is positioned as a district level shopping centre and a lifestyle experience centre in Banan District of Chongqing, which integrates shopping, catering, parent-child, entertainment and social features. It is designed to be the quality life centre of Ronghui Peninsula and can leverage the scale effect and diversified customer traffic of the large-scale integrated property. We were contracted to provide business management services to Ronghui Peninsula Phase 13 Ronghui Plaza Shopping Centre after its opening.

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Banan Yudong Old Street is positioned as a traditional cultural street that preserves the original historical and cultural features of the old street while integrating commercial, leisure and tourism features. It has six main areas consisted of featured catering area, bars and entertainment area, courtyard leisure area, folklore market area, specialty products area and museum exhibition area, which allow the visitors to learn more about the Ba culture (巴文化) while enjoying their leisure time. We were contracted to provide tenant sourcing services to Banan Yudong Old Street.

Commercial Operational Service Fees

The table below sets forth the service fee models and payment terms of each type of our commercial operational services.

Type of Service Fee Model and Payment Terms

Commercial operational services to tenants

Business management services • Monthly service fee on a per sq.m. basis for tenant coaching and marketing and promotion services

• Monthly service fee based on total GFA for subleasing services

Commercial operational services to property developers and property owners

Market research and Fixed service fee based on total GFA, which generally positioning services include a prepayment upon signing of contract and instalments according to our work progress

Tenant sourcing services Fixed monthly fee plus commission based on total GFA on the rental

Pre-opening preparatory Monthly fee based on total GFA services

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The diagram below illustrates our relationships with various parties under our commercial operational services business line:

1. Pre-opening commercial operational service agreements with property developers or owners 2. Post-opening commercial operational service agreements with 1. Commercial operational service property developers or owners (Note) agreements with tenants Our Group

1. Pre-opening services of projects: fixed fees for market research and positioning services, tenant 1. Pre-opening services of sourcing services and pre- projects: market research and opening preparatory services positioning services, tenant sourcing services and pre- Fixed fees for 2. Post-opening services: opening preparatory services business fixed fees for tenancy 2. Post-opening services: management agreement coordination and commercial operational and services tenant management, management services(Note) advertising and promotion, public relations and other administrative services(Note) 1. Tenant coaching services 2. Marketing and promotion services 3. Subleasing services

Property developers/ Property owners and Property owners Tenants

Note: We expect to generate revenue from these services upon the opening of Ronghui Hot Spring Town G1 Ronghui Plaza in October 2021.

Service Fees Charged on a Fixed Fee Basis

In general, we charge a fixed and all-inclusive fee for our market research and positioning, tenant sourcing and pre-opening preparatory services and business management services, which we provide through our own employees. We are entitled to retain the full amount of these fees collected from property owners, property developers or tenants as revenue and bear the costs incurred in providing such services.

Prior to negotiating and entering into agreements with the tenants, property owners or property developers, we seek to form an estimate as to our cost of services. Our cost of services includes, among others, staff costs and utility expenses. As we bear such expenses ourselves, our profit margins are affected by our ability to reduce our cost of services.

In the event that we experience unexpected increases in our cost of services, we may, according to the term of relevant agreements, propose to raise our service fees while negotiating to renew the relevant agreements.

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Over average commercial operational fee charged on tenants was approximately RMB14.8 per sq.m., RMB15.9 per sq.m. and RMB14.8 per sq.m. in 2018, 2019 and 2020, respectively.

Our Pricing Policy

For our commercial operational services for tenants, we generally price our services with reference to, among others, (i) business scope of the tenant; (ii) location of the commercial property; (iii) positioning of the commercial property; (iv) GFA of the shop leased by the tenant; and (v) brand value of the tenant.

For our commercial operational services for developers and property owners, we generally price our market research and positioning, tenant sourcing and pre-opening preparatory services, as well as business management services with reference to, among others, (i) brand, size and location of a commercial property; (ii) availability of utilities; (iii) the complication in tenant sourcing; and (iv) the service period.

Obtaining Commercial Operational Service Agreement

Commercial operational service agreements are not required to be obtained through a tender process. During the Track Record Period, we generally obtained commercial operational service agreements through commercial negotiation with the developers of the commercial property directly. The flow chart below illustrates each stage of our typical process for obtaining commercial operational service agreements.

Information collection and project set up

Project inspection

Internal budgeting

Project approval

Signing of agreement

Hand over of management by the property owner

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Key terms of Commercial Operational Services Agreements

We enter into pre-opening commercial operational service agreements with property developers or owners, which typically include the following key terms:

• Scope of services. A typical agreement sets forth the scope of operational services to be provided by us, which normally includes (i) market research and positioning service, tenant sourcing services and pre-opening preparatory services; and (ii) business operational services including rent collection and other value-added services.

• Service fees. Our agreements set forth the service fees for our commercial operational services. Please refer to the section headed “Business—Commercial Operational Services—Commercial Operational Service Fees” in this document for further details.

• Rights and obligations of the property developers or property owners. The property developer or owner is primarily responsible for, among other things, obtaining all licences, permits and consents for the operation of the commercial property and ensuring that all facilities in the relevant commercial property are in compliance with the requirements for commercial operations.

• Our rights and obligations. We are primarily responsible for, among other things, advising upon marketing and positioning strategies, assisting in tenant sourcing, providing commercial property management services, tenant management and rent collection services. In addition, we generally bear the operating costs incurred in our provision of services, including but not limited to, staff costs, training costs, cleaning expenses and tax expenses.

• Term of service. Our agreements generally have a term from the contract effective date to the opening date of the relevant commercial property, and will specify that property developer or owner must obtain our written consent before selling the commercial property in whole.

• Dispute resolution. Both parties are typically required to resolve any contractual disputes through negotiations first before resorting to arbitration or litigation.

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We enter into post-opening commercial operational service management agreements with property developers, who contracted with us to manage the commercial property on behalf of them. The agreements typically include the following key terms:

• Scope of services: A typical agreement sets forth the scope of management services provided by us, which normally includes (i) market research and positioning service (ii) marketing and positioning strategies (iii) business operational services such as rent collection.

• Service fees. During the terms of agreement, the property developers authorise us to collect commercial service fees from the tenants. We have the autonomy to collect such management fees, which are determined based on the scope of the business operation management services, parking space management services, and promotion services provided by us for the property developers.

• Rights and obligations of the property developers. The property developer is primarily responsible for, among other things, obtaining all licences, permits and have the right to formulate our relevant management policies, reviewing the budgeting and business planning and marketing strategies for the commercial property as well as assessing customer satisfaction rates, collecting feedback from the tenants, monitoring and supervising our management policies.

• Our rights and obligations. We are primarily responsible for, among other things, advising upon marketing and positioning strategies, providing commercial property management strategies, rent collection services, branding services and assisting in tenant sourcing.

• Term of service. Our agreements generally have fixed terms of ten years, and may be renewed upon our request in writing 60 days before the expiry of the agreement. We may negotiate with the property owner as to the renewal of the agreement.

• Dispute resolution. Both parties are typically required to resolve any contractual disputes through negotiations first before resorting to arbitration or litigation.

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We enter into commercial operational service agreements with tenants, which typically include the following key terms:

• Scope of services. We provide guidance on the tenant’s operations, including customer relations, store display, store layout and interior design. We also organise a variety of promotion activities to promote the business of the tenants and the commercial property as a whole.

• Service fees. The service fees for tenants are generally service fee on a per sq.m. basis, payable monthly or quarterly in advance.

• Rights and obligations of the tenant. Tenants have the rights of operation independently free from intervention by commercial operational services provider. Tenants shall comply with the relevant laws and regulations as well as the management policies formulated by us.

• Our rights and obligations. We have the rights to formulate relevant management policies for the commercial property. We are allowed to use the tenant’s name and trademark free of charge for marketing and promotion purposes of the commercial property. We also have the right to collect and inspect the tenant’s operating data. We shall provide guidance on the tenant’s operations and organise promotion activities.

• Term of service. Our commercial operational service agreements with tenants typically have an initial term of two to five years.

• Dispute resolution. Both parties are typically required to resolve any contractual disputes through negotiations first before resorting to arbitration or litigation.

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Large-scale Integrated Properties

According to CIA, large scale integrated property refers to a real estate project that contains residential properties and at least one type of non-residential properties with a GFA of more than 500,000 sq.m. that has the integrated functions such as residential and commercial consumption. As a special business combination, the large-scale integrated property has the characteristics of large scale, high density, and diversified property types. Large-scale integrated properties have the advantages of (i) scale effect that leads to cost reduction; (ii) high density that is conducive to the provision of value-added services; and (iii) synergy of diversified property types. Please refer to the section headed “Industry Overview—Large-Scale Integrated Property Management Services” in this document for further details. As at 31 December 2020, we had three large-scale integrated properties with total GFA under management of 5.1 million sq.m., making up the majority of our total GFA under management. Below sets forth our large-scale integrated properties:

Chongqing Ronghui Peninsula (重慶融匯半島)

Chongqing Ronghui Peninsula is located in Banan District, Chongqing with a total planned area of approximately 3,000 mu and a total GFA of approximately 3.0 million sq.m. The overall planning of Chongqing Ronghui Peninsula covers roads, bridges, public transportation stations, all-stage quality education system of kindergartens, primary schools and middle schools, commercial system as well as six theme leisure parks. Chongqing Ronghui Peninsula combines the riverside leisure, natural environment and harmony living style. It has a total GFA under management of 2.8 million sq.m. as at 31 December 2020. Chongqing Ronghui Peninsula was developed by Ronghui Group. It integrates a variety of property types, including residential properties, commercial properties (cultural tourism town, community commercial, shopping centre), office, parks and others.

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Chongqing Ronghui Hot Spring Town (重慶融匯溫泉城)

Chongqing Ronghui Hot Spring Town is located in the core area of Shapingba District, Chongqing with a total planned area of approximately 1,200 mu and a total GFA of approximately 2.0 million sq.m. Chongqing Ronghui Hot Spring Town includes high-quality urban resources such as the Ronghui Hot Spring Center, luxury Chongqing By-spring Villa, Ronghui Radisson Blu Hotel, Quan Fang boutique hotel, hot spring commercial town, old commercial street and a famous primary school. Chongqing Ronghui Hot Spring Town has a total GFA under management of 1.8 million sq.m. as at 31 December 2020. Chongqing Ronghui Hot Spring Town was developed by Ronghui Group. It integrates a variety of property types, including residential properties, commercial properties (cultural tourism town, community stores, shopping centre), offices, hotels and hot springs.

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Fuzhou Ronghui Hot Spring Town (福州融匯溫泉城)

Fuzhou Ronghui Hot Spring Town is located in Huanxi Town, Jin’an District, Fuzhou. It has a total planned area of approximately 9,416 mu and a total GFA of approximately 2.0 million sq.m. Fuzhou Ronghui Hot Spring Town is designed to be built into a “world-class hot spring tourism and vacation destination”, which is an important part of the strategic layout of hot spring development in the “one core and four districts” of the “Master Plan for Hot Spring Tourism Development in Fujian Province” Fuzhou Ronghui Hot Spring Town has a total GFA under management of approximately 525,717.3 sq. m. as at 31 December 2020. Fuzhou Ronghui Hot Spring Town was developed by a joint venture of Ronghui Group. It integrates a variety of property types, including residential properties, commercial properties, offices and hot springs.

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RELATIONSHIP WITH PROPERTY DEVELOPERS AND RONGHUI GROUP

Mutually Beneficial and Complementary Relationship with Ronghui Group

Our Directors are of the view that the business relationship between our Group and Ronghui Group in mutually beneficial and complementary and presents a sustainable business model for the following reasons:

(i) Our stable cooperation with and reliance on Ronghui Group are in line with industry norm and are sustainable

A majority of the property management companies with a high ranking in China are the subsidiaries or affiliates of a property development company. Such relationship is beneficial for the property management companies in obtaining a stable source of projects. Therefore, we believe our cooperation with and reliance on Ronghui Group are in line with industry norm.

In addition, we expect that the property pipeline of Ronghui Group would lay a concrete foundation for our sustainable growth. As at 31 December 2020, Ronghui Group had 58 projects located in Chongqing, Jinan, Fuzhou and Wuhu, including (i) 46 projects which have been delivered (including five partially delivered projects) with a total delivered GFA of approximately 6.3 million sq.m.; and (ii) 17 projects which have not been delivered (including five partially delivered projects) with a total undelivered GFA of 2.1 million sq.m. planned to be delivered by the end of 2023. Supported by Ronghui Group’s growth in real estate projects supply, the projects under our management increased from 43 in 2018 to 47 in 2020. The total GFA under our management under our property management services also increased from 5.7 million sq.m. in 2018 to 6.4 million sq.m. in 2020.

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(ii) Our competitive advantages over competitors resulted from our long-standing business relationship with Ronghui Group

According to CIA, high-quality service is the foundation that the property management industry and property management companies have earned recognition from customers with their high-quality services. Thus, property developers tend to select and work closely with well-resourced property management companies that have a comprehensive range of services. Our long-standing relationship and established track record of providing services to Ronghui Group has enabled us to be familiar with the standards and requirements of Ronghui Group, which has helped reduce communication costs, build mutual trust, as well as enabled us to constantly provide consistent quality property management and commercial operational services which meet the expectations and requirements of Ronghui Group. Our Directors believe that the long history of business relationship between our Group and Ronghui Group has resulted in a well-established mutual understanding between the two groups.

During the Track Record Period, our tender success rate for preliminary property management agreement for properties developed by Ronghui Group was 100%. During the Track Record Period, all of the commercial properties and a substantial majority of the residential properties developed and owned by Ronghui Group are under our management. We believe that our relatively high tender success rate for properties developed by Ronghui Group was primarily attributable to (i) our service capabilities in relation to a wide variety of property types; (ii) our history of collaboration with Ronghui Group, which has built trust in our services and reduced costs related to communication and coordination; and (iii) mutual understanding as to each other’s quality standards and business operations, enabling us to provide services tailored to the values and needs of Ronghui Group. Our high retention rate during the Track Record Period also led to Ronghui Group relying on our support to promote their brand image by continuously delivering quality property management services to property owners and residents of its developed properties.

In light of the above, our Directors consider that our relationship with Ronghui Group is mutually beneficial and complementary, and it is unlikely that the current business relationship between our Group and Ronghui Group would be materially adversely changed or terminated.

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Business expansion with Independent Third Parties

We believe our extensive industry experience enables us to adapt to the features and conditions of various properties and to meet the differentiated requirements of Independent Third Party property developers. We have been actively exploring new project engagements and potential acquisition opportunities with Independent Third Parties through various channels, such as industry referrals, participation in tender and bidding processes and cooperation with third party business partners. Since 1 January 2021 and up to the Latest Practicable Date, we had secured new engagements to provide property management services and/or commercial operational services in respect of four properties developed by Independent Third Parties as follows:

(i) On 9 April 2021, we entered into a commercial operational service agreement for tenant sourcing services to Banan Yudong Old Street (巴南魚洞老街), a property located in Chongqing developed by Independent Third Party property developer with a total GFA available for tenant sourcing of 25,756.9 sq.m.

(ii) In May 2021, we acquired 51% equity interest in Chongqing Xintianyuan from Independent Third Parties. Please refer to the section headed “History, Reorganisation and Corporate Structure—Recent Acquisition” in this document for further information. Immediately before our acquisition, Chongqing Xintianyuan had three property management projects with a total GFA under management of approximately 851,248.9 sq.m.

In early 2021, we also signed two framework agreements with Independent Third Parties for strategic cooperations in respect of preliminary development, property management and commercial operational services for three tourism projects in various parts of the PRC.

Going forward, we shall continue our efforts in increasing the scale of our services provided to projects developed by independent third-party property developers through (i) the securing of new property management engagements by participation in the tendering and bidding process for the management of such properties organised by property owners’ associations and independent third-party property developers; (ii) identifying and acquiring suitable target property management companies; and (iii) the entering into of strategic cooperation arrangements with independent third- party property developers. Our Directors are confident of our ability in expanding our portfolio of projects developed by independent third-party property developers, in particular in respect of projects developed by independent third-party property developers of relatively smaller scale which are not supported by related property management services providers. We believe such property developers would welcome property management services and/or commercial operational services from a well-established from a reputable services provider such as our Group. Accordingly, we believe that our management portfolio and revenue attributable to Independent Third Parties will continue to increase.

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Number of projects we were contracted to manage Number of projects under management Contracted GFA GFA under management From Ronghui Group and its associates and joint From From From ventures Ronghui Ronghui Ronghui Group and Group and Group and From its From its From its From Independent associates Independent associates Independent associates Independent Third and joint Third and joint Third and joint Third (1) (2) (1) (2) (1) (2) (1) (2) Percentage PartiesPercentage venturesPercentage PartiesPercentage venturesPercentage PartiesPercentage venturesPercentage PartiesPercentage (%) (%) (%) (%) ’000 sq.m. (%) ’000 sq.m. (%) ’000 sq.m. (%) ’000 sq.m. (%) Residential properties Chongqing ...... 27 90 3 10 24 88.9 3 11.1 5,122.1 85.7 851.2 14.3 4,432.0 83.9 851.2 BUSINESS (3) 16.1

Jinan, Shandong Province .... 9 100 – – 190 – – 7 100 – – 1,391.6 100 – – 947.0 100 – – Fuzhou, Fujian Province ..... 6 100 – – 6 100 – – 644.8 100 – – 561.2 100 – –

Non-residential properties Chongqing ...... 4 66.7 2 33.3 4 66.7 2 33.3 391.4 76.8 118.5 23.2 298.8 71.6 118.5 28.4 Jinan, Shandong Province .... 3 100 – – 1 100 – – 234.0 100 – – 79.5 100 – – Fuzhou, Fujian Province ..... 4 80.0 1 20.0 4 80.0 1 20.0 318.4 95.3 15.6 4.7 318.4 95.3 15.6 4.7

Total ...... 53 89.8 6 10.2 46 88.5 6 11.5 8,102.3 89.2 985.3 10.8 6,636.9 87.1 985.3 12.9

Notes:

(1) Refers to properties solely developed by Ronghui Group or jointly developed by Ronghui Group and independent third-party property developers.

(2) Refers to properties developed solely by independent third-party property developers.

(3) Among which approximately 0.4 million sq.m. was in dispute as at the Latest Practicable Date. Please refer to the section headed “Business—Legal Proceedings and Compliance—Legal Proceedings—Xintianyuan Litigation” in this document for further information. To the best of our Directors’ knowledge, in respect of the properties for which we have commenced our provisions of commercial DOCUMENT. THIS BE OF MUST COVER INFORMATION THE THE ON THAT “WARNING” AND HEADED CHANGE SECTION TO THE SUBJECT WITH AND CONJUNCTION INCOMPLETE IN FORM, READ DRAFT IN IS DOCUMENT THIS operational services as at the Latest Practicable Date, the following table sets forth (i) the type of properties; (ii) the location of properties; (iii) number of projects we were contracted to provide commercial operational services; and (iv) the contracted GFA of the properties:

Number of projects we were contracted to provide commercial operational services Contracted GFA From Ronghui From Group and Ronghui its Group and associates From its From and joint Independent associates Independent ventures Third and joint Third (1) Percentage Parties(2) Percentage ventures(1) Percentage Parties(2) Percentage (%) (%) ‘000 sq.m. (%) ‘000 sq.m. (%) BUSINESS 9 – 191 – Commercial operational services Chongqing ...... 11 91.7 1 8.3 295.6 92.0 25.8 8.0 Jinan, Shandong Province .... 1 100 – – 41.2 100 – – Fuzhou, Fujian Province ..... 1 100 – – 20.8 100 – –

Total ...... 13 92.9 1 7.1 357.6 93.3 25.8 6.7

Notes:

(1) Refers to properties solely developed by Ronghui Group or jointly developed by Ronghui Group and independent third-party property developers.

(2) Refers to properties developed solely by independent third-party property developers. 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

SMART INFORMATION SYSTEMS

We are committed to provide quality services and believe that technology can drive operational efficiency and improve user experience. We have a property management information system and a commercial operational information system to improve operational efficiency and user experience.

Property Management Information System

Our property management information system primarily consists of two intelligent platforms.

(i) Intelligent Property Management Platform. Intelligent property management platform is the core platform of our property management information system. It integrates nine modules covering basic property information, general customer services, security patrolling, equipment and facilities patrolling, income management, quality control, inventory management, system management and financial reporting. We have a mobile application based on our intelligent property management platform for our staff, which integrates the functions such as customer reporting, task allocation, security patrolling, equipment and facilities patrolling and quality control. It allows our staff to have access to our core intelligent property management functions on-site, which significantly increases their efficiency. Based on our intelligent property management platform, we have also implemented an intelligent community facilities management system, which connects certain of our property management facilities and equipment with our intelligent property management platform. It provides intelligent functions such as intelligent car park management, intelligent entrance management and equipment and facilities online monitoring.

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Commercial Operational Information System

We have an internal commercial operational management platform that enables the recording of data collected from our services, covering tenant sourcing, agreement signing, merchant entry, merchant operations, merchant withdrawal and financial settlement. It establishes a commercial database and combines the commercial data from services we provide to formulate standardised commercial operational procedures. By fully utilising the commercial operational management platform, we are able to increase average GFA under management per staff, reduce staff costs and offline communication costs, enhance the accuracy and time-effectiveness of data as well as improve the efficiency of our management in decision making, thus achieving more cost-efficient commercial operational services.

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 23 September 2000 and was revised on 8 January 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 services. Commercial Internet information services refer to paid services of providing information to or creating web pages for web users through the internet. Non-commercial internet information services refer to free services of providing public, commonly shared information to web users through the internet. Entities engaging in providing commercial internet information services shall apply for a licence 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.

We completed the ICP filing for Xiaohui Dangjia App. As advised by our PRC Legal Advisors, our services provided through Xiaohui Dangjia smart community service platform do not constitute commercial internet information services and we are not required to obtain an ICP licence.

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 showed the terms and conditions to customers and have also gained their prior consent before collecting their data.

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SALES AND MARKETING

Our market development department at our headquarters level is primarily responsible for creating and implementing our marketing strategy, conducting market research and organising our sales and marketing events. We have also established regional market development teams at subsidiary or branch level to take charge of the sales and marketing in their respective regions. Our market development department and regional market development teams also maintain active communication with professional industry institutions and takes initiative to participate in industry events to learn from the advanced marketing strategy in the industry and expand our promotion channels. Our market development department is also responsible for preparing for and participating in tenders to obtain new contracts with third-party property developers and maintain and strengthen our relationships with existing customers.

CUSTOMERS

Our customer base primarily consists of property owners, residents, tenants and property developers. The table below sets forth the main types of our major customers for each of our business lines.

Business lines Major customers

Property Management Services

General property management Property developers, property owners services

Value-added services to Property developers non-property owners

Community value-added Property developers, property owners and residents services

Commercial Operational Services

Commercial operational Tenants services to tenants

Commercial operational Property developers and property owners services to property developers and property owners

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In 2018, 2019 and 2020, revenue from our five largest customers amounted to RMB42.6 million, RMB48.8 million and RMB65.5 million, respectively, which accounted for approximately 21.4%, 21.7% and 27.1%, respectively, of our total revenue. During the same periods, revenue from our largest customer Ronghui Group and its related parties amounted to RMB37.4 million, RMB42.8 million and RMB60.9 million, respectively, which accounted for approximately 18.8%, 19.1% and 25.2%, respectively, of our total revenue. Please refer to the section headed “Connected Transactions—(B) Continuing Connected Transactions subject to the Reporting Annual Review, Announcement, Circular and Independent Shareholders’ Approval Requirement” in this document. We have established ongoing business relationships and cooperation with our largest customer during the Track Record Period, Ronghui Group, for more than 15 years. We accept payments through bank transfers.

The following tables set out certain details of our five largest customers for the Track Record Period:

2020

Length of business Customer relationship Percentage of Relationship Rank Customer Type with us Services provided by us Revenue total revenue with us Credit term Year RMB’000 % day

1. . . Ronghui Group and Property 15 Property management 60,931 25.2 Related party 30 to 90 its related parties developer services and commercial operational services

2. . . Company A Tenant 5 General property 1,232 0.5 Independent Prepayment management services Third Party and commercial operational services to tenants

3. . . China Tower Tenant 6 Common area 1,134 0.5 Independent Prepayment Corporation Limited value-added services Third Party (中國鐵塔股份有限 (common area leasing) 公司)

4. . . Chongqing Jingkun Catering Tenant 6 General property 1,133 0.5 Independent Property management Management Company management services Third Party services: 30 Limited and commercial Commercial (重慶景堃餐飲管理 operational services to operational services: 有限公司) tenants prepayment

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Length of business Customer relationship Percentage of Relationship Rank Customer Type with us Services provided by us Revenue total revenue with us Credit term Year RMB’000 % day

5. . . Chongqing Lizehui Hotel Tenant 7 Commercial operational 1,072 0.4 Independent Prepayment Management Company services to tenants Third Party Limited (重慶麗澤滙酒店管理有限公司)

2019

Length of business Customer relationship Percentage of Relationship Rank Customer Type with us Services provided by us Revenue total revenue with us Credit term Year RMB’000 % day

1. . . Ronghui Group and Property 15 Property management 42,832 19.1 Related party 30 to 90 its related parties developer services and commercial operational services

2. . . Company B Advertiser 7 Common area 1,821 0.8 Independent Prepayment value-added services Third Party (advertising space leasing)

3. . . Chongqing Rongsheng Film Tenant 7 General property 1,551 0.7 Independent Property management Company Limited management services Third Party services: 90 (重慶融昇影業有限 and commercial Commercial 公司) operational services to operational services: tenants prepayment

4. . . China Tower Tenant 6 Common area 1,342 0.6 Independent Prepayment Corporation Limited value-added services Third Party (中國鐵塔股份有限 (common area leasing) 公司)

5. . . Company A Tenant 5 General property 1,224 0.5 Independent Prepayment management services Third Party and commercial operational services to tenants

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2018

Length of business Customer relationship Percentage of Relationship Rank Customer Type with us Services provided by us Revenue total revenue with us Credit term Year RMB’000 % day

1. . . Ronghui Group and Property 15 Property management 37,425 18.8 Related party 30 to 90 its related parties developer services and commercial operational services

2. . . Chongqing Rongsheng Film Tenant 7 General property 1,540 0.8 Independent Property management Company Limited management services Third Party services: 90 (重慶融昇影業有限 and commercial Commercial 公司) operational services to operational services: tenants prepayment

3. . . Company B Advertiser 7 Common area 1,292 0.7 Independent Prepayment value-added services Third Party (advertising space leasing)

4. . . Company A Tenant 5 General property 1,257 0.6 Independent Prepayment management services Third Party and commercial operational services to tenants

5. . . Chongqing Ximansheng Tenant 6 General property 1,037 0.5 Independent Property management Catering Culture management services Third Party services: 30 Company Limited and commercial Commercial (重慶喜滿生餐飲文化 operational services to operational services: 有限公司) tenants prepayment

As at the Latest Practicable Date, save and except for Ronghui Group and its related parties, none of our Directors, their close associates or any Shareholders who, to the best knowledge of our Directors, owns more than 5% of our issued share capital had any interest in any of our five largest customers.

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Major Customers

During the Track Record Period, our major customers, Ronghui Group and its related parties also supplied us with (i) gardening and cleaning services; (ii) materials for marketing and employees benefit; (iii) utilities; and (iv) venues during the Track Record Period.

Negotiations of the terms of our sales to and purchases from these customers were conducted on an individual basis by different personnel and the sales and purchases were neither inter-connected or inter-conditional with each other. Our Directors confirmed that all of our sales to and purchases from overlapping customers and suppliers were conducted in the ordinary course of business under normal commercial terms and on an arm’s length basis. Our Directors believe that the established long-term business relationship with Ronghui Group is mutually beneficial to both Ronghui Group and us, and is in the interest of our Company and the Shareholders as a whole. The revenue from our major customer Ronghui Group and its related parties as a percentage of our total revenue was 18.8%, 19.1% and 25.2% in 2018, 2019 and 2020, respectively. The purchasing costs from these overlapping suppliers as a percentage of our total purchases was 2.9%, 1.0% and 0.9% in 2018, 2019 and 2020, respectively.

The table below sets forth the amount of our revenue and total purchase involved with respect transactions entered into with Ronghui Group and its related parties.

For the Year ended 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Ronghui Group and its related parties Amount of our Group’s revenue involved as a customer ...... 37,425 42,832 60,931 Amount of our Group’s total purchase involved as a supplier ...... (4,433) (1,661) (1,411) – Gardening and cleaning services . . . (2,910) (965) (798) – Materials for marketing and employees benefit ...... (363) (374) (520) – Utility expense ...... (499) – – – Lease expense ...... (661) (322) (93)

Please refer to Note 27 of the Accountants’ Report as set out in Appendix I to this document for further details.

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SUPPLIERS

The following tables set out details of our five largest suppliers for the Track Record Period:

2020 Length of business Percentage relationship Products/ services Purchase of total Relationship Credit Rank Supplier Supplier Type with us provided to us amount purchase with us term Year RMB’000 % day

1. . . State Grid Corporation Utility supplier 15 Electricity 6,278 3.8 Independent 30 of China Third Party (國家電網有限公司)

2. . . Chongqing Cleaning service 3 Cleaning services 4,312 2.6 Independent 60 Youyuan Cleaning subcontractor Third Party Company Limited (重慶優源清潔服務有限公司)

3. . . Guangzhou Shengming Cleaning service 4 Cleaning services 2,880 1.7 Independent 60 Property Management subcontractor Third Party Company Limited Chongqing Branch (廣州市勝銘物業管理有限公司重慶分公司)

4. . . Chongqing Hua’er Cleaning service 11 Cleaning services 2,748 1.7 Independent 60 Cleaning Service subcontractor Third Party Company Limited (重慶華爾環境綜合服務產業有限公司)

5. . . Chongqing Guangyu Cleaning service 6 Cleaning services 2,397 1.4 Independent 60 Cleaning Service subcontractor Third Party Company Limited First Branch (重慶市光宇清潔服務有限公司第一分公司)

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2019

Length of business Percentage relationship Products/ services Purchase of total Relationship Credit Rank Supplier Supplier Type with us provided to us amount purchase with us term Year RMB’000 % day

1. . . State Grid Corporation Utility supplier 15 Electricity 7,066 4.2 Independent 30 of China Third Party (國家電網有限公司)

2. . . Guangzhou Shengming Cleaning service 4 Cleaning services 3,105 1.9 Independent 60 Property Management subcontractor Third Party Company Limited Chongqing Branch (廣州市勝銘物業管理有限公司重慶分公司)

3. . . Chongqing Cleaning service 3 Cleaning services 2,791 1.7 Independent 60 Youyuan Cleaning subcontractor Third Party Company Limited (重慶優源清潔服務有限公司)

4. . . Chongqing Hua’er Cleaning service 11 Cleaning services 2,791 1.7 Independent 60 Cleaning Service subcontractor Third Party Company Limited (重慶華爾環境綜合服務產業有限公司)

5. . . Chongqing Guangyu Cleaning service 6 Cleaning services 2,123 1.3 Independent 60 Cleaning Service subcontractor Third Party Company Limited First Branch (重慶市光宇清潔服務有限公司第一分公司)

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2018

1. . . State Grid Corporation of Utility supplier 15 Electricity 6,589 4.3 Independent 30 China (國家電網有限公 Third Party 司)

2. . . Ronghui Group and Property developer 15 (i) gardening and 4,433 2.9 Related party 30-90 its related parties(1) cleaning services; (ii) materials for marketing and employees benefit; (iii) utilities; and (iv) venues

3. . . Guangzhou Shengming Cleaning service 4 Cleaning services 4,163 2.7 Independent 60 Property Management subcontractor Third Party Company Limited Chongqing Branch (廣州市勝銘物業管理有限公司重慶分公司)

4. . . Chongqing Hua’er Cleaning service 11 Cleaning services 1,738 1.1 Independent 60 Cleaning Service subcontractor Third Party Company Limited (重慶華爾環境綜合服務產業有限公司)

5. . . Chongqing Guangyu Cleaning service 6 Cleaning services 1,302 0.9 Independent 60 Cleaning Service subcontractor Third Party Company Limited First Branch (重慶市光宇清潔服務有限公司第一分公司)

Notes:

(1) Ronghui Group and its related parties provided (i) gardening and cleaning services; (ii) materials for marketing and employees benefit; (iii) utilities; and (iv) venues to us in 2018 and became one of our top five suppliers in 2018. Ronghui Group and its related parties was also our single largest customer during the Track Record Period.

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During the Track Record Period, we did not experience any material delay, supply shortages or disruptions in our operations relating our suppliers, or any material product claims attributable to our suppliers. As at the Latest Practicable Date, save and except for Ronghui Group and its related parties, none of our Directors, their close associates or any Shareholders who, to the best knowledge of our Directors, owned more than 5% of our issued share capital had any interest in any of our five largest suppliers. 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 after negotiations. Payments to suppliers are typically settled by month via bank transfers.

SUBCONTRACTING

We outsource certain labour-intensive services and specialised services, primarily including cleaning, gardening, garbage disposal, security and repair and maintenance services, to subcontractors, which enables us to reduce our operating and labour costs, improve service quality and dedicate more resources to management and other value-added services. We believe such subcontracting arrangements allow us to leverage the human resources and technical expertise of the third-party subcontractors, manage the risks in relation to labour and enhance the overall profitability of our operations. In 2018, 2019 and 2020, subcontracting costs amounted to RMB26.9 million, RMB32.5 million and RMB34.6 million, respectively, which accounted for approximately 17.7%, 19.5% and 20.9%, respectively, of our total cost of sales for the relevant period.

As at the Latest Practicable Date, save and except for Ronghui Group and its related parties, none of our Directors, their close associates or any Shareholders which, to the best knowledge of our Directors, owned more than 5% of our share capital had any interest in any of our five largest subcontractors.

Selection and Management of Subcontractors

We aim to create and maintain an effective and comprehensive system for subcontractor management. We constantly monitor and evaluate the subcontractors on their ability to meet our requirements. To ensure the overall quality of our subcontractors, we maintain a list of subcontractors based on our series of assessment standards, including, among others, the amount of registered capital, length of existence, size of overall operations, technical capability, industry credentials, price and past cooperation with us. After initial evaluation of subcontractors, we also regularly review the performance of subcontractors and disqualify subcontractors that do not meet our requirements from the list. We only accept bidding from the subcontractors on the list for subcontracting jobs.

Key Terms of Our Subcontracting Agreement

A typical subcontracting agreement entered into between subcontractors and us generally includes the following key terms:

• Term. A subcontracting agreement typically has a term of approximately one to three years and may be renewed upon mutual consent.

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• Our responsibilities. We are typically responsible for providing onsite personnel dispatched by the subcontractor with necessary working space and utilities. We are also responsible for supervising and providing feedback on the work performed by the personnel dispatched by the subcontractor.

• Obligations of the subcontractor. 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 substandard performance, the subcontractor is required to take necessary rectification measures within the period required by us, failing which we have the right to claim damages and penalties, or terminate the contract. The subcontractor is required to manage its personnel providing the contracted services and there is no employment relationship between us and the personnel of the subcontractor.

• Risk allocation. The subcontractor is responsible for any damages to property or personal injuries caused by the fault of the subcontractor in the course of providing the contracted services. We typically require the subcontractor to indemnify us for any damages that it causes to the properties of the residents and us. The subcontractor is also required to pay all social insurance and housing provident funds contributions for its personnel in accordance with PRC laws and regulations and bear the liabilities and responsibilities in the event of any non-compliance.

• Tools, equipment and raw materials. Tools, equipment and raw materials are to be prepared or procured by the subcontractor. The procurement costs are usually included in the subcontracting fee.

• Subcontracting fee. Subcontracting fee is typically payable monthly or quarterly, including costs incurred in connection with the procurement of tools and raw materials, labour costs, equipment maintenance costs, tax expenses and other miscellaneous costs incurred by the subcontractor.

• Anti-bribery. We and our employees are forbidden from requesting bribes from the subcontractor in any forms, and the subcontractor is forbidden from offering any financial assistance or other forms of bribes to our employees. We reserve the right to pursue legal actions if subcontractor’s breach of its anti-bribery obligations causes damages to us.

• Termination. The agreement is terminated when the term of the contract expires. We may also terminate the agreement if the subcontractor provides substandard performances for multiple times. We may also terminate the agreement if the subcontractor breaches provisions regarding anti-bribery or other material terms of the agreement.

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EFFECT OF THE COVID-19 PANDEMIC

An outbreak of respiratory illness caused by a novel coronavirus, namely COVID-19, was reported in December 2019 and subsequently evolved into a global pandemic. 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.

Effects of the COVID-19 Pandemic on Our Business Operations

According to CIA, the probability of the property management industry being affected by the pandemic and thereby leading to situations such as suspension of operations or termination of services, experiencing troubles with supply of raw materials, reduction of property management fees to arise is extremely low. However, the COVID-19 pandemic had a certain level of short term impact on the property management industry, mainly in relation to costs and management. In particular, our following services have experienced certain short-term impact as a result of the COVID-19 pandemic.

• Sales centre management services. Certain of the sales offices and show flats we managed suspended operations after the outbreak of the COVID-19 pandemic as a result of government requirements, decrease in demand, and changes in property developers’ business plans. In 2020, three projects were delayed due to the COVID-19 pandemic while we did not record any significant loss due to such delay as we also postponed our personnel deployment accordingly. These projects have been delivered in 2020.

• Common area value-added services. During the COVID-19 pandemic, due to the measures on combatting the COVID-19 pandemic in properties under our management, our ability to rent out community spaces was negatively affected.

• Commercial operational services. The COVID-19 pandemic has a relatively direct impact on the commercial properties operated by us from the aspects such as tenant sourcing, commercial operational service fee collection rate and whether the commercial property is allowed to open. However, through our smart technology platform, we integrate the online and offline business of the merchants of the commercial properties operated by us to support their continuous operations.

Since the outbreak of the COVID-19 pandemic and up to the Latest Practicable Date, we had not encountered any material disruption to the services provided by our third-party subcontractors and utilities service providers and the supply of materials from our suppliers. Our Directors consider that while the supply chains in all industries will be affected to a certain extent by any pandemic similar to that of COVID-19, particularly due to the prolonged suspension of business operations and the instability of a workforce arising from any potential mandatory quarantine requirements, in view of the nature of our business, our Directors do not

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We were informed by Ronghui Group that it anticipated certain delay in certain projects as a result of the business suspension imposed by the PRC Government in curbing the COVID-19 pandemic. However, after consulting Ronghui Group and other property owners or developers, we do not anticipate there will be any material delay in sales, construction and delivery of the properties developed by Ronghui Group, joint ventures and associates of Ronghui Group and independent third-party property developers for our management as scheduled. We believe such delay will unlikely have material adverse impact on our financial condition.

In the long term, however, the COVID-19 pandemic is expected to bring about positive changes to the property management industry. During the fight against the COVID-19 pandemic, property management companies drew the attention of the government and the communities. We believe our efforts to control the outbreak has earned us higher degrees of trust and reliance from property owners and residents at properties under our management. We believe the measures on combatting the COVID-19 pandemic imposed in many regions have also led to residents’ increasing reliance on community value-added services to address their daily living needs. We believe this presents us with significant opportunities to expand our related service offerings. Based on the above, our Directors are of the view that no material adverse effect on our operations and financial performance is expected to result from the recent COVID-19 pandemic.

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, whether due to government policy or any other reasons beyond our control, due to the COVID-19 outbreak, we estimate our existing financial resources (including cash and bank balances and amounts due from related parties to be repaid before [REDACTED]) as at 31 December 2020 could satisfy our necessary costs for over 12 months. Our key assumptions of the worst case scenario where our business is forced to be suspended due to the impact of COVID-19 include: (i) we can only maintain and generate revenue from property management services, which are less affected by the COVID-19 pandemic; (ii) all of our staff, including operational and administrative staff, are encouraged to take unpaid leave under mutual consent or dismissed upon proper notice in accordance with the employment contract and no significant compensation is incurred; (iii) we may incur one-month staff cost to dismiss front line staff assuming no mutual consent to take unpaid leave is obtained from them; (iv) the rental related payments including rentals, management fees and other miscellaneous charges will be paid on time; (v) minimal operating and administrative expenses will be incurred to maintain our operations at a minimum level (including basic head office maintenance cost, utilities expenses, fees to be incurred as a [REDACTED] company such as annual [REDACTED], annual audit fee, financial reports and compliance adviser fee); (vi) the expansion plan is delayed under such condition; (vii) there will be no further internal or external financing from Shareholders or financial institutions; and (viii) no further dividend will be declared and paid under such situation.

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The abovementioned extreme situation may or may not occur. 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 a possibility 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 to the COVID-19 Pandemic

In response to the COVID-19 pandemic, we have adopted the following hygiene and precautionary measures across the properties under our management since late January 2020.

• Disinfection. We spray disinfectants in public facilities, building corridors, elevators and other public spaces under our management.

• Garbage disposal. We designate specialised collection and disposal sites for used masks and other potentially hazardous materials.

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The additional costs for implementing these enhanced measures, after taking into account the medical and cleaning supplies distributed by local governments, was RMB0.5 million for the year ending 31 December 2020. This mainly represents the material costs for masks, ethanol hand wash, disinfectants, infrared thermometers, etc. Our Directors confirm that the additional costs associated with the enhanced measures had no significant impact on our Group’s financial position for the year ending 31 December 2020.

Effects of the COVID-19 Pandemic on Our Business Strategies

According to CIA, the COVID-19 pandemic has caused short-term financial and management pressure to property management company, but it is expected that COVID-19 pandemic would also bring about positive changes to the property management industry as, among others, the COVID-19 pandemic creates demand for new value-added services and the relevant authorities may implement policies favourable to property management companies to combat the COVID-19 pandemic. We therefore believe that our expansion plan as discussed in the paragraph headed “—Our Strategies” above is feasible, and we currently expect that it is unlikely that we would change the use of the [REDACTED] received by our Company from the [REDACTED] as disclosed in the section headed “Future Plans and [REDACTED]” in this document as a result of the COVID-19 pandemic.

Smart Community

Our efforts in building a smart community also helped us in mitigating the impact of COVID-19 pandemic. We have established our smart property management platform based on facilities and equipment online monitoring system, centralised surveillance system, integrated command centre, smart community service platform represented by Xiaohui Dangjia APP, and self-service car parks. The smart community can reduce human contact and improve management efficiency, which provided us advantage in implement social distancing and strengthened entrance control in the COVID-19 pandemic. We plan to further improve our service quality and operational efficiency through construction of smart management system and enhancement of our core competitiveness of technology empowerment. Please refer to the paragraph headed “—Our Strategies—Improve our service quality and operational efficiency through upgrades and optimisation of our information management systems and platforms” above and the section headed “Future Plans and [REDACTED]” in this document for further details.

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QUALITY CONTROL

We believe quality control is crucial to the long-term success of our business. We have a series of quality control policies which primarily cover maintaining service standards, standardising service procedures and monitoring service quality throughout our operational processes.

Quality Control over Property Management Services and Commercial Operational Services

In order to ensure our service quality and consumer satisfaction, we conduct reviews on consumer satisfaction at all properties under our management on a quarterly or semi-annually basis. The quality check and consumer satisfaction results are factored into the performance review of project companies and regional companies. For our property management services, the average customer satisfaction rates were 80.4%, 85.9% and 86.6% in 2018, 2019 and 2020, respectively. For our commercial operational services, the average satisfaction rates were 82.1%, 82.5% and 92.0% in 2018, 2019 and 2020, respectively. We have established well-developed and standardised quality control systems and we have obtained, among others, the ISO 9001:2015 quality management system certification, the ISO 14001:2015 environment management system certification and the ISO 45001:2018 occupation health and safety management system certification. For properties of different types and sizes, we followed the above quality management systems and implemented effective management through planning, management target setting and assessment, and formulate specific management procedures and assessment standards for our services and established a full life cycle service quality system from planning stage to delivery.

Quality Control over Subcontractors

We typically include in the agreements with subcontractors detailed quality standards 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 also conduct periodic performance assessment of our subcontractors and we have the contractual right to deduct the subcontracting fees if the score of such performance assessment is below a certain level. We also have the contractual right to terminate the agreement immediately if we receive a certain number of genuine complaints from our customers regarding such subcontractor. Please refer to the paragraph headed “—Subcontracting—Selection and Management of Subcontractors” above.

Quality Control over Third-party Vendors

We implement various measures and policies to ensure the quality of the products and services offered by third-party vendors, such as screening candidate vendors by examining their qualifications and conducting onsite inspection of their business premises, before entering into cooperation agreements with them. We also conduct annual assessment on our vendors in respect of service quality and after-sales services. We also have the right to replace or return of the goods at the cost of a third-party vendor if such goods are not able to meet our requirements.

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Feedback and Complaint Management

During the ordinary course of our business, we receive feedback, suggestions and complaints (such as report of loss of properties and request for repair of public facilities) from property owners and residents of the properties we manage from time to time regarding our services. We have established internal procedures to record, process and respond to the feedback, suggestions and complaints and conduct follow-up reviews of the results of our responses.

We collect and analyse our customers’ feedback on our service to improve our service quality. We have designated customer service personnel responding to customer’s feedback or complaint 24 hours daily. Further, we also adopt standardised procedures to manage customers’ complaints. Our customer service personnel are required to respond to the customers’ first complaints within 30 minutes. Customers’ reports and request for repair must be responded with 30 minutes and the customer shall be told the outcome of the on-site inspection, handling opinions and measures and the estimated completion times. For emergency incidents, our personnel need to arrive at the scene and attend to the situation within 10 minutes. All reports and requests for repair shall be closed according to the scheduled timeline and registration and return visits shall be made.

During the Track Record Period, 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 consider our intellectual property rights as critical to our success. We primarily rely on laws and regulations on trademarks and trade secrets and our employees’ and third parties’ contractual commitments to confidentiality and non-competition to protect our intellectual property rights. As at the Latest Practicable Date, we had obtained one registered trademark, two copyrights and two domain names in the PRC, among which one software copyright and one domain name are for our Xiaohui Dangjia mobile application. We are also currently applying for one trademark in Hong Kong, three trademarks in the PRC and one copyright in the PRC.

As at 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.

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AWARDS

The following table sets forth a selection of the notable awards and accreditations we received during the Track Record Period.

Awarded Entity or Awarding Year Award/Recognition Property Awarding Entity

2020 ...... Most Beautiful Ronghui Xiliutuo Chongqing Tourism Cultural Tourism Town Association Town, Best Food Town, Most Livable Town and Internet Popularity Award

2020 ...... 2020 China Property Chongqing Ronghui CIA Service Featured Property Brand Enterprise Management

2020 ...... 2020 Outstanding Chongqing Ronghui CIA Brand for Property Commercial Management Property Service in China

2020 ...... 2020 Leading Brand Chongqing Ronghui CIA of Property Property Services in Management Southwest China

2019 ...... China Enterprise Chongqing Ronghui China Enterprise Credit Rating Property Evaluation Certificate (AAA) Management Association

2019 ...... 2019 Top 100 Chongqing Ronghui CIA Property Property Management Management Companies in China

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Awarded Entity or Awarding Year Award/Recognition Property Awarding Entity

2019 ...... 2019 Top 50 Chongqing Ronghui CIA Property Property Management Management Companies in Southwest China

2019 ...... 2019 Chongqing Chongqing Ronghui CIA Leading Property Enterprise in Management Property Service Quality

2018 ...... National AAA Ronghui Jinan Old Jinan Tourism Tourism Area Commercial Port Development Committee

2018 ...... 2018 Top 100 Chongqing Ronghui CIA Property Property Management Management Companies in China

COMPETITION

According to CIA, the PRC property management industry is highly fragmented, with approximately 200,000 property management service providers operating in the industry in 2020. 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. In addition, the commercial operational market is relatively fragmented. For more information on the industry and the markets that we operate in, please refer to the sections headed “Industry Overview” and “Risk Factors—Risks Relating to Our Business and Industry—we face a wide range of competition and may fail to compete effectively and operate profitably” in this document.

SOCIAL, HEALTH, SAFETY AND ENVIRONMENTAL MATTERS

We are subject to PRC laws in relation to labour, safety and environment protection matters. In addition, we have established occupational safety and sanitation systems and provided employees with workplace safety trainings to increase their awareness of work safety issues. We also assign security personnel and provide 24-hour safely and security patrol at each of properties under our management to help promote the safety and security of the property owners and residents. During the Track Record Period and as of the Latest Practicable Date, we did not experience any material accidents involving personal injury or property damage which have materially and adversely affected our operations.

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We hire employees based on their merits and it is our corporate policy to offer equal opportunities to our employees regardless of gender, age, race, religion or any other social or personal characteristics. During the Track Record Period and up to the Latest Practicable Date, we had complied with PRC laws 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 protection of the environment to be important. 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 had not been subject to any material administrative penalties due to violation of environmental laws in China.

EMPLOYEES

We believe that our quality personnel is our key to success and future development. We endeavour to recruit quality personnel and provide them with quality training. We recruit talent from various sources, such as educational institutions third-party recruitment agency and other companies, and provide on-going training and promotion opportunities to our staff members. As at 31 December 2020, we had a total of 1,653 full-time employees. The following table sets forth the number and breakdown of our full-time employees by function as at 31 December 2020. Number of % of our total Function employees employees

Management ...... 12 0.7 Administration ...... 12 0.7 Human resources ...... 14 0.8 Financial management ...... 19 1.2 Quality Control ...... 12 0.7 Marketing ...... 7 0.4 Logistics ...... 11 0.7 Property management service personnel ...... 1,515 91.7 Commercial Operational service personnel ...... 51 3.1

Total ...... 1,653 100.0

During the Track Record Period and up to the Latest Practicable Date, our employees did not negotiate their terms of employment through any labour union or by way of collective bargaining agreements nor did we experience any material labour disputes or shortages that may have a material adverse effect on our business, financial position and results of operations.

Recruiting

We rely on high quality personnel for our consistent delivery of high quality service. We endeavour to hire the best talented employees in the market by offering competitive wages, bonus, benefits, systematic training opportunities and internal upward mobility. During our recruiting process, we seek talent that is best suited to our vacancy by sourcing through a broad range of channels, including online advertisements, third-party recruiting agencies and employee referrals. We recruit our employees based on a number of factors, including their educational background, relevant work experience, communication skills, teamwork spirit and our needs due to vacancies.

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Training

We provide various systematic and periodic training programmes to our employees. Our employee training programmes primarily cover key areas in our business operations, which provide continuous training to our existing employees at different levels to specialise and strengthen their skill sets.

OUR CASH MANAGEMENT POLICY

We have a bank account and cash management system to manage our cash inflows and outflows, applicable to all of our subsidiaries and branch offices in their ordinary course of business. Generally, we encourage our subsidiaries and branch offices to settle transactions through bank transfers to lower the risks relating to managing cash. Our employees are required to deposit cash received into the relevant bank accounts in the day of receipt.

Cash handling policies and Cash handling policies and internal internal control measures control measures

Receipt of cash income or We require our subsidiaries and branches to individual repayment deposit cash received in their bank accounts within the same day. We also require our subsidiaries to check and report the bank account balances on a daily basis.

Expenses We only allow our subsidiaries and branches to pay certain expenses in cash, such as employee allowances, labour insurance and benefits, travel expense, and small amount business supply expenses. Other expenses must be paid via bank transfer in accordance applicable laws or regulations. We also prohibit our subsidiaries and branches from pay expenses using their cash income.

Cash inventory and deposits We requires our subsidiary and branches to maintain limited cash inventory, and at least count their respective cash inventory once in a month. If any discrepancy is identified, such incident should be reported for further handling.

Opening of and managing bank We require our subsidiaries and branches to open accounts of our subsidiaries and and close their bank accounts in accordance with offices their respective authorisation procedures. We also prohibit our subsidiaries and branches from lending or renting their bank accounts.

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INSURANCE

We maintain insurance policies against major risks and liabilities arising from our business operations, primarily (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 require our subcontractors to purchase accident insurance for their employees who provide services to our Group, and in accordance with our standard terms in the agreements between subcontractors and us, the subcontractors are responsible for all workplace injuries to their employees.

We believe that our insurance coverage is in line with the industry practice 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. For more details, please refer to the section headed “Risk Factors—Risks Relating to Our Business and Industry—Our insurance coverage may not sufficiently cover the risks related to our business” in this document.

CERTIFICATES, LICENCES AND PERMITS

We are required to obtain and maintain various certificates, licences and permits in relation to our operations. As advised by our PRC Legal Advisors, we obtained all material certificates, licences and permits from relevant regulatory authorities necessary for our main business lines as at the Latest Practicable Date. We are required to renew such certificates, licences and permits from time to time. We do not expect that we will face any difficulties in renewing our certificates, licences and permits.

PROPERTIES

As at the Latest Practicable Date, we had one owned property in Chongqing with a GFA of approximately 49.7 sq.m. for use as office. As at the Latest Practicable Date, we also leased 10 properties in various locations in the PRC with an aggregated GFA of approximately 2,957.1 sq.m. for use primarily as office spaces, commercial properties and employee dormitories.

As at the Latest Practicable Date, we leased five properties in the PRC with an aggregated GFA of approximately 1,463.1 sq.m. for use as office spaces or employee dormitory, which we had not filed the lease agreement for such leased property with the local housing administration authorities as required under PRC law. Under PRC laws and regulations, we might be ordered to rectify this non-compliance by competent authorities and if we fail to rectify within a prescribed period, a penalty of RMB1,000 to RMB10,000 for each agreement may be imposed on us as a result of such non-filing. As at 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 file the lease agreements described above. Our PRC Legal Advisor has advised us that the failure to file the lease agreements would not affect the validity of the lease agreements. Our Directors are of the view that the lack of such filing would not have a material adverse effect on our business operations or constitute a material legal obstacle for the [REDACTED]. Please refer to the section headed “Risk Factors—Risks Relating to our Business and Industry— Our rights to use our leased properties could be challenged by third

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We had no single property with a carrying amount of 15% or more of our total assets as at the Latest Practicable Date and, therefore, we did not need to prepare a valuation report with respect to our property interests in reliance upon the exemption provided by section 6(2) of the Companies (Exemption of Companies and Prospectuses from Compliance with Provisions) Notice (Chapter 32L of the Laws of Hong Kong).

RISK MANAGEMENT AND INTERNAL CONTROL

We have implemented various risk management policies and measures to identify, assess and manage 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, please refer to the section headed “Risk Factors—Risks Relating to our Business and Industry” in this document. In addition, we face various financial risks, including interest rate, price, credit and liquidity risks that arise during our ordinary course of business. Please refer to the section headed “Financial Information—Quantitative and Qualitative Disclosures about Financial Risks” in this document.

Our Directors are responsible for reviewing and approving the internal control policies and monitoring its implementation while our senior management is responsible for establishing specific internal control policy and ensuring that they are effectively carried out. In order to continuously improve our corporate governance, we have adopted or expect to adopt the following policies and procedures for internal control and risk management:

(a) we will engage PRC and Hong Kong legal advisers to provide legal advice to us in relation to future compliance with the PRC and Hong Kong laws and regulations in all respects.

(b) we have appointed CEB International Capital Corporation Limited as our compliance adviser upon [REDACTED] to advise our Group on compliance matters in accordance with the Listing Rules;

(c) we will provide our Directors, senior management and employees involved with training and/or updates regarding the legal and regulatory requirements applicable to the business operations of our Group from time to time;

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(d) when necessary, we will engage external professional, including auditors, internal control consultants, and external legal advisers to render professional advice as to comply with statutory and regulatory requirements as applicable to us from time to time;

(e) we will from time to time remind our employees of their obligations to contribute to their part of the social insurance and housing provident funds in order to comply with the applicable PRC laws and regulations, and advise them on the procedures for making such contributions;

(f) on [●] 2021, we established the Audit Committee which will implement formal and transparent arrangements to apply financial reporting and internal control principles in accounting and financial matters to ensure compliance with the Listing Rules and other relevant laws and regulations, including timely preparation and filing of accounts. We will also periodically review our compliance status with the Hong Kong laws after the [REDACTED]. The Audit Committee will exercise its oversight by:

(i) reviewing our internal control and legal compliance; and

(ii) discussing the status of our internal control systems with our management to ensure that our management has performed its duty to maintain an effective internal control system.

We engaged an internal control consultant in January 2021 to perform an internal control review (the “IC Review”) of our internal control system based on agreed scope, including revenue, purchase, fixed assets management, human resources, financial management, information technology and corporate governance. The internal control consultant is a professional firm specialising in providing corporate governance, internal audit and internal control review services to new [REDACTED] applicants and [REDACTED] companies. During the IC Review, the internal control consultant identified a number of findings, pursuant to which we have enhanced internal control measures recommended by the internal control consultant. The internal control consultant subsequently performed a follow-up review in May 2021 on our internal control system with regard to those remediation measures taken by us. We have not received any further recommendations or findings from the Internal Control Consultant.

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LEGAL PROCEEDINGS AND COMPLIANCE

Legal Proceedings

Xintianyuan Litigation

As at the Latest Practicable Date, we were involved in a legal proceeding which render certain of our GFA under management as at the Latest Practicable Date in dispute, details of which is set out below:

Since December 2009, pursuant to the preliminary property management service contracts (as renewed) (the “Property Management Contracts”) entered into between Chongqing Xintianyuan (one of our subsidiaries) and the property developer of Zongshen Dongli City (宗申動力城) in Banan District, Chongqing (“Zongshen Dongli City”), Chongqing Xintianyuan has been providing property management services to Zongshen Dongli City. As at the Latest Practicable Date, Chongqing Xintianyuan provided property management services to Zongshen Dongli City with an aggregate GFA under management of approximately 0.4 million sq.m., representing approximately 5.5% of our total GFA under management as at the Latest Practicable Date. In 2020, the revenue generated from the property management services provided by Chongqing Xintianyuan to Zongshen Dongli City pursuant to the Property Management Contracts amounted to RMB7.2 million, representing approximately 3.0% of our total revenue during the same period.

In September 2020, the third property owners’ association of Zongshen Dongli City (the “Third Property Owners’ Association”) was established. On 24 March 2021, the Third Property Owners’ Association published the poll results of the first general meeting of the property owners of Zongshen Dongli City (the “First General Meeting”), claiming that a resolution (the “Resolution”) for the termination of the Property Management Contracts had been approved in the First General Meeting. On 31 March 2021, the Third Property Owners’ Association served a notice of termination to Chongqing Xintianyuan for the termination of the Property Management Contracts (the “Notice of Termination”). On 13 April 2021, Chongqing Xintianyuan initiated a civil lawsuit (the “Xintianyuan Litigation”) against the Third Property Owners’ Association with the People’s Court of Banan District, Chongqing (the “Court”). Chongqing Xintianyuan claimed that the procedures for holding the First General Meeting and passing the Resolution were illegal, and as a result, the Notice of Termination, which was based on the Resolution, did not have legal effect to terminate the Property Management Contracts.

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On 18 June 2021, Chongqing Xintianyuan received a decision of the Court dated 10 June 2021 on rejecting the jurisdiction objection raised by the Third Property Owners’ Association. As at the Latest Practicable Date, the Xintianyuan Litigation was pending on the final decision on the jurisdiction objection, subject to the Third Property Owners’ Association’s decision to appeal on the rejection of the jurisdiction objection.

To the best of our Directors’ knowledge, on 30 April 2021, certain individual property owners of Zongshen Dongli City initiated civil lawsuit (the “Individual Property Owners Litigation”) against the Third Property Owners’ Association with the Court, claiming that authenticity and legality of the First General Meeting and the Resolution are under dispute and requesting the Court to revoke the Resolution. As at the Latest Practicable Date, the Individual Property Owners Litigation had not commenced its first hearing. Based on the advice of the litigation lawyer engaged by Xintianyuan in the Xintianyuan Litigation, our Directors are of the view that if the Court rules in favour of the individual property owners in the Individual Property Owners Litigation, the Xintianyuan Litigation is expected to have a higher possibility of success.

As at the Latest Practicable Date, Chongqing Xintianyuan continued to provide property management services and collect property management fee pursuant to the Property Management Contracts. Based on the advice of the litigation lawyer engaged by Xintianyuan in the Xintianyuan Litigation, our Directors are of the view that before the final court ruling of the Xintianyuan Litigation, the provision of management services and collection of management fee pursuant to the Property Management Contracts does not violate any PRC laws and regulations. If the Court ultimately rules against Chongqing Xintianyuan in the Xintianyuan Litigation, the Property Management Contracts will be terminated and Chongqing Xintianyuan will then be required to cease to provide property management services to Zongshen Dongli City and collect property management fee accordingly.

Based on the advice of the litigation lawyer engaged by Xintianyuan in the Xintianyuan Litigation, our Directors are of the view that based on the evidence available before inspecting the evidence of the other side of the Xintianyuan Litigation, it has higher possibility that the Resolution will be considered as invalid because of procedural irregularities in connection with the First General Meeting and the passing of the Resolution, and as a result, Chongqing Xintianyuan has a higher possibility of success in the Xintianyuan Litigation.

During the process of acquisition of Chongqing Xintianyuan (the “Xintianyuan Acquisition”), we conducted proper due diligence on Chongqing Xintianyuan and identified the Xintianyuan Litigation before entering into the equity transfer agreement (the “Equity Transfer Agreement”) with the then shareholders of Chongqing Xintianyuan. We considered the risks associated with the Xintianyuan Litigation and believed Chongqing Xintianyuan has a higher probability of success. Notwithstanding that, we have included the following mechanisms (the “Protective Mechanisms”) to protect our interest: (i) when negotiating with the then shareholders of Chongqing Xintianyuan, we lowered the acquisition price to reflect the risks associated with the Xintianyuan Litigation; (ii) according to the Equity Transfer Agreement, among the consideration of the Xintianyuan Acquisition in the amount of RMB10.2 million, we will withhold RMB2.0 million and will only release, after the first anniversary of the completion of the Xintianyuan Acquisition and if the results of operations of Xintianyuan in terms of net profit, as evidenced by a professional accountants’ report, and GFA under

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Based on the advice of the litigation lawyer engaged by Xintianyuan in the Xintianyuan Litigation, our Directors are of the view that the size of the GFA and revenue being subject to the dispute and the abovementioned Protective Mechanisms, we believe that the results of the Xintianyuan Litigation will not have any material adverse effect on our business, financial condition and results of operations.

Historical Non-Compliance Incident

As advised by our PRC Legal Advisors, we had not been subject to significant fines or legal actions involving non-compliances with any PRC laws or regulations relating to our business during the Track Record Period and up to the Latest Practicable Date. The summary below sets out incident of historical non-compliance with applicable regulations during the Track Record Period. Our Directors believe that below non-compliance incident will not have any material operational or financial impact on us.

Background of non-compliance incident

During the Track Record Period, some of our PRC subsidiaries and branches failed to 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 our responsible personnel at our subsidiaries and branches did not adequately understand relevant local regulatory requirements, as our subsidiaries and branches are located in various provinces and cities in China and local regulatory requirements vary across different regions.

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, 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. 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.

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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 with respect to social insurance and housing provident funds 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 labour 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 RMB2.5 million, RMB2.3 million and RMB2.1 million for the year ended 31 December 2018, 2019 and 2020, respectively, and our Directors are of the view that such provisions are adequate; (v) a majority of our PRC subsidiaries and branches have obtained written or oral confirmations from competent local authorities of social insurance and housing provident funds indicating that no administrative penalty had been imposed on our PRC subsidiaries and branches; (vi) we will ensure our relevant PRC subsidiaries and branches fully comply in the event that the competent authorities require our relevant PRC subsidiaries and branches to make contributions to our outstanding payments; and (vii) our Controlling Shareholders [have undertaken] that in the event that we receive requests from the relevant authorities to pay the overdue social insurance and housing provident funds contributions, or that we are required to pay any late charges or penalties as a result of such overdue contributions, they will indemnify us against our payments of overdue contributions and any late charges or penalties imposed by the relevant authorities, to the extent that any such payment is not covered by the provisions we made for our shortfall of contribution to social insurance and housing provident funds.

In view of above, our PRC Legal Advisors are of the view that the risk that we would be subject to material administrative penalties for our aforementioned failure to make full contributions to the social insurance and housing provident funds for our employees by relevant authorities is low.

Rectification measures

To prevent future non-compliance incidents of similar nature, we have (i) engaged external compliance legal advisors in the PRC to provide advice on compliance matters; (ii) designated internal compliance team with legal professional qualification in the PRC to monitor the compliance matters of our Group; and (iii) formulated internal policies governing the matters in relation to social insurance and housing provident funds.

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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] or any option which may be granted under the Share Option Scheme), our Company will be owned as to [REDACTED]% by Wong-Holding, [REDACTED]% by Chan-Holding and [REDACTED]% by WC-Holding. Wong-Holding is wholly owned by Wong-BVI, which is in turn wholly owned by Mr. Wong. Chan-Holding is wholly owned by Chan-BVI, which is in turn wholly owned by Ms. Chan, the spouse of Mr. Wong. WC-Holding is wholly owned by WC-BVI, which is in turn owned as to 55% by Mr. Wong and 45% by Ms. Chan.

On 24 June 2021, Mr. Wong and Ms. Chan entered into an acting-in-concert agreement, whereby they agreed and confirmed that among other things, during the period starting from when they became the registered owners and/or beneficial owners of the interests in our Group to the date when any one of them ceases to be our Controlling Shareholder, they have voted and will continue to vote unanimously in accordance with the consensus achieved between them when exercising voting rights at shareholders’ meetings of each member company within our Group. See the section headed “History, Reorganisation and Corporate Structure — Acting-In-Concert Agreement” in this document for details.

Accordingly, Mr. Wong, Ms. Chan, Wong-Holding, Chan-Holding, WC-Holding, Wong-BVI, Chan-BVI and WC-BVI constitute a group of our Controlling Shareholders.

Each of Wong-Holding, Chan-Holding, WC-Holding, Wong-BVI, Chan-BVI and WC-BVI is an investment holding company.

DELINEATION OF BUSINESS

Our Group is principally engaged in the provision of property management services and commercial operational services.

Other than our Group, our Controlling Shareholders are interested in companies engaged in, among others, property development, landscape engineering, chemical production and hotel investment and operation (the “Non-included Businesses”). The Non-included Businesses are separate and distinct from our business. Our Directors are of the view that there is no competition between the Non-included Businesses and the businesses of our Group.

As at the Latest Practicable Date, none of our Controlling Shareholders and our Directors had any interest in any other business which competes or is likely to compete, either directly or indirectly with our Group’s business which would require disclosure under Rule 8.10 of the Listing Rules.

To ensure that competition will not exist in the future, Mr. Wong and Ms. Chan [have entered] into the Deed of Non-Competition in favour of our Group to the effect that each of them will not, and will procure each of their respective close associates not to, directly or indirectly participate in, or hold any right or interest, or otherwise be involved in any business which may be in competition with our business, further details of which are set out in the paragraph headed “—Deed of Non-Competition” below.

OUR BUSINESS RELATIONSHIP WITH RONGHUI GROUP

Our Group has a long-term, strategic and cooperative relationship with Ronghui Group. We have been providing Ronghui Group with property management services since the establishment of our Group in 2006, and commercial operational services since 2008. During the Track Record Period, all of the commercial properties and a substantial majority of the residential properties developed and owned by Ronghui Group were under our management. According to CIA, the business relationship between our Group and Ronghui Group is common among the property management and commercial operational service providers in the PRC and their affiliated property developers.

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Ronghui Group, founded and controlled by Mr. Wong, has over 17 years of property development experience and has comprehensive business offerings covering various industries. Ronghui Group was named as one of the 2018 Top 100 Leading Brands of China Comprehensive Real Estate Companies by CIA and one of the 2019 Top 100 China Real Estate Developers by CIA.

During the Track Record Period, we were engaged to provide property management services and commercial operational services to substantially all of the properties developed by Ronghui Group or its joint ventures and associates, and the success rate of our tender bids for preliminary property management contracts in respect of projects developed by Ronghui Group and its joint ventures and associates was 100%. See the section headed “Business—Property Management Services” in this document for more details.

Our Directors consider that the business relationship between our Group and Ronghui Group has been mutually beneficial and complementary. Our long-standing relationship and established track record of providing services to Ronghui Group has enabled us to be familiar with the standards and requirements of Ronghui Group, which has helped reduce communication costs, build mutual trust, as well as enabled us to constantly provide consistent quality property management and commercial operational services which meet the expectations and requirements of Ronghui Group. Our Directors believe that the long history of business relationship between our Group and Ronghui Group has resulted in well-established mutual understanding between the two groups.

Notwithstanding the large number of property management and/or commercial operational service providers available in the market, we believe that it would not be in the best interest of Ronghui Group to select and engage such other service providers, considering the amount of time and resources required for seeking a comparable service provider and developing a mutually beneficial business relationship. As demonstrated above and as confirmed by our Directors, our Group had, based on our own experience and expertise without relying on our relationship with Ronghui Group, secured a substantial portion of our property management projects in respect of properties developed by Ronghui Group through tendering processes during the Track Record Period. Going forward, given the existing mutually beneficial and complementary business relationship, and considering the amount of time and effort potentially required by Ronghui Group to engage other service providers which could provide equally satisfactory services, we are of the view that we will continue to have a competitive advantage which distinguishes us from our competitors and we believe we will continue to have a high success rate in securing future engagements from Ronghui Group. Based on the foregoing, our Directors are of the view that it is unlikely that the current business relationship between our Group and Ronghui Group would be materially adversely changed or terminated. See the section headed “Business—Relationship with Property Developers and Ronghui Group” in this document for further details.

Nevertheless, we have been actively pursuing business expansion opportunities in respect of services provided to properties developed by Independent Third Parties. See the section headed “Business— Relationship with Property Developers and Ronghui Group” in this document and the paragraph headed “—Independence from Our Controlling Shareholders—Operational Independence—Procurement of and achievements in securing independent projects” below for further details.

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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 engaged in the Non-included Businesses (the “Excluded Group”) after the [REDACTED] for the following reasons:

Management Independence

Our Board comprises two executive Directors, four non-executive Directors and three independent non-executive Directors. Certain of our Directors will hold directorship(s) and/or senior management position(s) in the Excluded Group, details of which are set out below:

Position(s) in our Name Group Positions in the Excluded Group

Ms. Wong Tan Ching . . Executive Director and Vice president of Ronghui Group, chairperson of the chairperson, Board director and/or manager of certain entities within the Excluded Group

Mr. Chen Zhong ...... Non-executive Director President of Ronghui Group and director and/or manager of certain entities within the Excluded Group

Mr. Feng Shijun ...... Non-executive Director Vice president of Ronghui Group and director and/or manager of certain entities within the Excluded Group

Mr. Pei Luyang ...... Non-executive Director Director of certain entities within the Excluded Group

Mr. Tang Shijie ...... Non-executive Director Vice chairperson, director and/or general manager of certain entities within the Excluded Group

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Notwithstanding the overlapping positions as mentioned above, our Directors are of the view that our Group is able to manage our business independently from our Controlling Shareholders and their respective close associates for the following reasons:

(i) save as disclosed above, there is no overlap between the senior management members of our Group and the Excluded Group. Our senior management team will carry out the business operations of our Group independently from our Controlling Shareholders and their respective close associates;

(ii) despite the dual roles of our executive Director, Ms. Wong Tan Ching, in our Group and the Excluded Group, she has been working closely with and will continue to work closely with our other executive Director, Mr. Wong Wai Lam, in respect of matters relating to our Group. They will be further supported by our independent senior management team in the handling of the day-to-day matters of our Group;

(iii) Mr. Chen Zhong, Mr. Feng Shijun, Mr. Pei Luyang and Mr. Tang Shijie as our non-executive Directors will not be involved in the day-to-day management and the business operations of our Group;

(iv) we have three independent non-executive Directors, representing one-third of the number of our Board members. The independent non-executive Directors will represent an element of independence at the Board level and will, among other matters, provide independent advice to other members of our Board; review and monitor any connected transactions as may be entered between our Group and our Controlling Shareholders and their respective close associates from time to time; and review and monitor matters referred to in the Deed of Non-Competition, details of which are set out in the paragraph headed “—Deed of Non-Competition” below, for the purpose of protecting the interests of our Company and our Shareholders as a whole;

(v) each of the Directors is aware of his/her fiduciary duties as a Director, which require, among other things, that he/she should for the benefit and in the best interests of our Company; and

(vi) in the event that there is any potential conflict of interest arising out of any transaction to be entered into between our Group and any of our Controlling Shareholders or their respective close associates, those Directors with a potential conflict of interest shall abstain from voting at the relevant board meeting of our Company in respect of such transaction and his/her presence shall not be counted in the quorum for such meeting.

Operational Independence

We are of the view that we have sufficient capital, facilities and employees and are able to make all decisions on, and to carry out, our own business operations independently from our Controlling Shareholders and their respective close associates and will continue to do so after the [REDACTED].

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Property management services

All of our property management services at the pre-delivery stage is provided to Ronghui Group, which is beneficially owned by Mr. Wong and Ms. Chan. Such preliminary management contracts for residential properties developed by Ronghui Group have been secured primarily through open standard tender and bidding processes, in which tender bids would be evaluated by tender evaluation committees established by Ronghui Group consisting of an odd number of five members or above, in accordance with applicable PRC laws and regulations. The tendering process is a well-established, competitive and fairly structured process on which neither Ronghui Group nor our Group is able to exert undue influence on the selection process. We do not enjoy any preferential right to be engaged as the preliminary property management service provider for projects developed by Ronghui Group and we are not given extra weighting in the selection process and will not be automatically awarded property management contracts simply due to our relationship with Ronghui Group. We undergo the same tender and bidding process to secure preliminary management contracts for properties developed by independent third-party property developers. For more information, see the section headed “Business—Property Management Services —Property Management Service Agreements” in this document.

After the delivery of the properties by Ronghui Group to the property owners, our property management services are provided to such property owners who are generally Independent Third Parties. The property owners may at their discretion establish a property owners’ association to manage the properties and through the property owners’ association, engage or dismiss their property management services provider at their own discretion. The property owners’ association, if formed, will be operated by the property owners and will be independent of Ronghui Group. Neither Ronghui Group nor our Group has the power or ability to influence the decisions of property owners or the property owners’ associations to engage or dismiss property management service providers. We have to provide quality services to the residents/owners of the properties in order to secure our continuous appointment. During the Track Record Period, we continued to provide property management services for most of the projects after the establishment of the property owners’ associations. In 2018, 2019 and 2020, the retention rate of the properties we managed was 97.7%, 97.7% and 100%, respectively, which we believe reflects our property management capabilities and shows that we are able to operate independently from Ronghui Group. After the delivery of the properties, we also provide community value-added services to a number of independent customers, including third-party property owners, property owners’ associations and residents.

While there are no regulatory requirements on the property owners to conduct bidding and tender process for the procurement and renewal of non-residential property management services for non-residential properties, our Group goes through a selection process in order to obtain the contracts for non-residential property management services. Once the business opportunities are made available to our Group, we would submit a proposal on the provision of property management services (which would mainly include the pricing and service standards). The respective departments/teams of Ronghui Group will review and assess the proposal submitted and determine whether or not to award the contracts to our Group.

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Commercial operational services

Historically, our Group procured commercial operational service engagements from Ronghui Group through commercial negotiations. Under applicable PRC laws and regulations, Ronghui Group is not required to go through any public tender procedures in engaging commercial operational service providers.

Typically after obtaining a parcel of land for the development of a property, Ronghui Group would invite our Group to submit a proposal on the provision of commercial operational services for the property. The proposal would include market research, preliminary design/positioning analysis, pricing strategy and estimated return of the property. In preparing the proposal, our Group would form a team comprising personnel responsible for finance, operation and brand management to perform works such as site visit, market research and preliminary positioning. The proposal would be submitted to Ronghui Group for its internal approval, the decision process of which would involve the consideration of the pricing standards adopted by our Group against those providing comparable services in the market. Our Group has to provide quality and competitive services to Ronghui Group in order to secure new as well as continuous appointment by Ronghui Group.

During the Track Record Period, the substantial majority of our revenue from commercial operational services was attributable to services provided to tenants after the opening of the commercial properties, who are usually Independent Third Parties.

Procurement of and achievements in securing independent projects

As at 31 December 2020, substantially all of our total GFA under management was developed by Ronghui Group and its joint ventures and associates. Despite the above, the majority of our revenue is attributable to independent individual property owners and tenants and independent third-party property developers. We have been able to maintain a diversified customer base, primarily by continuing our property management services to property owners or property owners’ associations after the delivery of properties, by participating in tender and bidding processes conducted by property developers, and by providing value-added services and commercial operational services to other property developers and third party tenants. Our revenue attributable to customers other than Ronghui Group and its joint ventures and associates accounted for approximately 81.2%, 80.9% and 74.8% of our total revenue for the years ended 31 December 2018, 2019 and 2020, respectively.

We have established business development teams with industry knowledge and experience at each of our operating regions which oversee the sourcing of projects, in particular ones developed by Independent Third Parties. We have implemented various incentive measures in 2021 to motivate and incentivise our employees to refer to us market information and opportunities for third-party projects. We plan to continue to increase the resources and efforts dedicated to our business development.

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Since 2020, we have been actively exploring new project engagements and potential acquisition opportunities with Independent Third Parties through various channels, such as, participation in tender and bidding processes and cooperation with third party business partners. Since 1 January 2021 and up to the Latest Practicable Date, we have secured a new engagement to provide commercial operational services to a property developed by an Independent Third Party with a total GFA available for tenant sourcing of approximately 25,756.9 sq.m.. We are also in the process of negotiating and/or pursuing additional engagements with Independent Third Parties. In addition, in May 2021, we acquired from Independent Third Parties 51% of the equity interest in Chongqing Xintianyuan, resulting in an increase in our GFA under management of properties developed or owned by Independent Third Parties of approximately 851,248.9 sq.m. In early 2021, we also signed two framework agreements with Independent Third Parties for strategic cooperations in respect of project design, property management and commercial operation for three tourism projects in various regions of the PRC.

Going forward, we shall continue our efforts in increasing the scale of our services provided to projects developed by independent third-party property developers (the “Independent Projects”) through (i) the securing of new property management engagements by participation in the tendering and bidding process for the management of such properties organised by property owners’ associations and independent third-party property developers; (ii) identifying and acquiring suitable target property management companies; and (iii) the entering into of strategic cooperation arrangements with independent third-party property developers. We plan to use [REDACTED]% of the [REDACTED]fromthe[REDACTED]to expand our property management service business and commercial operational service business through future acquisitions and investments, details of which are set out in “Future Plans and Use of [REDACTED]”. Our Directors are confident of our ability in expanding our portfolio of Independent Projects, in particular in respect of projects developed by independent third-party property developers of relatively smaller scale which are not supported by the relevant property developer’s affiliated property management services providers. We believe such property developers would welcome property management services and/or commercial operational services from a well-established and reputable services provider such as our Group. Accordingly, we believe that our management portfolio and revenue attributable to properties developed by Independent Third Parties will continue to increase. See the section headed “Business—Relationship with Property Developers and Ronghui Group” in this document for further details.

Licences required for operation

We hold and enjoy the benefit of all relevant licences and permits material to the operation of our business.

Access to customers, suppliers and business partners

We have a large and diversified base of customers, suppliers and business partners that are unrelated to our Controlling Shareholders and/or their respective close associates. We have independent access to such customers, suppliers as well as business partners.

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Operational facilities

As at the Latest Practicable Date, we were leasing six properties from our Controlling Shareholders and their respective close associates with an aggregate GFA of approximately 1,731.1 sq.m. mainly for office use and service provision venue. All other properties, facilities, equipment necessary for our business operations are independent from our Controlling Shareholders and their respective close associates.

Employees

As at the Latest Practicable Date, all of our full-time employees were recruited independently from our Controlling Shareholders and their respective close associates and primarily through both internal referrals and external sources such as recruiting websites and third-party recruiters.

Connected transactions with our Controlling Shareholders

The section headed “Connected Transactions” in this document sets out the continuing connected transactions between our Group and our Controlling Shareholders or their associates which will continue after the completion of the [REDACTED]. All such transactions are determined after arm’s length negotiations and on normal commercial terms.

We expect that we will be able to maintain the aggregate amounts of the continuing connected transactions with our Controlling Shareholders or their associates at a reasonable percentage with respect to our total revenues after [REDACTED]. Accordingly, such continuing connected transactions are not expected to affect our operational independence as a whole.

Financial Independence

All loans, advances and balances of non-trade nature due to or from our Controlling Shareholders or their respective close associates not arising from our ordinary course of business will be fully settled before completion of the [REDACTED]. All pledges and guarantees provided by our Group to support borrowings of Ronghui Group will be fully released before completion of the [REDACTED].

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, we believe we are able to maintain financial independence from our Controlling Shareholders and their respective close associates.

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DEED OF NON-COMPETITION

Each of Mr. Wong and Ms. Chan (the “Covenantors”) [has] irrevocably and unconditionally undertaken to us in the Deed of Non-Competition that he/she will not, and will procure his/her close associates (other than members of our Group) not to, directly or indirectly, conduct or be involved in any business (other than our business) that directly or indirectly competes, or may compete, with our business, being the provision of property management services and commercial operational services (the “Restricted Businesses”), or hold shares or interests in any companies or business that competes directly or indirectly with the Restricted Businesses, except where the Covenantors and their close associates hold (i) less than 30% of the total issued share capital of any company (whose shares are listed on the Stock Exchange or any other stock exchange); or (ii) less than 50% of interest of any private company, which is engaged in any business that is or may be in competition with any of the Restricted Businesses and they do not possess the right to control the board of directors of such company. The above restrictions do not apply when our Group engages in a new business that is not included in the Restricted Businesses and at the time of commencement of such new business, any of the Covenantors is already conducting or has been involved in, or otherwise been interested in, the relevant business.

Further, each of the Covenantors has undertaken that if any new business investment or other business opportunity relating to the Restricted Businesses (the “Competing Business Opportunity”) is identified by or made available to his/her or any of his/her close associates, he/she shall, and shall procure that his/her close associates shall, refer such Competing Business Opportunity to our Company on a timely basis by giving written notice (the “Offer Notice”) within 30 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 comprising Directors 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 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 advisers and legal advisers to assist in the decision making process in relation to such Competing Business Opportunity. The Independent Board shall, within 30 days of receipt of the written notice referred above, inform the Covenantors in writing on behalf of our Company its decision whether to pursue or decline the Competing Business Opportunity.

The relevant Covenantor 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 has failed to respond within such 30 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 Covenantor, he/she shall refer such revised Competing Business Opportunity to our Company as if it were a new Competing Business Opportunity.

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The Deed of Non-Competition will lapse automatically if the Covenantors and their respective close associates cease to hold, whether directly or indirectly, 30% or above of our Shares with voting rights or our Shares cease to be [REDACTED] on the Stock Exchange. In the event we cease to conduct any of the Restricted Businesses, the Covenantors will no longer be prohibited under the Deed of Non-Competition from conducting such business.

In order to promote good corporate governance and to improve transparency, the Deed of Non-Competition also includes the following provisions:

• each of the Covenantors has undertaken to us that he/she will provide and procure his/her close associates to provide on best endeavour basis, all information necessary for the annual review by our independent non-executive Directors for the enforcement of the Deed of Non-Competition; and

• 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 addition, our Company has taken, or will take, the following measures to safeguard good corporate governance standards in respect of the Deed of Non-Competition:

• our independent non-executive Directors shall review, at least on an annual basis, the compliance with the Deed of Non-Competition by the Covenantors;

• 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 the 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.

CORPORATE GOVERNANCE MEASURES

Each of our Controlling Shareholders has confirmed that he/she/it fully comprehends his/her/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/her associates have a material interest nor shall such Director be counted in the quorum present at the meeting;

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(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/her 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, non-executive Directors and independent non-executive Directors. We have appointed 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 judgement and will be able to provide an impartial, external opinion to protect the interests of our public Shareholders. For details of our independent non-executive Directors, please refer to the section headed “Directors and Senior Management—Board of Directors—Independent non-executive Directors” in this document;

(d) we have appointed CEB International Capital Corporation 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;

(e) as required by the Listing Rules, our independent non-executive Directors shall review any continuing 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 favourable 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;

(f) on an annual basis, our independent non-executive Directors will review the non-compete undertakings provided by the Controlling Shareholders and their compliance with such undertakings;

(g) on an annual basis, our independent non-executive Directors will review the compliance of Rule 8.10 of the Listing Rules by our Controlling Shareholder; and

(h) our Company will disclose in its annual report the compliance status of the Deed of Non-Competition.

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BOARD OF DIRECTORS

Our Board of Directors comprises two executive Directors, four non-executive Directors and three independent non-executive Directors. The powers and duties of our Board include determining our business and investment plans, preparing our annual financial budgets and final reports, and exercising other powers, functions and duties as conferred by the Articles. We [have entered] into a service agreement with each of our executive Directors and a letter of appointment with each of our non-executive Directors and independent non-executive Directors.

The table below sets out certain information in respect of our Directors:

Date of Date of Relationship with joining our appointment Position(s) in Roles and other Directors or Name Age Group as Director our Group responsibilities senior management

Executive Directors Ms. Wong Tan Ching (黃丹青) 37 25 August 4 February Executive Director Overall management Sister of Mr. Wong Wai 2008 2021 and chairperson and strategic planning Lam and spouse of of our Group Mr. Pei Luyang

Mr.WongWaiLam(黃威林) . 33 2 December 4 February Executive Director Overall operations and Brother of Ms. Wong 2010 2021 and executive strategic planning of Tan Ching and president our Group brother-in-law of Mr. Pei Luyang

Non-executive Directors Mr. Chen Zhong (陳忠).... 59 23June 2006 28 May 2021 Non-executive Providing guidance for None Director the overall development of our Group

Mr. Tang Shijie (唐世界) . . . 48 1 September 1 March 2021 Non-executive Providing guidance for None 2014 Director the overall development of our Group

Mr. Pei Luyang (裴路陽) . . . 37 17 January 28 May 2021 Non-executive Providing guidance for Spouse of Ms. Wong Tan 2017 Director the overall Ching and development of our brother-in-law of Group Mr. Wong Wai Lam

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Date of Date of Relationship with joining our appointment Position(s) in Roles and other Directors or Name Age Group as Director our Group responsibilities senior management Mr. Feng Shijun (馮世軍) . . . 53 8 December 28 May 2021 Non-executive Providing guidance for None 2006 Director the overall development of our Group

Independent non-executive Directors Ms. Chen Qingfang (陳慶芳). 70 [●] 2021 [●] 2021 Independent Providing independent None non-executive advice on the Director operations and management of our Group

Ms. Ng Chung Yan Linda 45 [●] 2021 [●], 2021 Independent Providing independent None (伍頌恩) ...... non-executive advice on the Director operations and management of our Group

Ms. Leung Bo Yee Nancy 48 [●] 2021 [●], 2021 Independent Providing independent None (梁寶儀) ...... non-executive advice on the Director operations and management of our Group

Executive Directors

Ms. Wong Tan Ching (黃丹青), aged 37, was appointed as our Director on 4 February 2021, and was re-designated as our executive Director and chairperson on 28 May 2021. She is primarily responsible for the overall management and strategic planning of our Group. Ms. Wong joined our Group in August 2008 and has been serving as the executive director of Fuzhou Ronghui since then. She also holds directorships in a number of our subsidiaries.

Ms. Wong has over 12 years of experience in the real estate and property management industries, having held positions in our Group and Ronghui Group since August 2008. Ms. Wong has been serving as a supervisor of Chongqing Zezhong Landscape Architecture Co., Ltd. (重慶澤眾園林股份有限公司)(“Chongqing Zezhong”), a landscape engineering company listed on the NEEQ (stock code: 839506) since July 2015, where she is primarily responsible for supervising the board and senior management of the company. Since June 2017, she has been serving as the chairman of Wuhu Ronghui Chemical Co., Ltd. (蕪湖融匯化工有限公司) (“Ronghui Chemical”), a chemical company, where she is primarily responsible for the overall operations and management.

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Ms. Wong was the vice chairperson of Shaxian Qingmao Paper Co., Ltd. (沙縣青懋紙業有限公司) and the chairperson and general manager of Wuhu Ronghui Trading Co., Ltd. (蕪湖融匯商貿有限公司)(“Wuhu Ronghui Trading”) which were dissolved on 26 April 2010 and 8 December 2020, respectively, due to the cessation of their business. She was the supervisor of Yunnan Ronghui Industry Co., Ltd. (雲南融匯實業有限公司)(“Yunnan Ronghui”), which was dissolved on 18 September 2013, as the company has not carried out substantial activities. She confirmed that, to the best of her knowledge and belief, as at the Latest Practicable Date, no claims had been made against her and she was not aware of any threatened or potential claims made against her and there are no outstanding claims and/or liabilities as a result of such dissolution.

Ms. Wong completed the Advanced Executive Business Administration Course by Institute of China’s Economic Reform & Development of Renmin University of China (中國人民大學中國經濟改革與發展研究院) in the PRC in July 2019. Ms. Wong was named as one of the “2016 Top 10 Businesswomen of Fujian Province” (2016年度十大巾幗閩商) in January 2017, one of the “2017 Top 10 Rising Star of Merchant of Fujian Province” (2017閩商十大新銳人物)in February 2018, the “18th Outstanding Entrepreneurs of Fujian Province” (第十八屆福建省優秀企業家) in September 2020 and the “Honorary Title of National Women Exemplar” (全國巾幗建功標兵榮譽稱號) in March 2021. Ms. Wong has been the vice president of the Fujian Overseas Women’s Association (福建省海外婦女聯誼會) since January 2015, the president of the Fujian Chamber of Women Entrepreneurs (福建省女企業家商會) since April 2017, the vice president of the All-China Federation of Industry and Commerce Chamber of Women Entrepreneurs (中華全國工商業聯合會女企業家商會) since January 2018, and the vice president of the Hong Kong Fujian Charitable Education Fund (香港福建希望工程基金會) since April 2021.

Ms. Wong Tan Ching is the daughter of Mr. Wong and Ms. Chan, our ultimate Controlling Shareholders.

Mr. Wong Wai Lam (黃威林), aged 33, was appointed as our Director on 4 February 2021, and was re-designated as our executive Director on 28 May 2021. He is primarily responsible for the overall operations and strategic planning of our Group. Mr. Wong Wai Lam joined our Group in December 2010 and has been serving as the person in charge of Shapingba Branch of Chongqing Ronghui PM since then and also chairman of Ronghui Guanling since May 2013. He also holds directorships in a number of our subsidiaries.

Mr. Wong Wai Lam has over 11 years of experience in the real estate and property management industries, having held positions in our Group since December 2010 and the Chongqing Ronghui Properties from July 2009 to February 2021. From August 2015 to March 2021, Mr. Wong Wai Lam served as the director of Chongqing Zezhong where he was primarily responsible for the operation and management of the company.

Mr. Wong Wai Lam was the director of Yunnan Ronghui which was dissolved on 18 September 2013, as the company has not carried out substantial activities. He was the director of Wuhu Ronghui Trading dissolved on 8 December 2020 due to the cessation of its business. He confirmed that, to the best of his knowledge and belief, as at the Latest Practicable Date, no claims had been made against him and he was not aware of any threatened or potential claims made against him and there are no outstanding claims and/or liabilities as a result of such dissolution.

Mr. Wong Wai Lam completed the Advanced Executive Business Administration Course by Institute of China’s Economic Reform & Development of Renmin University of China (中國人民大學中國經濟改革與發展研究院) in the PRC in July 2019. He was named as one of the “2016 Top 10 Annual Innovative Figure for Chongqing Economy” (2016十大重慶經濟年度創新人物)in March 2017.

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Mr. Wong Wai Lam is the son of Mr. Wong and Ms. Chan, our ultimate Controlling Shareholders.

Each of Ms. Wong Tan Ching and Mr. Wong Wai Lam [has] irrevocably and unconditionally undertaken to us that she/he will not, and will procure her/his close associates not to directly or indirectly conduct or be involved in any business (other than our business) that directly or indirectly competes, or may compete, with our business, being the provision of property management services and commercial operational services (the “Restricted Businesses”), or hold shares or interest in any companies or business that competes directly or indirectly with the business engaged by our Group, except where she/he and their close associates hold (i) less than 30% of the total issued share capital of any listed company; or (ii) less than 50% of interest of any private 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 possess the right to control the board of directors of such company. The above restrictions do not apply when our Group ceases to engage in certain of the Restricted Businesses, and when our Group engages in a new business that is not included in the Restricted Business and at the time of commencement of such new business, each of Ms. Wong Tan Ching and Mr. Wong Wai Lam is already conducting or has been involved in, or otherwise been interested in, the relevant business. The above restrictions in respect of Ms. Wong Tan Ching or Mr. Wong Wai Lam will lapse automatically, if she/he ceases to be our Director or senior management of our Group or our Shares cease to be [REDACTED] on the Stock Exchange.

Non-executive Directors

Mr. Chen Zhong (陳忠), aged 59, was appointed as our non-executive Director on 28 May 2021. Mr. Chen is primarily responsible for providing guidance for the overall development of our Group.

Mr. Chen has over 25 years of experience in the real estate industry. From November 1996 to August 2012, he served as the general manager of Fuzhou Jin’an District Real Estate Integrated Development Company (福州市晉安區房地產綜合開發公司), a company principally engaged in real estate development, where he was primarily responsible for the overall management. From December 2003 to January 2008, he served as the general manager of Chongqing Ronghui Industrial Co., Ltd. (重慶融匯實業有限公司), a company principally engaged in real estate development, where he was primarily responsible for the overall management. Since January 2008, he has been serving as the president of Chongqing Ronghui Properties, where he is primarily responsible for the overall management. Since July 2015, he has been serving as the director of Chongqing Zezhong, where he is primarily responsible for the operation and management of the company.

Mr. Chen was the chairman of Fuzhou Gurong Real Estate Development Co., Ltd. (福州古榕房地產開發有限公司) whose business licence was revoked on 28 August 2002 as the company had not carried out substantial activities and did not conduct the industrial and commercial annual inspection in accordance with the relevant regulations. He was the executive director of Chongqing Bohe Investment Co., Ltd. (重慶博合投資有限公司), which was dissolved on 27 December 2012, Chongqing Ronghui World Property Management Co., Ltd. (重慶融匯世界物業管理有限公司) dissolved on 20 November 2012, Shandong Ronghui Property Management Co., Ltd. (山東融匯物業管理有限公司) dissolved on 17 March 2021, and the general manager of Yunnan Ronghui dissolved on 18 September 2013, as the companies had not carried out substantial activities. He confirmed that, to the best of his knowledge and belief, as at the Latest Practicable Date, no claims had been made against him and he was not aware of any threatened or potential claims made against him and there are no outstanding claims and/or liabilities as a result of such revocation and dissolution.

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Mr. Tang Shijie (唐世界), aged 48, was appointed as our Director on 1 March 2021, and was re-designated as our non-executive Director on 28 May 2021. Mr. Tang is primarily responsible for providing guidance for the overall development of our Group.

Mr. Tang has extensive experience in accounting and financial management. From October 2001 to December 2004, Mr. Tang served as the staff of the inspection department of Minfa Securities Co., Ltd. (閩發證券有限責任公司), a securities company, where he was primarily responsible for internal inspection, audit and related affairs. From January 2006 to August 2012, he served as the financial director of the financing management department of Ronghui Fujian, an investment company focusing on real estate, chemical and related sectors, where he was primarily responsible for accounting and financial management. Since September 2014, he served as the general manager of the financial management centre and capital operation centre of Ronghui Fujian, where he was primarily responsible for financial management and financing and investment affairs.

Mr. Tang was the supervisor of Wuhu Ronghui Trading, which was dissolved on 8 December 2020 due to the cessation of its business. He confirmed that, to the best of his knowledge and belief, as at the Latest Practicable Date, no claims had been made against him and he was not aware of any threatened or potential claims made against him and there are no outstanding claims and/or liabilities as a result of such dissolution.

Mr. Tang obtained his bachelor’s degree in land management from Tongji University (同濟大學) in the PRC in July 1996 and his master’s degree in accounting from Fuzhou University (福州大學) in the PRC in March 2001. Mr. Tang obtained the Senior Qualification Level in Accounting (會計高級資格) issued by Fujian Department of Personnel (now known as Fujian Provincial Department of Human Resources and Social Security (福建省人力資源與社會保障廳) in May 2008 and the qualification of Certified Public Accountant (non-practising member) (註冊會計師（非執業會員）) issued by The Chinese Institute of Certified Public Accountants (中國註冊會計師協會) in December 2009.

Mr. Pei Luyang (裴路陽), aged 37, was appointed as our non-executive Director on 28 May 2021. Mr. Pei is primarily responsible for providing guidance for the overall development of our Group.

From December 2008 to September 2010, Mr. Pei worked in Fuzhou Branch of PICC Property and Casualty Company Limited (中國人民財產保險股份有限公司福建省分公司), an insurance company, where he was primarily responsible for insurance affairs. From September 2010 to December 2012, he served as the project assistant of Fujian Huaxing Venture Capital Co., Ltd. (福建華興創業投資有限公司), a company principally engaged in investment projects, where he was primarily responsible for investment affairs. From April 2015 to July 2015 and August 2016 to December 2016, he served as the executive deputy general manager of Fujian Senze Landscape Engineering Co., Ltd. (福建森澤園林工程有限公司), a landscape engineering company, where he was mainly responsible for the operation and management. From July 2015 to July 2016, he served as the deputy general manager of Chongqing Zezhong, where he was mainly responsible for the operation and management. From January 2017 to April 2021, Mr. Pei has served as the general manager at Fujian Ronghui PM, mainly responsible for operation and management of the company. Since April 2021, he has been serving as the director of Ronghui Fujian, mainly responsible for operation and management of the company.

Mr. Pei obtained his bachelor’s degree in business administration from Hogeschool van Arnhem en Ni Jmegen in Netherlands in December 2006.

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Mr. Feng Shijun (馮世軍), aged 53, was appointed as our non-executive Director on 28 May 2021. Mr. Feng is primarily responsible for providing guidance for the overall development of our Group.

Mr. Feng has extensive working experience in financial management. From December 2006 to January 2008, he served as the financial director of Chongqing Ronghui Investment Co., Ltd. (重慶融匯投資有限公司), a property development company, where he was primarily responsible for financial affairs. Since April 2007, he has been serving as the director of Chongqing Zezhong, where he is primarily responsible for the operation and management of the company. Since January 2008, he has been serving as the senior deputy president of Chongqing Ronghui Properties, primarily responsible for financial and capital affairs.

Mr. Feng was the supervisor of Yunnan Ronghui, which was dissolved on 18 September 2013, as the company had not carried out substantial activities. He confirmed that, to the best of his knowledge and belief, as at the Latest Practicable Date, no claims had been made against him and he was not aware of any threatened or potential claims made against him and there are no outstanding claims and/or liabilities as a result of such dissolution.

Mr. Feng obtained his bachelor’s degree in accounting from Renmin University of China (中國人民大學) from in the PRC in July 1991.

Independent non-executive Directors

Ms. Chen Qingfang (陳慶芳), aged 70, was appointed as our independent non-executive Director on [●] 2021. Ms. Chen is responsible for providing independent advice on the operations and management of our Board.

Ms. Chen has extensive experience in the property management industry. From September 1992 to August 1994, she worked at Haikou Yuhai Gelinmeng Hotel (海口渝海格林夢大酒店)of Hainan Yuhai Industrial Development Co., Ltd. (海南渝海實業開發總公司), where she served as the general manager and was mainly responsible for the overall operation and management. From September 1995 to October 2002, she served as the general manager of Chongqing Yuhai Property Management Co., Ltd. (重慶渝海物業管理有限責任公司), a property management company where she was primarily responsible for the overall operation and management. From October 2002 to August 2014, she served as the chairman of the board of Chongqing Jinheng Property Management Co., Ltd. (重慶金恒物業管理有限公司), a property management company where she was primarily responsible for the overall operation and management. From September 2014 to December 2018, she served as the chairman of the board of Chongqing Ruilong Property Management Co., Ltd. (重慶瑞隆物業管理有限公司), a property management company where she was primarily responsible for the overall operation and management.

Ms. Chen graduated from Yuzhou University (渝州大學) (now known as Chongqing Technology and Business University (重慶工商大學)) with a diploma in commercial enterprise management in the PRC in March 1992. She completed the Continuing Studies Course for Postgraduate in management science and engineering by Chongqing University (重慶大學)in the PRC in July 2000. Ms. Chen was certified as an Economist (經濟師) by the Leading Group for Professional Title Reform of Sichuan Province (四川省職稱改革工作領導小組) in June 1992. She obtained the Qualification Certificate of Certified Property Manager (物業管理師資格證)in March 2008 and the Registration Certificate of Certified Property Manager (物業管理師註冊證)in February 2014, both issued by the Ministry of Housing and Urban-Rural Development of the

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PRC (中華人民共和國住房和城鄉建設部) and 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).

Ms. Ng Chung Yan Linda (伍頌恩), aged 45, was appointed as our independent non-executive Director on [●] 2021. Ms. Ng is responsible for providing independent advice on the operations and management of our Board.

Ms. Ng has been serving as the independent non-executive director of ELL Environmental Holdings Limited, a company listed on the Main Board (stock code: 1395) since September 2014 and the director at Tseung & Ng (CPA) Limited since April 2012. Prior to that, she worked at Ernst & Young from September 2000 to October 2002, where she last served as the senior accountant. From September 2007 to December 2008, she served as the lecturer at Accountancy Training Company (International) Limited. From June 2010 to June 2012, she served as the lecturer at HKCA Learning Media Limited. From January 2008 to April 2013, she was the sole proprietor of Linda C.Y. Ng & Co, an accounting firm.

Ms. Ng obtained her bachelor’s degree in business administration from Hong Kong University of Science and Technology in November 1997 and her master’s degree in professional accounting from the Hong Kong Polytechnic University in October 2009. Ms. Ng has been a member of the Certified Practising Accountant Australia since January 2017, a certified professional forensic accountant of The Institute of Certified Forensic Accountants since September 2011, a certified tax adviser and an associate of the Taxation Institute of Hong Kong since September 2010, a fellow of the Association of Chartered Certified Accountants since October 2005 and a practising member of Hong Kong Institute of Certified Public Accountants since January 2005.

Ms. Leung Bo Yee Nancy (梁寶儀), aged 48, was appointed as our independent non-executive Director on [●] 2021. Ms. Leung is responsible for providing independent advice on the operations and management of our Board.

Ms. Leung has co-founded Leung & Lau, Solicitors (now known as Leung & Lau, Solicitors LLP) and stayed as a partner thereat since July 2005. From January 2005 to December 2008, she also served as a Teaching Fellow of the law faculty of the City University of Hong Kong. From September 1996 to November 2004, Ms. Leung worked as a trainee solicitor and then a solicitor at the Hong Kong office of Clyde & Co. From June 2016 to January 2018, she served as the independent non-executive director of New Trend Lifestyle Group plc, a company listed on the London Stock Exchange (LSE: NTLG). Since October 2019, she has been serving as the independent non-executive director of ELL Environment Holding Limited, a company listed on the Main Board (stock code: 1395).

Ms. Leung was the director of Global Happy Limited (宜喜有限公司) which was dissolved on 24 April 2020 due to the cessation of its business. She confirmed that, to the best of her knowledge and belief, as at the Latest Practicable Date, no claims had been made against her and she was not aware of any threatened or potential claims made against her and there are no outstanding claims and/or liabilities as a result of such dissolution.

Ms. Leung obtained her bachelor’s degree in law from The University of Hong Kong in July 1994, her master’s degree in law from the University of Cambridge in the United Kingdom in June 1996. Ms. Leung has been a member of the Law Society of Hong Kong since November 1998.

Save as disclosed above, none of our Directors have held any other directorships in listed companies during the three years immediately preceding the date of this Document. There is no

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Save as disclosed herein, to the best of the knowledge, information and belief of our Directors having made all reasonable inquiries, there was no other matter with respect to the appointment of our Directors that needed to be brought to the attention of our Shareholders and there was no information relating to our Directors that was required to be disclosed pursuant to Rules 13.51(2)(h) to (v) of the Listing Rules as at the Latest Practicable Date.

SENIOR MANAGEMENT

Our executive Directors and other members of our senior management are responsible for the day-to-day operations and management of the business of our Group.

For the biographical details of Ms. Wong Tan Ching and Mr. Wong Wai Lam, see the paragraph headed “—Executive Directors” above. Members of the senior management of our Group also include the following: Date of joining Existing position Roles and Name Age our Group in our Group responsibilities

Mr. Zhuo Min 45 25 September General manager of Responsible for the (卓敏) ...... 2018 property overall development business and operation of the department property management sector of our Group

Ms. Jiang Hong 46 6 August 2018 General manager of Responsible for the (蔣紅) ...... commercial overall coordination business and operation of department commercial operational projects, business development strategies determination and brand building of our Group

Mr. Zhuo Min (卓敏), aged 45, joined our Group in September 2018 and has been serving as the general manager of property business department of Chongqing Ronghui PM since then. He is primarily responsible for the overall development and operation of the property management sector of our Group.

Mr. Zhuo has over 21 years of experience in property management and property development industries. From February 2000 to March 2003, he served as the deputy manager of property department of Chongqing Shuntong Property Development Co., Ltd. (重慶順通物業開發有限公司), a property development company, where he was mainly responsible for the daily operation of the projects. From April 2003 to July 2005, he served as the customer service supervisor of Chongqing Zhonglianshan Property Management Co., Ltd. (重慶眾聯山物業管理有限公司), a property management company, where he was mainly responsible for the management of customer service. From July 2005 to April 2006, he served as the manager of

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Mr. Zhuo obtained his bachelor’s degree in land planning and utilisation from Southwest Agricultural University (西南農業大學) (now known as Xinan University (西南大學)) in the PRC in July 1998. Mr. Zhuo obtained the Qualification Certificate of Certified Property Manager (物業管理師資格證) issued by the Ministry of Housing and Urban-Rural Development of the PRC (中華人民共和國住房和城鄉建設部) and 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 October 2010. He was named as one of the “2019 Top 100 China Property Manager” (2019中國物業經理人100強) by CIA in December 2019.

Ms. Jiang Hong (蔣紅), aged 46, joined our Group in August 2018 and has been serving as the general manager of Ronghui Guanling since then. She is primarily responsible for the overall coordination and operations of commercial operational projects, business development strategies determination and brand building of our Group.

Ms. Jiang has over 22 years of experience in commercial operation management. From July 1998 to December 2000, she served as the investment manager of Nantong Jinying International Shopping Center Co., Ltd. (南通金鷹國際購物中心有限公司), a company principally engaged in commercial property development and operation, where she was mainly responsible for investment promotion and operation. From March 2004 to September 2005, she served as the manager of the investment department of Chongqing Yuneng Yibai Real Estate Development Co., Ltd. (重慶陽光壹佰房地產開發有限公司), a property development company, where she was mainly responsible for investment and operation management. From September 2005 to January 2017, she served as the deputy general manager of the commercial management centre of Tongjing Group Co., Ltd. (同景集團有限公司), a property development company, where she was mainly responsible for the overall operations and strategic planning of the commercial projects. She served as the head of commercial of Chongqing Yihe Industrial (Group) Co., Ltd. (重慶逸合實業(集團)有限公司) from March 2017 to August 2017 and Chongqing Xin’oupeng Real Estate (Group) Co., Ltd. (重慶新鷗鵬地產（集團）有限公司) from August 2017 to August 2018, both property development companies, where she was mainly responsible for the operations and strategic planning of the commercial projects.

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Ms. Jiang obtained her bachelor’s degree in business administration from Chongqing Technology and Business University (重慶工商大學) in the PRC in December 2008. She was named as one of the “Commercial Property Asian Cup-Excellent Figure of Commercial Property” (商業地產亞洲杯-商業地產傑出人物) and the “Commercial Property Golden Coordinate Award-Annual Pioneer of Commercial Property” (商業地產金坐標獎-年度商業地產先鋒人物) by Yingshang website (贏商網) in January 2019 and January 2020, respectively.

JOINT COMPANY SECRETARIES

Mr. Lin Wei (林偉), aged 35, was appointed as our joint company secretary on 28 May 2021 and is responsible for company secretarial matters of our Group. Mr. Lin has been serving as the person in charge of financial centre and securities department of our Group since April 2021, primarily responsible for daily affairs of the above mentioned departments.

From July 2009 to September 2014, Mr. Lin served as the staff at Ningde Regulatory Branch of Insurance Regulatory Commission of Bank of China (中國銀行保險監督管理委員會寧德監管分局), where he was mainly responsible for human resource affairs and bank supervision. From September 2014 to September 2017, he served as the project manager at Fuzhou branch of Grant Thornton (致同會計師事務所(特殊普通合夥)福州分所), where he was mainly responsible for audit affairs. From September 2017 to April 2021, he served as the senior investment manager at Ronghui Fujian, where he was mainly responsible for investment and financial affairs.

Mr. Lin obtained his bachelor’s degree in administrative management from Fuzhou University (福州大學) in the PRC in June 2009 and his master’s degree in accounting from Fuzhou University (福州大學) in the PRC in June 2016. Mr. Lin obtained the Intermediate Level Qualification in Accounting (會計中級資格) issued by Ningde Civil Service Administration (甯德市公務員局) in October 2013 and the qualification of Certified Public Accountant (non-practising member) (註冊會計師(非執業會員)) issued by The Chinese Institute of Certified Public Accountants (中國註冊會計師協會) in June 2020. He also obtained the Registered Qualification Certificate of Registered Tax Agent (註冊稅務師) issued by Fujian Provincial Department of Human Resources and Social Security (福建省人力資源與社會保障廳) in June 2014.

Ms. Chan Lok Yee (陳濼而), aged 31, was appointed as our joint company secretary on 28 May 2021 and is responsible for company secretarial matters of our Group.

Ms. Chan Lok Yee joined Vistra Corporate Services (HK) Limited in February 2016 and is a manager of corporate services. Ms. Chan Lok Yee has over seven years of experience in providing a full range of company secretarial and compliance services and is currently serving a portfolio of clients to include public listed companies, multinational corporations and private companies. Ms. Chan Lok Yee is currently the joint company secretary of Innovent Biologics, Inc. (信達生物製藥), a company listed on the Main Board (stock code: 1801), Alphamab Onology (康寧傑瑞生物製藥), a company listed on the Main Board (stock code: 9966), and MicroPort CardioFlow Medtech Corporation (微創心通醫療科技有限公司), a company listed on the Main Board (stock code: 2160) and the company secretary of C-Link Squared Limited, a company listed on the Main Board (stock code: 1463).

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Ms. Chan Lok Yee obtained her bachelor’s degree in arts from The Hong Kong Polytechnic University in October 2011 and her master’s degree of science in professional accounting and corporate governance from City University of Hong Kong in July 2015. Ms. Chan Lok Yee is an associate member of The Hong Kong Institute of Chartered Secretaries and an associate member of The Institute of Chartered Secretaries and Administrators (now known as The Chartered Governance Institute) in the United Kingdom since September 2015.

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.

Audit Committee

Our Group has established an audit committee on [●] 2021 with written terms of reference in compliance with Rule 3.21 of the Listing Rules and paragraphs C.3 of the Corporate Governance Code (the “CG Code”) as set out in Appendix 14 to the Listing Rules. The audit committee consists of Ms. Ng Chung Yan Linda, Mr. Tang Shijie and Ms. Leung Bo Yee Nancy. Ms. Ng Chung Yan Linda is the chairperson of the audit committee.

The primary duties of our audit committee are 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 in respect of financial, risk management and internal control matters; and (iii) perform other duties and responsibilities as may be assigned by the Board.

Remuneration Committee

Our Group has established a remuneration committee on [●] 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 to the Listing Rules. The remuneration committee consists of Ms. Ng Chung Yan Linda, Mr. Wong Tan Ching and Ms. Leung Bo Yee Nancy. Ms. Ng Chung Yan Linda is the chairperson of the remuneration committee.

The primary duties of our remuneration committee include, but not limited to (i) establishing, reviewing and providing advices to our Board on our policy and structure concerning remuneration of our Directors and senior management and on the establishment of a formal and transparent procedure for developing policies concerning such remuneration; (ii) determining the terms of the specific remuneration package of each Director and senior management; and (iii) reviewing and approving performance-based remuneration by reference to corporate goals and objectives resolved by our Directors from time to time.

Nomination Committee

Our Group has also established a nomination committee on [●] 2021 with written terms of reference in compliance with paragraph A.5 of the CG Code as set out in Appendix 14 to the Listing Rules. The nomination committee consists of Ms. Wong Tan Ching, Ms. Ng Chung Yan Linda and Ms. Leung Bo Yee Nancy. Ms. Wong Tan Ching is the chairperson of the nomination committee.

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The primary duties of our nomination committee are 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) perform review on the contributions made by our Directors (including our independent non-executive Directors) and the sufficiency of time devoted to perform their duties; (iv) assess the independence of our independent non-executive Directors; and (v) make recommendations to our Board on relevant matters relating to the appointment, re-appointment and removal of our Directors and succession planning for our Directors.

Given that our independent non-executive Directors have other roles outside our Group, our Company will adopt the following measures to ensure all of our Directors can carry out their duties and mitigate the risks arising from our Directors assuming multiple directorships in other listed companies upon [REDACTED]: (i) the Board and the nomination committee will review whether each of our Directors (including our independent non-executive Directors) is devoting sufficient time and attention to the affairs of our Group including but not limited to the review of the attendance record of the Board meetings or Board committee meetings; (ii) if there are concerns on the time commitments by the relevant Director(s) to our Company, the Board and the nomination committee may request the relevant Director(s) to provide an update to the Board in relation to any changes to his/her significant commitments; (iii) in evaluating and selecting any candidate for appointment or re-appointment as a Director, the Board will consider the candidate’s willingness and ability to devote adequate time to discharge his/her duties as a Director and/or members of the Board committees; (iv) at the time when our Company proposes a resolution to elect an individual as an independent non-executive Director at the general meeting, we will set out the reasons in the circular to our Shareholders and/or explanatory statement accompanying the notice of the relevant general meeting why the Board believes such individual should be elected, the reasons why such individual is considered to be independent by the Board and, if necessary, explain why such individual would still be able to devote sufficient time to the Board; (v) our independent non-executive Directors will provide us an annual confirmation of his/her commitment to devote sufficient time to attend to our Company’s affairs.

BOARD DIVERSITY POLICY

Our Board has adopted a board diversity policy which sets out the approach to achieve diversity on our Board. Our Company recognises and embraces the benefits of having a diverse Board and sees increasing diversity at the 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 talent, skills, gender, age, cultural and educational background, ethnicity, professional experience, independence, knowledge and length of service. We will select potential Board candidates based on merit and his/her potential contribution to our Board while taking into consideration our own business model and specific needs from time to time. 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.

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Our Board has a balanced mix of knowledge, skills and experience, including but without limitation to real estate development, property management, financial management and landscape engineering. They obtained degrees in various majors including but without limitation to law, land management, accounting and business administration. We have three independent non-executive Directors who have different industry backgrounds, including property management, accounting and law. Furthermore, our Directors are of a wide range of age, from 33 years old to 70 years old. Taking into account our business model and specific needs, we consider that the composition of our Board satisfies our board diversity policy.

We recognise the particular importance of gender diversity. Our Board currently comprises nine Directors, including four female Directors. We have taken and will continue to take steps to promote and ensure gender diversity at all levels of our Company, including but without limitation at our Board and senior management levels. Our board diversity policy provides that our Board shall take opportunities when selecting and making recommendations on suitable candidates for Board appointments with the aim to ensuring a balance of male and female members at all times. We will also ensure that there is gender diversity when recruiting staff at mid to senior level. It is our objective to maintain an appropriate balance of gender diversity with reference to the stakeholders’ expectation and international and local recommended best practices.

Our nomination committee is responsible for ensuring the diversity of our Board members. After [REDACTED], our nomination committee will review our board diversity policy and its implementation from time to time to monitor its continued effectiveness and we will disclose the implementation of our board diversity policy, including any measurable objectives set for implementing the board diversity policy and the progress on achieving these objectives, in our corporate governance report on an annual basis.

COMPLIANCE ADVISOR

We have appointed CEB International Capital Corporation Limited as our compliance advisor pursuant to Rule 3A.19 of the Listing Rules. Pursuant to Rule 3A.23 of the Listing Rules, our compliance advisor will advise our Company in the following circumstances:

• before the publication of any regulatory announcement, circular and financial report;

• where a transaction, which might be notifiable or connected transaction, is contemplated including shares issues and share repurchases;

• where our Company proposes to use the [REDACTED]fromthe[REDACTED]ina manner different from that detailed in this Document or where our business activities, developments or results deviate from any forecast, estimate or other information in this Document; and

• where the Stock Exchange makes an inquiry of our Company regarding unusual movements in the price or trading volume of our Shares.

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The term of the appointment shall commence on the [REDACTED] and end on the date on which our Company distribute our annual report in respect of our financial results for the first full financial year commencing after the [REDACTED].

COMPENSATION OF DIRECTORS AND SENIOR MANAGEMENT

Our Directors and members of our senior management receive compensation from our Group in the form of fees, salaries and other benefits and contribution to pension scheme.

The aggregate remuneration (including salaries, bonuses and other benefits and contribution to pension scheme) paid to our Directors for each of the three years ended 31 December 2020 was approximately RMB0.36 million, RMB0.39 million and RMB0.46 million, respectively. Save as disclosed above, no other amounts have been paid or are payable by any member of our Group to our Directors for each of the three years ended 31 December 2020.

The aggregate amount of salaries, bonuses and other benefits and contribution to pension paid to our five highest paid individuals in respect of each of the three years ended 31 December 2020 was approximately RMB2.5 million, RMB3.1 million and RMB3.8 million, respectively.

No remuneration was paid by us to our Directors or the five highest paid individuals as an inducement to join or upon joining us or as a compensation for loss of office in respect of each of the three years ended 31 December 2020. Further, none of our Directors had waived or agreed to waive any remuneration during the same periods.

Under the arrangement currently in force, the aggregate remuneration (including salaries, bonuses and other benefits and contribution to pension scheme) of our Directors for the year ending 31 December 2021 is estimated to be no more than approximately RMB1.39 million.

Our Board will review and determine the remuneration and compensation packages of our Directors and senior management and will, following the [REDACTED], receive recommendation from the remuneration committee which will take into account salaries paid by comparable companies, time commitment and responsibilities of our Directors and performance of our Group.

SHARE OPTION SCHEME

Our Company [has conditionally adopted] the Share Option Scheme on [●]. For details of the Share Option Scheme, please refer to the section headed “Statutory and General Information—D. Share Option Scheme” in Appendix IV to this document.

CORPORATE GOVERNANCE

Our Company aims to achieve high standards of corporate governance which are crucial to the development and safeguard the interests of our Shareholders. To accomplish this, our Company expects to comply with the CG Code and the associated Listing Rules after the [REDACTED].

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So far as our Directors are aware, the following persons will, immediately prior to and following the completion of the Capitalisation Issue and the [REDACTED] (without taking into account any Shares which may be issued pursuant to the exercise of the [REDACTED]orany option which may be granted under the Share Option Scheme), have interests or short positions in our Shares or underlying Shares, which would be required 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 member of our Group.

INTERESTS IN SHARES OF OUR COMPANY

Shares held as at the date of this Shares held immediately following document immediately prior to the the completion of the Name of Nature of completion of the Capitalisation Capitalisation Issue and the Shareholder interest Issue and the [REDACTED](1) [REDACTED](1) Approximate Approximate Number Percentage Number Percentage

Mr. Wong (2)(3)(4) ...... Interestincontrolled [7,896] Shares [78.96]% [REDACTED][REDACTED] corporations, (L) Interest of spouse [1,600] Shares [16.00]% [REDACTED][REDACTED] (L)

Ms. Chan (2)(3)(5) ...... Interestincontrolled [7,896] Shares [78.96]% [REDACTED][REDACTED] corporations, (L) Interest of spouse [1,600] Shares [16.00]% [REDACTED][REDACTED] (L)

WC-BVI (3) ...... Interestina [6,296] Shares [62.96]% [REDACTED][REDACTED] controlled (L) corporation

WC-Holding (3) ...... Beneficial owner [6,296] Shares [62.96]% [REDACTED][REDACTED] (L)

Wong-BVI (4) ...... Interestina [1,600] Shares [16.00]% [REDACTED][REDACTED] controlled (L) corporation

Wong-Holding (4) ..... Beneficial owner [1,600] Shares [16.00]% [REDACTED][REDACTED] (L)

Chan-BVI (5) ...... Interestina [1,600] Shares [16.00]% [REDACTED][REDACTED] controlled (L) corporation

Chan-Holding (5) ..... Beneficial owner [1,600] Shares [16.00]% [REDACTED][REDACTED] (L)

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Notes:

(1) The letter “L” denotes a long position in our Shares.

(2) Ms. Chan is the spouse of Mr. Wong. By virtue of the SFO, each of Mr. Wong and Ms. Chan is deemed to be interested in all the Shares in which the other is interested.

(3) WC-Holding is wholly owned by WC-BVI, which is owned as to 55% by Mr. Wong and 45% by Ms. Chan. By virtue of the SFO, each of WC-BVI, Mr. Wong and Ms. Chan is deemed to be interested in the Shares in which WC-Holding is interested.

(4) Wong-Holding is wholly owned by Wong-BVI, which is wholly owned by Mr. Wong. By virtue of the SFO, each of Wong-BVI and Mr. Wong is deemed to be interested in the Shares in which Wong-Holding is interested.

(5) Chan-Holding is wholly owned by Chan-BVI, which is wholly owned by Ms. Chan. By virtue of the SFO, each of Chan-BVI and Ms. Chan is deemed to be interested in the Shares in which Chan-Holding is interested in.

INTEREST IN EQUITY INTERESTS IN MEMBERS OF OUR GROUP

Equity interest held as of the date of this Equity interest held document immediately immediately prior following the to the completion of completion of the the Capitalisation Capitalisation Issue Issue and the and the Name of shareholder Group member concerned Nature of interest [REDACTED] [REDACTED] Approximate Approximate Percentage Percentage

Mr. Zhu Xiaopeng (朱小鵬).... Chongqing Xintianyuan Beneficial owner 49% 49%

Save as disclosed above, our Directors are not aware of any person who will, immediately following the completion of the Capitalisation Issue and the [REDACTED] (without taking into account any Shares which may be issued pursuant to the exercise of the [REDACTED]orany option which may be granted under the Share Option Scheme), have beneficial interests or short positions in any Shares or underlying Shares, which would be required 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 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 following is a description of the authorised and issued share capital of our Company in issue and to be issued as fully paid or credited as fully paid immediately before and following the completion of the Capitalisation Issue and [REDACTED] (without taking into account the exercise of the [REDACTED] or any option which may be granted under the Share Option Scheme):

Nominal value (HK$)

Authorised share capital:

[1,000,000,000] Shares of HK$0.01 each [10,000,000]

Issued and to be issued, fully paid or credited as fully paid:

[10,000] Shares in issue immediately prior to [100] the Capitalisation Issue [REDACTED] Shares to be issued pursuant to the Capitalisation Issue [REDACTED] [REDACTED] Shares to be issued under the [REDACTED][REDACTED]

[REDACTED] Total [REDACTED]

ASSUMPTIONS

The above table assumes that the [REDACTED] becomes unconditional and the Shares are issued pursuant to the [REDACTED]. It takes no account of any Shares which may be allotted and issued pursuant to the exercise of the [REDACTED] or any option which may be granted under the Share Option Scheme or any Shares which may be issued or repurchased by us pursuant to the general mandates granted to our Directors to issue or repurchase Shares as described below.

RANKINGS

The [REDACTED] will be ordinary shares in the share capital of our Company and will carry the same rights in all respects with all Shares in issue or to be issued as mentioned in this document and, in particular, will rank in full for all dividends or other distributions declared, made or paid on the Shares in respect of a record date which falls after the date of this document save for the entitlement under the Capitalisation Issue.

GENERAL MANDATE TO ALLOT AND ISSUE AND TO REPURCHASE SHARES

Subject to the [REDACTED] becoming unconditional, general mandates have been granted to our Directors to allot and issue Shares and to repurchase Shares. For details of such general mandates, please see the section headed “Statutory and General Information—A. Further Information about our Group—4. Written resolution of our Shareholders passed on [●] 2021” in Appendix IV to this document.

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CIRCUMSTANCES UNDER WHICH GENERAL MEETING AND CLASS MEETING ARE REQUIRED

Our Company has only one class of shares, namely ordinary shares, each of which carries the same right as with the other shares.

As a matter of the Companies Act, an exempted company is not required by law to hold any general meeting or class meeting. The holding of general meeting or class meeting is prescribed under the articles of association of a company. Accordingly, our Company will hold general meetings as prescribed under the Articles, a summary of which is set out in the section headed “Summary of the Constitution of our Company and Cayman Islands Companies Law” in Appendix III to this document.

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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 of our Company under Chapter 14A of the Listing Rules upon [REDACTED].

(A) CONTINUING CONNECTED TRANSACTIONS SUBJECT TO THE REPORTING, ANNUAL REVIEW AND ANNOUNCEMENT REQUIREMENTS BUT EXEMPT FROM THE CIRCULAR AND INDEPENDENT SHAREHOLDERS’ APPROVAL REQUIREMENTS

1. Master Procurement Agreement

On [●] 2021, our Company entered into a master procurement agreement with Ronghui Fujian (the “Master Procurement Agreement”), pursuant to which we may procure from Ronghui Group and its associates food products produced by it and entrance coupons for hot springs owned by it, for our marketing promotional activities and as benefits for employees of our Group (the “Procurement”). The Master Procurement Agreement has a term commencing from the [REDACTED] to 31 December 2023.

For each of the three years ended 31 December 2018, 2019 and 2020, the transaction amount for the Procurement amounted to approximately RMB0.4 million, RMB0.4 million and RMB0.5 million, respectively.

The price of the Procurement will be determined on an arm’s length basis with reference to, among others, the prevailing market price of the products and the wholesale price Ronghui Group and its associates offers to the Independent Third Parties for similar products.

It is estimated that the maximum amount payable by our Group under the Master Procurement Agreement for each of the three years ending 31 December 2023 will not exceed RMB1.0 million, RMB1.0 million and RMB1.2 million, respectively.

In arriving at the above annual caps for the Procurement, our Directors have considered the following factors which they considered to be reasonable and justifiable in the circumstances:

• the historical transaction amounts and growth trend during the Track Record Period; and

• the estimated increase in demand of our Group for the Procurement taking into account the expansion plan of our Group in the next three years and the estimated increasing GFA under management as well as number of employees of our Group.

Ronghui Fujian is indirectly wholly owned by Mr. Wong and Ms. Chan, both our Controlling Shareholders, and therefore a connected person of our Company for the purpose of the Listing Rules. Accordingly, the transactions under the Master Procurement 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 for the Master Procurement Agreement is expected to be over 0.1% but less than 5% on an annual basis, the transactions under the Master Procurement Agreement constitute continuing connected transactions for our Company which are subject to the reporting, annual review and announcement requirements but exempt from the circular and independent Shareholders’ approval requirement under Chapter 14A of the Listing Rules.

(B) CONTINUING CONNECTED TRANSACTIONS SUBJECT TO THE REPORTING, ANNUAL REVIEW, ANNOUNCEMENT, CIRCULAR AND INDEPENDENT SHAREHOLDERS’ APPROVAL REQUIREMENTS

1. Property Management Services

On [●] 2021, our Company entered into a master property management services agreement (the “Master Property Management Services Agreement”) with Mr. Wong, pursuant to which our Group agreed to provide to Mr. Wong’s associates, particularly Ronghui Group and its associates, property management and related services, including but not limited to (i) pre-delivery services including (a) preliminary planning and design consultancy services, (b) sales centre management services, (c) pre-delivery cleaning, gardening and security services, and (d) pre-delivery inspection; (ii) repair and maintenance services; (iii) property management services for the properties owned or used by Mr. Wong’s associates, including but not limited to unsold residential property units, car parking lots, public space and commercial properties; and (iv) additional tailor-made services such as public facilities cleaning (the “Property Management and Related Services”). The Master Property Management Services Agreement has a term commencing from the [REDACTED] until 31 December 2023.

For the three years ended 31 December 2018, 2019 and 2020, the total service fee payable to our Group in respect of the Property Management and Related Services amounted to approximately RMB37.0 million, RMB41.5 million and RMB47.9 million, respectively.

The fees to be charged for the Property Management and Related Services will be determined after arm’s length negotiations with reference to (i) the prevailing market price for the relevant services (taking into account the location, size and condition of the properties, the scope and standard of services and the anticipated operational costs including but not limited to labour costs, administrative costs and cost of materials) and (ii) historical transaction amounts.

It is estimated that the maximum amounts of service fee payable to our Group in relation to the Property Management and Related Services for the three years ending 31 December 2023 will not exceed RMB55.0 million, RMB57.0 million and RMB52.0 million, respectively. The expected decrease in the annual caps for the Property Management and Related Services for the three years ending 31 December 2023 is mainly due to the expected decrease in demand of Ronghui Group and its associates for the Property Management and Related Services, having taken into account (i) the latest operating performance of Ronghui Group and its associates; and (ii) the expected GFA to be delivered by Ronghui Group and its associates for the three years ending 31 December 2023 as estimated with reference to our understanding of its future property development plan.

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In arriving at the above annual caps of the Property Management and Related Services, our Directors have considered the following factors which they considered to be reasonable and justifiable in the circumstances:

• the historical transaction amounts and growth trend during the Track Record Period;

• the estimated revenue to be recognised in respect of the Property Management and Related Services provided by us pursuant to existing contracts and the expected time and volume of delivery for our existing property management projects;

• the estimated GFA of the properties expected to be developed and sold by Ronghui Group and its associates in the relevant periods, estimated based on the land bank of Ronghui Group and its associates as at 31 December 2020 as well as the GFA of their historical sales; and

• in respect of the annual caps for the property management services to be provided for the unsold residential property units and unsold carpark lots, (i) the aggregate area of the unsold residential property units and aggregate number of unsold car parking lots for the relevant periods, estimated with reference to (a) the historical average vacancy rate, and (b) the expected total GFA under management and (ii) the estimated property management fees to be charged per sq.m.

Mr. Wong is one of our Controlling Shareholders 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].

Since each of the applicable percentage ratios under the Listing Rules in respect of the annual caps for the Master Property Management Services Agreement is expected to be more than 5% on an annual basis, the transactions under the Master Property Management Services Agreement constitute continuing connected transactions for our Company which are subject to the reporting, annual review, announcement, circular and independent Shareholders’ approval requirements under Chapter 14A of the Listing Rules.

2. Commercial Operational Services

On [●] 2021, our Company entered into a master commercial operational services agreement (the “Master Commercial Operational Services Agreement”) with Ronghui Fujian, pursuant to which our Group agreed to provide to Ronghui Group and its associates commercial operational services, including but not limited to (i) preparation services at the pre-opening stage including (a) market research and positioning, (b) advice on architectural design, (c) tenant sourcing and opening preparation services; and (ii) commercial operational services after the opening of the commercial properties owners including tenant agreement coordination, tenant management, advertising and

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promotion, public relation and other administrative services (the “Commercial Operational Services”). The Master Commercial Operational Services Agreement has a term commencing from the [REDACTED] until 31 December 2023.

For the three years ended 31 December 2018, 2019 and 2020, the total service fee payable to our Group in respect of the Commercial Operational Services amounted to nil, nil and approximately RMB6.2 million, respectively.

The fees to be charged for the Commercial Operational Services will be determined after arm’s length negotiations with reference to (i) the size, location and neighbourhood profile of the commercial properties, (ii) the scope and standard of services to be provided, (iii) the anticipated operational costs (including but not limited to labour costs, costs of materials and administrative costs), (iv) the rates generally offered in the market in respect of comparable services, and (v) the prevailing market price for similar services and types of projects.

It is estimated that the maximum amounts of service fee payable to our Group in relation to the Commercial Operational Services for the three years ending 31 December 2023 will not exceed RMB17.0 million, RMB14.0 million and RMB10.0 million, respectively. The expected higher annual caps for the Commercial Operational Services as compared to the historical transaction amounts for the Track Record Period is mainly due to the expected increase in demand for Commercial Operational Services, taking into account (i) the latest operating performance of Ronghui Group and its associates, (ii) the expected GFA to be delivered by Ronghui Group and its associates for the three years ending 31 December 2023 as estimated with reference to our understanding of its future property development plan; and (iii) our Group commenced charging service fees for the provision of tenants agreement coordination and tenants management, advertising and promotion, public relation and other administrative services from 2021. The decrease in the annual caps for the Commercial Operational Services in the coming three years is mainly due to the expected decrease in number and total GFA of new commercial properties of Ronghui Group and its associates which are expected to commence operation during the three years ending 31 December 2023, estimated based on our understanding of its future property development and opening plan.

In arriving at the above annual caps of Commercial Operational Services, our Directors have considered the following factors which they considered to be reasonable and justifiable in the circumstances:

• the historical transaction amounts and growth trend during the Track Record Period;

• the estimated revenue to be recognised in relation to the Commercial Operational Services provided by us pursuant to the existing contracts and the expected time and volume of delivery for our existing commercial operational projects; and

• the estimated GFA of the commercial properties expected to be developed by Ronghui Group and its associates in the relevant periods, estimated based on the land bank of Ronghui Group and its associates as at 31 December 2020 as well as its historical developed GFA and the related growth rate.

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Ronghui Fujian is indirectly wholly owned by Mr. Wong and Ms. Chan, both our Controlling Shareholders and therefore a connected person of our Company for the purpose of the Listing Rules. Accordingly, the transactions under the Master Commercial Operational Services Agreement will constitute continuing connected transactions for our Company under Chapter 14A of the Listing Rules upon [REDACTED].

Since each of the applicable percentage ratios under the Listing Rules in respect of the annual caps for the Master Commercial Operational Services Agreement are expected to be more than 5% on an annual basis, the transactions under the Master Commercial Operational Services Agreement constitute continuing connected transactions for our Company which are subject to the reporting, annual review, announcement, circular and independent Shareholders’ approval requirements under Chapter 14A of the Listing Rules.

3. Carpark Sales Services

On [●] 2021 our Company entered into a master carpark sales services agreement (the “Master Carpark Sales Services Agreement”) with Ronghui Fujian, pursuant to which our Group agreed to provide marketing and sales services for the unsold car parking spaces of Ronghui Group and its associates (the “Carpark Sales Services”). The Master Carpark Sales Services Agreement has a term commencing from the [REDACTED] until 31 December 2023.

For the years ended 31 December 2018, 2019 and 2020, the total amount of fees received by our Group for the provision of Carpark Sales Services amounted to nil, approximately RMB0.5 million and RMB6.4 million, respectively. The increase in the fee received by our Group for the provision of Carpark Sales Services in 2020 was mainly due to the increased efforts of our Group to expand our carpark sales business since 2019 when we started to provide such services to Ronghui Group.

The fees to be charged for the Carpark Sales Services will be a fixed fee per carpark unit sold with the assistance of our Group, which will be determined after arm’s length negotiations with reference to the prevailing market price taking into account the location and the conditions of the relevant unsold carparks and the anticipated operational costs including labour costs.

It is estimated that the maximum amounts of service fees receivable by our Group in relation to the Carpark Sales Services for the three years ending 31 December 2023 will not exceed RMB13.0 million, RMB8.0 million and RMB8.0 million, respectively. The expected higher annual caps for the Carpark Sales Services as compared to the transaction amounts during the Track Record Period is mainly due to the expected increase in our service capacity for the Carpark Sales Services resulting from our efforts in the service provision as well as the expected increase of fixed fee per carpark unit sold. The expected decrease in the annual caps for the Carpark Sales Services for the next three years is mainly due to the relatively lower increase in the service demand of Ronghui Group for the Carpark Sales Services considering the development plan of Ronghui Group and that more existing unsold car parking spaces are expected to be sold in 2021.

In arriving at the above annual caps of Carpark Sales Services, our Directors have considered the following factors which they considered to be reasonable and justifiable in the circumstances:

• the historical transaction amounts during the Track Record Period;

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• the estimated revenue to be recognised based on the existing signed contracts;

• the expected number of unsold car parking spaces owned by Ronghui Group and its associates, which is estimated based mainly on the existing projects available for sale, as well as the expected number of properties to be developed by Ronghui Group and its associates which will comprise car parking spaces considering the development plan of Ronghui Group; and

• the expected amount of service fee per car parking space sold.

Ronghui Fujian is indirectly wholly owned by Mr. Wong and Ms. Chan, both our Controlling Shareholders and therefore a connected person of our Company for the purpose of the Listing Rules. Accordingly, the transactions under the Master Carpark Sales Services Agreement will constitute continuing connected transactions for our Company under Chapter 14A of the Listing Rules upon [REDACTED].

Since each of the applicable percentage ratios under the Listing Rules in respect of the annual caps for the Master Carpark Sales Services Agreement is expected to be more than 5% on an annual basis, the transactions under the Master Carpark Sales Services Agreement constitute continuing connected transactions for our Company which are subject to the reporting, annual review, announcement, circular and independent Shareholders’ approval requirements under Chapter 14A of the Listing Rules.

The transactions described in the paragraph headed “—(A) Continuing Connected Transactions subject to the Reporting, Annual Review and Announcement Requirements but exempt from the Circular and Independent Shareholders’ Approval Requirements” above constitutes our continuing connected transactions under the Listing Rules, which are subject to the reporting, annual review and announcement requirements but exempt from the circular and independent Shareholders’ approval requirements of the Listing Rules.

The transactions described in the paragraph headed “—(B) Continuing Connected Transactions subject to the Reporting, Annual Review, Announcement, Circular and Independent Shareholders’ Approval Requirements” above constitute our continuing connected transactions under the Listing Rules, which are subject to the reporting, annual review, announcement, circular and independent Shareholders’ approval requirements of the Listing Rules.

In respect of these continuing connected transactions, pursuant to Rule 14A.105 of the Listing Rules, we have applied for, and the Stock Exchange [has granted], waiver exempting from strict compliance with the announcement requirement under Chapter 14A of the Listing Rules in respect of the continuing connected transactions as disclosed in the paragraph headed “—(A) Continuing Connected Transactions subject to the Reporting, Annual Review and Announcement Requirements but exempt from the Circular and Independent Shareholders’ Approval Requirements” above; and the announcement, circular and independent Shareholders’ approval requirements under Chapter 14A of the Listing Rules in respect of the

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If any of the terms of the transactions contemplated under the agreements mentioned above are altered or if our Company enters into any new agreement with any connected person in the future, we will fully comply with the relevant requirements under Chapter 14A of the Listing Rules, unless we apply for and separate waiver is obtained from, the Stock Exchange.

(D) DIRECTORS’ VIEWS

Our Directors (including our independent non-executive Directors) consider that all the continuing connected transactions described in the paragraph headed “—(A) Continuing Connected Transactions subject to the Reporting, Annual Review and Announcement Requirements but exempt from the Circular and Independent Shareholders’ Approval Requirements” and “—(B) Continuing Connected Transactions subject to the Reporting, Annual Review, Announcement, Circular and Independent Shareholders’ Approval Requirements” above have been and will be carried out: (i) in the ordinary and usual course of our business; (ii) on normal commercial terms; and (iii) in accordance with the respective terms that are fair and reasonable and in the interests of our Company and our Shareholders as a whole.

Our Directors (including our independent non-executive Directors) are also of the view that the annual caps of the continuing connected transactions in the paragraph headed “—(A) Continuing Connected Transaction subject to the Reporting, Annual Review and Announcement Requirements but exempt from the Circular and Independent Shareholders’ Approval Requirements” and “—(B) Continuing Connected Transactions subject to the Reporting, Annual Review, Announcement, Circular and Independent Shareholders’ Approval Requirements” above are fair and reasonable and are in the interests of our Shareholders as a whole.

(E) SOLE SPONSOR’S VIEW

The Sole Sponsor is of the view (i) that the continuing connected transactions described in the paragraph headed “—(A) Continuing Connected Transactions subject to the Reporting, Annual Review and Announcement Requirements but exempt from the Circular and Independent Shareholders’ Approval Requirements” and “—(B) Continuing Connected Transactions subject to the Reporting, Annual Review, Announcement, Circular and Independent Shareholders’ Approval Requirements” above have been and will be entered into in the ordinary and usual course of our business, on normal commercial terms, that are fair and reasonable and in the interests of our Company and our Shareholders as a whole, and (ii) that the proposed annual caps (where applicable) of such continuing connected transactions are fair and reasonable and in the interests of our Company and our Shareholders as a whole.

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You should read the following discussion and analysis in conjunction with our combined financial information, including the accompanying notes thereto, as set forth in the Accountants’ Report in Appendix I to this document. Our combined financial information was prepared in accordance with the HKFRSs, which may differ in material aspects from generally accepted accounting principles in other jurisdictions.

The following discussion and analysis contain certain forward-looking statements which involve risks and uncertainties. These forward-looking statements are based on assumptions and analysis we made in light of our experience and perception of historical trends, current conditions and expected future developments, as well as other factors we believe are appropriate under the circumstances. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under the section headed “Risk Factors” and elsewhere in this document.

OVERVIEW

We are a comprehensive provider of property management services and commercial operational services with over 15 years of operational experience. According to CIA, we ranked 55th among the 2020 Top 100 Property Management Companies and 50th among the 2021 Top 100 Property Management Companies in China in terms of overall strength. We have also been one of the Top 100 Property Management Companies in China for four consecutive years since 2018. We primarily focus on key cities in Chengdu-Chongqing Economic Zone, Bohai Rim Economic Zone and Western Taiwan Straits Economic Zone. We are also a large-scale integrated property management service provider in the Southwest Region that combines property management and commercial operation. According to CIA, among the 2020 Top 100 Property Management Companies in China. We also ranked 36th in terms of total GFA under management of large-scale integrated property, 10th in terms of total GFA under management of large-scale integrated property in the Southwest Region, and fourth in terms of total GFA under management of large-scale integrated property in Chongqing. We were awarded the “China Leading Property Management Companies in terms of Characteristic Service—Large-scale Integrated Property Operational Services” by CIA in both 2020 and 2021. We provide diversified services through the following two business lines:

• Property management services business line, which primarily includes (i) general property management services; (ii) value-added services to non-property owners; and (iii) community value-added services. As at 31 December 2020, we provided property management services to 47 projects with a total GFA under management of approximately 6.4 million sq.m. As at the same date, we were contracted to provide property management services to 57 projects with a total contracted GFA of approximately 8.3 million sq.m.; and

• Commercial operational services business line, which primarily includes (i) commercial operational services to tenants; and (ii) commercial operational services to property developers and property owners. As at 31 December 2020, we provided commercial operational services to 13 projects with a total contracted GFA of approximately 0.3 million sq.m.

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BASIS OF PRESENTATION

Pursuant to the Reorganisation, as more fully explained in the section headed “History, Reorganisation and Corporate Structure” in this document, our Company became the holding company of the companies now comprising our Group on 3 June 2021. The companies now comprising our Group were under the common control of the Controlling Shareholders before and after the reorganisation. Accordingly, the historical financial information in the Accountants’ Report has been prepared on a combined basis by applying the principles of merger accounting as if the reorganisation had been completed at the beginning of the Track Record Period. The combined statements of profit or loss and other comprehensive income, statements of changes in equity and statements of cash flows of our Group for the Track Record Period include the results and cash flows of all companies now comprising our Group from the earliest date presented or since the date when the subsidiaries and/or businesses first came under the common control of the controlling shareholders, where this is a shorter period. The combined statements of financial position of our Group as at 31 December 2018, 2019 and 2020 have been prepared to present the assets and liabilities of the subsidiaries and/or businesses using the existing book values from the controlling shareholders’ perspective. No adjustments are made to reflect fair values, or recognise any new assets or liabilities as a result of the Reorganisation. Equity interests in subsidiaries and/or businesses held by parties other than the controlling shareholders, and changes therein, prior to the reorganisation are presented as non-controlling interests in equity in applying the principles of merger accounting. All intra-group transactions and balances have been eliminated on combination.

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The financial information of our Group during the Track Record Period has been prepared in accordance with accounting policies which conform with the HKFRSs, which collective term includes all applicable individual Hong Kong Financial Reporting Standards, Hong Kong Accounting Standards (“HKASs”) and Interpretations issued by the HKICPA. The financial information of the Group during the Track Record Period also complies with the applicable disclosure requirements of the Companies Ordinance and the Listing Rules.

The HKICPA has issued a number of new and amended HKFRSs which are relevant to the Group and became effective during the Track Record Period. For the purpose of preparing and presenting the financial information of the Group during the Track Record Period for the Track Record Period, the Group has adopted all new and amended HKFRSs that are effective during the Track Record Period and has applied them consistently throughout the Track Record Period. The financial information of the Group during the Track Record Period has been prepared on the historical cost basis.

FACTORS AFFECTING OUR RESULTS OF OPERATIONS

Our business, financial position and results of operations have been, or may be expected to be in the future, significantly affected by a number of factors, many of which may be beyond our control. A discussion of certain of these key factors is set out below.

Our Business Scale

Our financial position and results of operations are affected by our business scale, especially the GFA under management for our property management services and the number of projects and the contracted GFA for our commercial operational services.

During the Track Record Period, we generated a majority of our revenue from property management services. The revenue from our property management services business line amounted to RMB164.8 million, RMB186.8 million and RMB203.3 million, respectively, accounting for 82.8%, 83.3% and 84.2% of our total revenue in the years ended 31 December 2018, 2019 and 2020, respectively. Accordingly, our revenue growth under property management services largely depends on our ability to maintain and increase our GFA under management, which is in turn affected by our ability to renew existing property management service contracts and secure new property management service engagements. The GFA under management will also affect our community value-added services as we manage more projects and serve an increasing number of property owners and residents from our managed projects.

During the Track Record Period, we experienced a continual growth in our GFA under management for our property management services, which amounted to approximately 5.7 million sq.m., 6.0 million sq.m. and 6.4 million sq.m. as at 31 December 2018, 2019 and 2020, respectively.

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For our commercial operational services business line, our revenue amounted to RMB34.1 million, RMB37.4 million and RMB38.1 million, respectively, and accounted for 17.2%, 16.7% and 15.8% of our total revenue in the year ended 31 December 2018, 2019 and 2020, respectively. Our revenue growth under commercial operational services business line largely depends on our ability to maintain and increase the number of projects, scope of our services and price of our services. As at 31 December 2018, 2019 and 2020, we had 12, 11 and 13 commercial projects, with contracted GFA of 0.3 million sq.m., 0.3 million sq.m. and 0.3 million sq.m., respectively.

We seek to expand our business through multiple channels. For example, we plan to continue to leverage our existing business relationship with Ronghui Group for organic growth. Moreover, we plan to pursue new projects from Independent Third Parties by capitalising on our brand and diversified service offerings and high quality services. In addition, we intend to explore selective strategic investment and acquisition opportunities. Please refer to the section headed “Business—Our Strategies—Further expand our business operations through strategic acquisitions and investments” in this document.

Our Business Mix

Our results of operations are affected by our business mix. During the Track Record Period, we operated two business lines, namely property management services and commercial operational services, which have different gross profit margins. Our gross profit margins of different business lines depend on types of services provided, fees received and costs borne by us under different contractual arrangements. Types of services provided under property management services business line and commercial operational services business line vary in gross profit margin and their fluctuations in gross profit margin or changes in the revenue contribution affect the overall gross profit margin of each business line. Any change in the structure of revenue contribution from our business lines or change in gross profit margin of any of such business lines may have a corresponding impact on our overall gross profit margin.

The table below sets forth the gross profit contribution by each business line and the respective gross profit margins for the periods indicated:

For the year ended 31 December 2018 2019 2020 Gross Gross Gross Gross profit Gross profit Gross profit profit margin profit margin profit margin RMB’000 % RMB’000 % RMB’000 %

Property management services .... 29,911 18.2 35,175 18.8 52,497 25.8 Commercial operational services . . 16,341 47.9 22,670 60.6 23,347 61.3

Total ...... 46,252 23.3 57,845 25.8 75,844 31.4

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In general, the gross profit margins of our commercial operational services were higher than those of our property management services which was primarily because (i) commercial operational services are less labour-intensive than property management services; and (ii) unlike general property management services, the provision of services in relation to commercial properties is not subject to price control and therefore we may charge a relatively higher service fee as compared to general property management services, please refer to the section headed “Regulatory Overview—Regulations on Property Management Service—Regulations on the Fees Charged by the Property Management Enterprise” in this document. For further details, please refer to the section headed “—Results of Operations—Gross Profit and Gross Profit Margin” in this document.

Our Brand Positioning and Pricing of Our Services

Our results of operations are affected by our ability to maintain or increase the fee rates we charge for our services, which is in part affected by our brand recognition, industry position and government regulations with respect to property management services. We intend to further enhance our brand recognition by providing quality property management services and commercial operational services, and strengthen our brand image to expand our service engagements and to charge premium service fee rates.

For our property management services, we generally price our services based on a number of factors, including (i) local regulatory requirements or guidelines for property management fees; (ii) types, sizes and locations of the properties; (iii) the prevailing market price of the local market; (iv) our estimated costs and expenses; (v) the profiles of property owners and residents; and (vi) the scope and quality of our services. Under the property management service agreements, we may raise property management fees upon renewal of the agreements as approved by a requisite number of property owners in accordance with relevant PRC laws and regulations. Please refer to the section headed “Business—Property Management Services—Our Pricing Policy” in this document.

For our commercial operational services to tenants, we generally price our services with reference to, among others, (i) business scope of the tenant; (ii) location of the commercial property; (iii) positioning of the commercial property; (iv) GFA of the shop leased by the tenant; and (v) brand value of the tenant.

For our commercial operational services to property developers and property owners, we generally price our market research and positioning, tenant sourcing and pre-opening preparatory services, as well as business management services with reference to, among others, (i) brand, size and location of the commercial property; (ii) availability of utilities; (iii) the complication in tenant sourcing; and (iv) the service period.

In determining our pricing, we aim to achieve a balance between pricing our projects competitively while ensuring an attractive profit margin. Failure to achieve a proper balance of relevant factors in determining our pricing could materially and adversely affect our financial condition and results of operations.

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The sensitivity analysis below demonstrates the impact of the hypothetical decrease in average property management fees for property management services on our profit, while all other factors remain unchanged:

For the Year ended 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Profit for the year ...... 18,493 35,587 54,178 Assuming 5% decrease in our average property management fees . Hypothetical impact on our profit before tax ...... (6,268) (7,074) (7,422) Hypothetical impact on our profit for the year ...... (5,066) (5,901) (6,168) Assuming 10% decrease in our average property management fees . Hypothetical impact on our profit before tax ...... (12,536) (14,149) (14,844) Hypothetical impact on our profit for the year ...... (10,131) (11,803) (12,336)

Our Ability to Mitigate the Impact of Rising Labour Cost

Staff costs constitute a substantial portion of our cost of sales. Staff costs in our cost of sales amounted to RMB97.3 million, RMB107.4 million and RMB106.0 million for the years ended 31 December 2018, 2019 and 2020, respectively, representing approximately 63.7%, 64.5% and 64.0%, respectively, of our total cost of sales for the respective period. We have also outsourced certain labour-intensive services and specialised services, primarily including cleaning, gardening, garbage disposal and repair and maintenance services, to subcontractors while maintaining close supervision of their services to ensure service quality. In 2018, 2019 and 2020, we incurred outsourcing expenses of RMB26.9 million, RMB32.5 million and RMB34.6 million, respectively, representing 17.7%, 19.5% and 20.9%, respectively, of our cost of sales for the respective period.

Our business is labour-intensive and the supply of experienced personnel in the market is limited. Competition in the labour market for personnel with related expertise and experience may increase the salary level and correspondingly, our costs associated with hiring and retaining such personnel, and in turn adversely affect our results of operations.

To cope with rising costs in relation to staff costs, we have implemented a number of cost-saving measures, including implementing technology initiatives and automation efforts to reduce our reliance on manual labour. Our ability to mitigate the impact of the rising labour cost will affect our financial position and performance.

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For illustration purpose only, we set out below a sensitivity analysis of our profit for the year with reference to the fluctuation of our staff costs and outsourcing costs in our cost of sales during the Track Record Period. The table below demonstrates the impact of a hypothetical increase in our staff costs and outsourcing costs on our profit, while all other factors remain unchanged: For the Year ended 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Profit for the year ...... 18,493 35,587 54,178 Assuming 5% increase in our staff costs and outsourcing costs Hypothetical impact on our profit before tax ...... (6,211) (6,993) (7,031) Hypothetical impact on our profit for the year ...... (5,020) (5,834) (5,843) Assuming 10% increase in our staff costs and outsourcing costs Hypothetical impact on our profit before tax ...... (12,423) (13,987) (14,062) Hypothetical impact on our profit for the year ...... (10,040) (11,668) (11,686)

Competition

The property management industry in the PRC is highly fragmented and competitive, with a few sizeable companies and numerous small-sized market participants. We primarily compete against large national, regional and local property management and commercial operational service companies. We believe our core competitiveness lies in factors including quality of services, business operation, price, financial resources, brand recognition and reputation. According to CIA, we ranked 55th among the 2020 Top 100 Property Management Companies in China and ranked 50th among the 2021 Top 100 Property Management Companies in China among the 2020 Top 100 Property Management Companies in China. We also ranked 36th among the 2020 Top 100 Property Management Companies in terms of total GFA under management of large-scale integrated property, 10th among the 2020 Top 100 Property Management Companies in terms of total GFA under management of large-scale integrated property in the Southwest Region, and fourth among the 2020 Top 100 Property Management Companies in terms of total GFA under management of large-scale integrated property in Chongqing. Our ability to effectively compete with these competitors and maintain or improve our market position depends on our ability to differentiate ourselves from our competitors through ensuring our service quality and consistency. In addition, our ability to maintain our industry reputation will affect our ability to source new and renew existing property management and commercial operational service contracts and expand our GFA under management. If we fail to source new and renew existing property management and commercial operational service contracts and expand our GFA under management, our business, financial condition and results of operations may be adversely affected.

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SIGNIFICANT ACCOUNTING POLICIES, ESTIMATES AND JUDGEMENTS

We have identified certain accounting policies that are significant to the preparation of our combined financial statements. Some of our accounting policies involve subjective assumptions and estimates, as well as complex judgements relating to accounting items. We set out below some of the accounting policies and estimates that we believe are of importance to us or involve the most significant estimates and judgements used in the preparation of our financial statements. Our significant accounting policies, judgements and estimates, which are important for understanding our financial condition and results of operations, are set out in further details in Notes 2 and 3 to the Accountants’ Report in Appendix I to this document.

Revenue Recognition

We provide general property management services, non-property owner value-added services, community value-added services and commercial operational services. Revenue from providing services is recognised in the accounting period in which the services are rendered.

General property management services

For general property management services, we bill a fixed amount for services provided on a monthly basis and recognises as revenue in the amount to which we have a right to invoice and that corresponds directly with the value of performance completed.

For general property management services income from properties managed under lump-sum basis, where the Group acts as a principal and is primarily responsible for providing property management services to property owners, we recognise the fee received or receivable from property owners as our revenue and all related property management costs as our cost of services. For property management services income from properties managed under commission basis, we recognise the commission, which is calculated by certain percentage of the total property management fee received or receivable from the property units, or total property management cost incurred or accrual by the property units, as our revenue for arranging and monitoring the services as provided by other suppliers to the property owners.

Value-added services to non-property owners

Value added services to non-property owners include mainly i) sales centre management services, which are billed and settled based on actual level of services provided at pre-determined price and revenue is recognised when such services are provided and ii) property delivery related and other consulting services with property developers which are billed on monthly basis and revenue is recognised when the services are provided.

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Community value-added services

For community value-added services, revenue is recognised when the related community value-added services are rendered. Community value-added services are normally billable immediately upon the services are rendered.

Commercial operational services

For commercial operational services, we bill a fixed amount for services provided on a monthly basis and recognise as revenue in the amount to which we have a right to invoice and that corresponds directly with the value of performance completed.

Joint Venture

A joint venture is a type of joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of such arrangement. Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions relating about relevant activities require the unanimous consent of the parties sharing control.

In combined financial statements, an investment in a joint venture is initially recognised at cost and subsequently accounted for using the equity method.

Under the equity method, our interest in the joint venture is carried at cost and adjusted for the post-acquisition changes in our share of the joint venture’s net assets less any identified impairment loss, unless it is classified as held for sale (or included in a disposal group that is classified as held for sale). The profit or loss for the year includes our share of the post-acquisition, post-tax results of the joint venture for the year, including any impairment loss on the investment in joint venture recognised for the year. Our other comprehensive income for the year includes its share of the joint venture’s other comprehensive income for the year.

Provision for impairment of trade and other receivables

We make allowances on trade and other 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.

Where the expectation is different from the original estimate, such difference will impact the carrying amount of trade and other receivables and provision for impairment in the periods in which such estimate has been changed.

As at 31 December 2018, 2019 and 2020, the carrying amounts of trade and other receivables are RMB314.3 million, RMB412.1 million and RMB471.4 million, respectively. Details of the provision for impairment of trade and other receivables are set out in Note 18 to the Accountants’ Report as set out in Appendix I to this document.

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Current and deferred income taxes

As detailed in Note 9 to the Accountants’ Report in Appendix I to this document, we are subject to enterprise income tax in the PRC. Judgement 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 tax provisions in the period in which such determination is made.

Deferred income tax assets relating to certain temporary differences and tax losses are recognised when management considers to be probable that future taxable profit will be available against which the temporary differences or tax losses can be utilised. The outcome of their actual utilisation may be different.

ADOPTION OF HKFRS 9, HKFRS 15 AND HKFRS 16

Our historical financial information during the Track Record Period has been prepared based on the underlying financial statements, in which HKFRS 9 “Financial Instruments” and HKFRS 15 “Revenue from contracts with customers” and HKFRS 16 “Leases” have been applied consistently throughout the Track Record Period. As compared to HKAS 39, HKAS 18 and HKAS 17, the adoption of HKFRS 9, HKFRS 15 and HKFRS 16 did not have a significant impact on our financial position, performance or key financial ratios during the Track Record Period.

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RESULTS OF OPERATIONS

The table below sets forth a summary of our combined statements of profit or loss and other comprehensive income for the periods indicated: For the year ended 31 December 2018 2019 2020 %of %of %of total total total RMB’000 revenue RMB’000 revenue RMB’000 revenue

Revenue ...... 198,905 100.0 224,215 100.0 241,351 100.0 Cost of sales ...... (152,653) (76.7) (166,370) (74.2) (165,507) (68.6)

Gross profit ...... 46,252 23.3 57,845 25.8 75,844 31.4 Other losses/gains, net . (1,006) (0.5) 5,580 2.5 16,690 6.9 Administrative expenses (22,553) (11.4) (21,146) (9.4) (26,467) (11.0) [REDACTED]-related expenses ...... ––––[REDACTED][REDACTED]

Operating profit...... 22,693 11.4 42,279 18.9 64,986 26.9 Share of results of a joint venture ...... 14 0 86 0 99 0 Finance income ...... 221 0.1 302 0.1 133 0.1 Finance costs...... (45) 0 (8) 0 (25) 0

Finance income, net .... 176 0.1 294 0.1 108 0.1

Profit before income tax 22,883 11.5 42,659 19.0 65,193 27.0 Income tax expense .... (4,390) (2.2) (7,072) (3.1) (11,015) (4.6)

Profit and total comprehensive income for the year . . 18,493 9.3 35,587 15.9 54,178 22.4

Profit and total comprehensive income attributable to:...... Equity holders of the Company ...... 17,653 8.9 33,360 14.9 50,520 20.9 Non-controlling interests ...... 840 0.4 2,227 1.0 3,658 1.5

18,493 9.3 35,587 15.9 54,178 22.4

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KEY COMPONENTS OF OUR COMBINED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

Revenue

During the Track Record Period, we generated revenue from the following two business lines:

• property management services business line, which primarily includes (i) general property management services; (ii) value-added services to non-property owners; and (iii) community value-added services. Our revenue generated from property management services business line contributed approximately 82.8%, 83.3% and 84.2% of our total revenue in 2018, 2019 and 2020, respectively; and

• commercial operational services business line, which primarily includes (i) commercial operational services to tenants; and (ii) commercial operational services to property developers and property owners. Our revenue generated from commercial operational services business line contributed approximately 17.2%, 16.7% and 15.8% of our total revenue in 2018, 2019 and 2020, respectively.

For the year ended 31 December 2018 2019 2020 (RMB’000) (%) (RMB’000) (%) (RMB’000) (%)

Property management services ...... 164,792 82.8 186,785 83.3 203,279 84.2 Commercial operational services ...... 34,113 17.2 37,430 16.7 38,072 15.8

Total ...... 198,905 100.0 224,215 100.0 241,351 100.0

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Property Management Services Business Line

The table below sets forth a breakdown of our total revenue from property management services by service category, both in absolute amount and as a percentage of total revenue generated from property management services, for the years indicated: For the year ended 31 December 2018 2019 2020 (RMB’000) (%) (RMB’000) (%) (RMB’000) (%)

General property management services .... 125,361 76.1 141,485 75.7 148,442 73.0 Value-added services to non-property owners .... 22,967 13.9 26,521 14.2 28,313 13.9 Community value-added services ...... 16,464 10.0 18,779 10.1 26,524 13.1

Total ...... 164,792 100.0 186,785 100.0 203,279 100.0

General Property Management Services

Revenue from our general property management services, which mainly include cleaning, security, gardening and repair and maintenance services, experienced continual growth during the Track Record Period. Our total GFA under management under property management services business was approximately 5.7 million sq.m., 6.0 million sq.m. and 6.4 million sq.m., as at 31 December 2018, 2019 and 2020, respectively. In 2018, 2019 and 2020, our revenue generated from general property management services amounted to RMB125.4 million, RMB141.5 million and RMB148.4 million, respectively, representing 76.1%, 75.7% and 73.0% of our total property management service revenue for the same periods, respectively.

The table sets forth a breakdown of our total GFA under management by geographic region as at the dates indicated, and our revenue from general property management services by geographic region for the years indicated. As at/for the year ended 31 December 2018 2019 2020 GFA under GFA under GFA under management Revenue management Revenue management Revenue (sq.m. in (sq.m. in (sq.m. in thousands) (RMB’000) (%) thousands) (RMB’000) (%) thousands) (RMB’000) (%)

Chongqing...... 4,092.7 92,721 74.0 4,431.9 105,715 74.7 4,689.5 111,166 74.9 Fuzhou, Fujian Province ...... 717.4 14,832 11.8 674.3 14,661 10.4 749.7 16,644 11.2 Jinan, Shandong Province ...... 838.6 16,516 13.2 838.6 19,814 14.0 838.6 19,335 13.0 Wuhu, Anhui Province ...... 77.9 1,292 1.0 77.9 1,295 0.9 77.9 1,297 0.9

Total...... 5,726.6 125,361 100.0 6,022.7 141,485 100.0 6,355.7 148,442 100.0

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The table below sets forth the average property management fee of the properties we manage by geographical locations for the years indicated.

For the year ended 31 December 2018 2019 2020 RMB per sq.m. per month

Chongqing ...... 2.12 2.20 2.22 Jinan, Shandong Province ...... 2.49 2.39 2.39 Fuzhou, Fujian Province ...... 2.38 2.49 2.59 Wuhu, Anhui Province ...... 2.26 2.26 2.26 Overall ...... 2.20 2.25 2.28

Value-added Services to Non-property Owners

We also provide a series of value-added services to non-property owners, primarily property developers. In 2018, 2019 and 2020, our revenue generated from value-added services to non-property owners amounted to RMB23.0 million, RMB26.5 million and RMB28.3 million, respectively, representing 13.9%, 14.2% and 13.9% of our total property management service revenue for the same periods, respectively. The following table sets forth a breakdown of our property management service revenue generated from each category of the value-added services to non-property owners for the periods indicated.

For the year ended 31 December 2018 2019 2020 (RMB’000) (%) (RMB’000) (%) (RMB’000) (%)

Preliminary design and planning consultancy services ...... 94 0.4 667 2.5 1,232 4.4 Pre-delivery inspection services ...... 648 2.8 1,409 5.3 2,971 10.5 Repair and maintenance services ...... 1,616 7.0 1,690 6.4 2,412 8.5 Sales centre management services ...... 9,448 41.2 9,949 37.5 11,423 40.3 Additional tailor-made services ...... 11,161 48.6 12,806 48.3 10,275 36.3

Total ...... 22,967 100.0 26,521 100.0 28,313 100.0

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Community Value-added Services

In 2018, 2019 and 2020, our revenue generated from community value-added services amounted to RMB16.5 million, RMB18.8 million and RMB26.5 million, respectively, representing 10.0%, 10.1% and 13.1% of our total property management services revenue for the same periods, respectively. The following table sets forth a breakdown of our revenue generated from each category of community value-added services for the periods indicated.

For the year ended 31 December 2018 2019 2020 (RMB’000) (%) (RMB’000) (%) (RMB’000) (%)

Temporary car park management services . . 9,668 58.7 11,046 58.8 12,883 48.6 Sales assistance services . . – – 491 2.6 6,409 24.2 Common area value-added services . . 6,427 39.0 6,950 37.0 6,248 23.6 Home-living services .... 369 2.3 292 1.6 984 3.6

Total ...... 16,464 100.0 18,779 100.0 26,524 100.0

Commercial Operational Services Business Line

We provide commercial operational services to a diversified portfolio of commercial properties, including cultural tourism properties (including hot spring resorts), urban commercial towns, shopping centres, theme streets, neighbourhood centres, shopping streets and community stores. We began to provide commercial operational services to commercial properties in 2012. In 2018, 2019 and 2020, our revenue generated from commercial operational services amounted to RMB34.1 million, RMB37.4 million and RMB38.1 million, respectively, representing 17.2%, 16.7% and 15.8% of our total revenue for the respective period. As at 31 December 2018, 2019 and 2020, our total contracted GFA under commercial operational services segment was 0.3 million sq.m., 0.3 million sq.m. and 0.3 million sq.m., respectively.

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The table below sets forth a breakdown of our total revenue from commercial operational services by service category for the years indicated:

For the year ended 31 December 2018 2019 2020 (RMB’000) (%) (RMB’000) (%) (RMB’000) (%)

Commercial operational services to tenants business management services ...... 33,831 99.2 37,430 100.0 31,836 83.6 Commercial operational services to property developers and property owners market research and positioning services . . . – 0.0 – 0.0 1,211 3.2 tenant sourcing services . . 282 0.8 – 0.0 2,478 6.5 pre-opening preparatory services ...... – 0.0 – 0.0 2,547 6.7

Subtotal ...... 282 0.8 – 0.0 6,236 16.4

Total ...... 34,113 100.0 37,430 100.0 38,072 100.0

During the Track Record Period, a majority of our revenue from commercial operational services business line was derived from commercial operational services provided to tenants, which accounted for approximately 99.2%, 100%, and 83.6% of our revenue from commercial operational services business line in 2018, 2019 and 2020, respectively.

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Revenue by Geographic Region for Commercial Operational Services Business Line

The table sets forth a breakdown of total contracted GFA by geographic region as at the dates indicated, and our revenue from commercial operational services by geographic region for the years indicated.

As at/for the year ended 31 December 2018 2019 2020 Contracted Contracted Contracted GFA Revenue GFA Revenue GFA Revenue (sq.m.) (RMB’000) (%) (sq.m.) (RMB’000) (%) (sq.m) (RMB’000) (%)

Chongqing...... 207,686.6 19,869 58.2 204,698.3 23,273 62.2 222,221.3 26,816 70.4 Jinan, Shandong Province ...... 41,172.0 7,857 23.0 41,172.0 8,880 23.7 44,172.3 7,873 20.7 Fuzhou, Fujian Province ...... 20,450.8 4,232 12.4 20,680.2 3,805 10.2 20,752.6 3,383 8.9 Wuhu, Anhui Province ...... 12,263.5 2,155 6.4 – 1,472 3.9–––

Total ...... 281,572.9 34,113 100.0 266,550.5 37,430 100.0 287,146.2 38,072 100.0

Cost of Sales

The table below sets forth a breakdown of our cost of sales by business line for the periods indicated:

For the year ended 31 December 2018 2019 2020 (RMB’000) (%) (RMB’000) (%) (RMB’000) (%)

Property management services ...... 134,881 88.4 151,610 91.1 150,782 91.1 Commercial operational services ...... 17,772 11.6 14,760 8.9 14,725 8.9

Total ...... 152,653 100.0 166,370 100.0 165,507 100.0

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Our cost of sales consists of (i) staff costs, including salaries and wages, social insurance and housing fund expenses and staff welfare; (ii) outsourcing expenses; (iii) utility expenses; (iv) costs of materials; (v) advertising costs; (vi) depreciation and amortisation; and (vii) other expenses. The table below sets forth a breakdown of our total cost of sales for the periods indicated:

For the year ended 31 December 2018 2019 2020 (RMB’000) (%) (RMB’000) (%) (RMB’000) (%)

Total cost of sales Staff costs ...... 97,307 63.7 107,389 64.5 106,003 64.0 Outsourcing expenses . . . 26,922 17.7 32,478 19.5 34,620 20.9 Utility expenses ...... 8,594 5.6 8,458 5.1 7,380 4.5 Costs of materials ...... 6,191 4.1 7,996 4.8 6,320 3.8 Advertising costs ...... 7,639 5.0 4,519 2.7 5,594 3.4 Depreciation and Amortisations ...... 1,551 1.0 1,306 0.8 785 0.5 Other expenses ...... 4,449 2.9 4,224 2.6 4,805 2.9

Total ...... 152,653 100.0 166,370 100.0 165,507 100.0

During the Track Record Period, key factors affecting our cost of sales under both property management services business line and commercial operational services business line were (i) staff costs and (ii) outsourcing expenses.

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Gross Profit and Gross Profit Margin

Our gross profit in 2018, 2019 and 2020 amounted to RMB46.3 million, RMB57.8 million and RMB75.8 million, respectively. During the same periods, we recorded our overall gross profit margin of 23.3%, 25.8% and 31.4%, respectively. The table below sets forth a breakdown of our gross profit and gross profit margin by business line for the periods indicated:

For the year ended 31 December 2018 2019 2020 Gross Gross Gross Gross profit Gross profit Gross profit profit margin profit margin profit margin (RMB’000) (%) (RMB’000) (%) (RMB’000) (%)

Property management services ...... 29,911 18.2 35,175 18.8 52,497 25.8 Commercial operational services ...... 16,341 47.9 22,670 60.6 23,347 61.3

Total ...... 46,252 23.3 57,845 25.8 75,844 31.4

Our overall gross profit margins are affected by the gross profit margin for each of our business lines, as well as our business mix. Types of services provided under property management services business line and commercial operational services business line vary in gross profit margin and their fluctuations in gross profit margin or changes in the revenue contribution affect the overall gross profit margin of each business line. Any change in the structure of revenue contribution from our business lines or change in gross profit margin of any of such business lines may have a corresponding impact on our overall gross profit margin.

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Other Losses/Gains, net

Our other losses or gains consist of (i) (loss)/gain on fair value changes of financial assets at fair value through profit or loss in relation to our securities investment; (ii) gain on sales of financial assets at fair value through profit or loss in relation to the disposal of our securities investment; (iii) dividend income; (iv) government subsidies in relation to our employment policies aimed at stabilising the workforce; (v) loss on disposal of property, plant and equipment mainly in relation to the scrapping of our equipment such as computers and air conditioners; and (vi) others such as input VAT awarded by tax authorities or other loss such as provision for contingent liabilities.

For the year ended 31 December 2018 2019 2020 (RMB’000) (RMB’000) (RMB’000)

(Loss)/gain on fair value changes of financial assets at fair value through profit or loss ...... (1,563) 4,411 – Gain on sales of financial assets at fair value through profit or loss . . . – – 14,887 Dividend income ...... 279 299 416 Government grants ...... 197 537 1,495 Loss on disposal of property, plant and equipment ...... (21) (57) (13) Others ...... 102 390 (95)

Total ...... (1,006) 5,580 16,690

Administrative Expenses

Our administrative expenses consist of (i) salaries and wages for our administrative and management personnel, including employment-related contributions; (ii) office and operational expenses; (iii) taxes and surcharges; (iv) other professional service fees unrelated to the [REDACTED]; (v) business hospitality expenses; (vi) provision for/(reversal) of impairment loss representing on trade and other receivables; (vii) depreciation and amortisation expenses representing depreciation of office equipment and amortisation of intangible assets and long-term deferred-expenses; (viii) transport, vehicles and travel expenses; and (ix) other miscellaneous administrative expenses.

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The table below sets forth a breakdown of our administrative expenses for the periods indicated:

For the year ended 31 December 2018 2019 2020 RMB’000 % RMB’000 % RMB’000 %

Salaries and wages and employment-related contributions ...... 12,556 55.7 16,779 79.3 18,376 69.4 Office and operational expenses ...... 2,566 11.4 3,204 15.1 2,545 9.6 Taxes and surcharges .... 1,653 7.3 1,757 8.3 1,750 6.6 Professional service fees . 516 2.3 379 1.8 1,102 4.2 Business hospitality expenses ...... 893 4.0 694 3.3 835 3.2 Provision for/(reversal) of impairment loss on trade and other receivables ...... 3,279 14.5 (3,218) (15.2) 808 3.1 Depreciation and amortisation ...... 284 1.2 372 1.8 663 2.5 Transport, vehicles and travel expenses ...... 556 2.5 550 2.6 280 1.1 Others ...... 250 1.1 629 3.0 108 0.3

Total ...... 22,553 100.0 21,146 100.0 26,467 100.0

Share of Results of a Joint Venture

During the Track Record Period, we held 50% equity interest in Funeng Ronghui, a company mainly engaged in providing property management services. Our share of results of this joint venture was approximately RMB14,000, RMB86,000 and RMB99,000 in 2018, 2019 and 2020, respectively.

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Finance Income, net

Our net finance income mainly includes (i) finance income of the interest income from the cash balance in our bank accounts; and (ii) finance costs such as charges for payment platforms. The table below sets forth the components of our net finance income for the periods indicated:

For the year ended 31 December 2018 2019 2020 RMB’000 % RMB’000 % RMB’000 %

Finance income ...... 221 125.6 302 102.7 133 123.1 Finance costs ...... (45) (25.6) (8) (2.7) (25) (23.1))

Total ...... 176 100.0 294 100.0 108 100.0

Income Tax Expenses

Our income tax expense mainly comprises the current and deferred income tax in the PRC. The table below sets forth the components of our income tax expenses for the periods indicated:

For the year ended 31 December 2018 2019 2020 RMB’000 % RMB’000 % RMB’000 %

Current income tax ..... 4,056 92.4 5,307 75.0 11,830 107.4 Under provision of prior years ...... 80 1.8–––– Deferred tax ...... 254 5.8 1,765 25.0 (815) (7.4)

Total ...... 4,390 100.0 7,072 100.0 11,015 100.0

In 2018, 2019 and 2020, our effective tax rates were approximately 19.2%, 16.6% and 16.9%, respectively. Our effective income tax rates during the Track Record Period were lower than the Enterprise Income Tax (the “EIT”) rate of 25.0%, primarily because (i) certain of our subsidiaries and branches in Chongqing enjoyed the preferential tax rate of 15% for the Large-scale Development of the Western Region in China during the Track Record Period; and (ii) certain of our subsidiaries and branches enjoyed the preferential tax rate for micro and small enterprises.

We make our annual tax filings in accordance with the EIT Law, which provides that the annual tax filings for the year (the “EIT Annual Tax Filing”) is made and any final tax payment is settled within the first five months after the end of that year. We had current income tax expenses in the amount of RMB4.1 million, RMB5.3 million and RMB11.8 million in 2018, 2019 and 2020, respectively, totaling to an amount of approximately RMB21.2 million. We paid income tax of RMB4.2 million, RMB7.5 million and RMB2.7 million in 2018, 2019 and 2020, respectively, totally to an amount of approximately RMB14.4 million. Our current income tax

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In addition, before the adoption of the Accrual Basis (as defined below) for tax computation in the preparation of the EIT Annual Tax Filing for 2018, 2019 and 2020, some of our subsidiaries (the “Relevant Subsidiaries”) calculated taxes based on the amounts of property management fees they received and relevant expenses that it had paid (the “Cash Basis”). The Relevant Subsidiaries used the Cash Basis in tax computation because it would be practically convenient to provide relevant documentary evidence to the relevant tax authorities if requested. Pursuant to the relevant PRC requirements, accounts to be filed for income tax computation purpose should be, in principle, determined based on when the revenue of delivery of goods or rendering of services to customer is earned (the “Accrual Basis”), regardless of the timing of payment or collections; and for value-added tax (the “VAT”) computation purpose, it should be determined on the basis of the occurrence of the taxable activities and the earlier of payments being received by the Relevant Subsidiaries or the Relevant Subsidiaries having achieved the basis upon which it would be entitled to such payments. We identified this issue in preparing our combined financial statement for the [REDACTED] and we proactively consulted with the relevant PRC tax authority and made an one-off tax adjustment in the amount of RMB1.6 million mainly in relation to the timing difference in tax computation of 2018, 2019 and 2020 for EIT, VAT and other tax surcharge which was fully settled in June 2021.

We had no tax payment outstanding for the Track Record Period as at the date of this document. Considering that (i) as confirmed by our Directors, we have adopted the Accrual Basis for tax computation in EIT Annual Tax Filings starting from our EIT Annual Tax Filing for 2021; (ii) we have made the relevant adjustments for the abovementioned tax filing matters and no tax payment was outstanding; (iii) we have obtained the confirmation letters from the relevant tax authorities which, as advised by our PRC Legal Advisors, Commerce & Finance Law Offices, are the competent authorities to issue such confirmation letters, confirming that there was no illegal or non-compliance record in relation to tax for the Relevant Subsidiaries during the Track Record Period; (iv) the fact that our Directors have confirmed that, as at the Latest Practicable Date, we have not received any tax penalty in relation to the above-mentioned tax filing matters; (v) as advised by the Tax Advisors, Zhitong (Fujian) Registered Tax Agents Co., Ltd., the abovementioned difference in tax payment was mainly caused by the change of accounting policies and there was no material illegal or non-compliance activity identified in relation to the tax payment of the Relevant Subsidiaries, and the risk of the relevant PRC tax authorities imposing penalty on us due to the abovementioned tax filing matter is very low; and (vi) the fact that our Controlling Shareholders [have agreed] to indemnify us for all claims, costs, expenses, fines and/or penalties (if any) and losses incurred as a result of the above-mentioned tax filing matters, we were of the view that the tax filing matters discussed above were not material issues and would not have a material impact on our business, financial performance and results of operations.

During the Track Record Period and up to the Latest Practicable Date, save as regular random inspection by the relevant tax authorities, we 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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REVIEW OF HISTORICAL RESULTS OF OPERATIONS

Year Ended 31 December 2020 Compared to Year Ended 31 December 2019

Revenue

Our revenue increased by approximately 7.6% from RMB224.2 million in the year ended 31 December 2019 to RMB241.4 million in the year ended 31 December 2020. This increase was driven by an increase in revenue from our property management services business line, and to a lesser extent, an increase in revenue from our commercial operational services business line.

Revenue from Property Management Services

Revenue from property management services increased by 8.8% from RMB186.8 million in the year ended 31 December 2019 to RMB203.3 million in the year ended 31 December 2020, primarily attributable to:

• an increase in revenue from general property management services by 4.9% from RMB141.5 million in the year ended 31 December 2019 to RMB148.4 million in the year ended 31 December 2020, which was primarily attributable to (i) the increase in our aggregate GFA under management from approximately 6.0 million sq.m. as at 31 December 2019 to approximately 6.4 million sq.m. as at 31 December 2020 through organic growth and (ii) the increase in our weighted average monthly property management fee from RMB2.25 per sq.m. in 2019 to RMB2.28 per sq.m. in 2020;

• an increase in revenue from value-added services to non-property owners by 6.8% from RMB26.5 million in 2019 to RMB28.3 million in 2020, which was primarily attributable to (i) the increase in our revenue for preliminary design and planning consultancy services and pre-delivery inspection services as a result of (a) the increase in GFA delivered to us from Ronghui Group in 2020; (b) recognition of preliminary design and planning consultancy services revenue in 2020 for three projects to be delivered in 2021; and (c) the increase in service fee rate; (ii) the increase in our revenue for repair and maintenance services in line with our growth of the number of projects under our management; and (iii) the increase in revenue for our sales centre management services as a result of an increase in the service area of the sales centres managed by us and the increase in our service fee rate, partially offset by the fall in our revenue for additional tailored services primarily as a result of re-delivery of certain public facilities back to the government and reduction in service area of certain municipal roads; and

• an increase in revenue from community value-added services by 41.2% from RMB18.8 million in 2019 to RMB26.5 million in 2020, which was primarily attributable to the increase in revenue generated from sales assistance services launched in 2019. Such rise in sales assistance services was primarily related to the increase in the number of car parking lots sales in 2020.

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Revenue from Commercial Operational Services

Revenue from commercial operational services increased by 1.7% from RMB37.4 million in the year ended 31 December 2019 to RMB38.1 million in the year ended 31 December 2020, which was primarily attributable to an increase in revenue of RMB6.2 million from commercial operational services to property developers and property owners as we began to recognise revenue from market research and positioning services, tenant sourcing services and pre-opening preparatory services provided to Ronghui Hot Spring Town G1 Ronghui Plaza Shopping Centre which is planned to open in 2021 as well as Jinan 1904 Street; partially offset by a decrease by 14.9% from RMB37.4 million in 2019 to RMB31.8 million in 2020 for commercial operational services to tenants primarily because (i) we ceased to provide commercial operational services to projects in Wuhu in June 2019; (ii) certain community stores managed by us were sold by the property owners; and (iii) the decrease in commercial operational fee rate and occupancy rate due to the COVID-19 outbreak.

Cost of Sales

Our cost of sales decreased by approximately 0.5% from RMB166.4 million in the year ended 31 December 2019 to RMB165.5 million in the year ended 31 December 2020.

Cost of Sales for Property Management Services

Cost of sales for property management services business line decreased by 0.5% from RMB151.6 million in the year ended 31 December 2019 to RMB150.8 million in the year ended 31 December 2020, which was primarily attributable to (i) the decrease in staff costs despite a rise in revenue as we optimised the human resources structure and reduced the number of front line staff for basic services and the implementation of favourable policies《關於階段性減免企業社會保險費 ( 的通知》(人社部發[2020]11號)) as a result of the COVID-19 outbreak for the reduction and waiver of social insurance contribution. If we do not enjoy such favourable policies in the future, our gross profit margin may be negatively affected; (ii) a decrease in costs of materials as a result of COVID-19 personnel physical movement restriction leading to a reduction in the scale of our on-site work; and (iii) the decrease in electricity price by stages according to the relevant policies, which were partially offset by the increase in sub-contracting costs as a result of our human resources structure optimisation.

Cost of Sales for Commercial Operational Services

Cost of sales for commercial operational services business line decreased by 0.2% from RMB14.8 million in the year ended 31 December 2019 to RMB14.7 million in the year ended 31 December 2020, primarily due to the fact that we ceased to provide commercial operational services to projects in Wuhu in June 2019.

Gross Profit and Gross Profit Margin

As a result of the foregoing, our gross profit increased by approximately 31.1% from RMB57.8 million in the year ended 31 December 2019 to RMB75.8 million in the year ended 31 December 2020.

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Our overall gross profit margin increased from 25.8% in the year ended 31 December 2019 to 31.4% in the year ended 31 December 2020, primarily reflecting the increases in gross profit margins of both property management services and commercial operational services.

Gross Profit Margin of Property Management Services

The gross profit margin of our property management services business line increased from 18.8% in the year ended 31 December 2019 to 25.8% in the year ended 31 December 2020. This increase was driven by (i) the decrease in staff costs as (a) we optimised the human resources structure and reduced the number of front line staff for basic services and (b) the implementation of favourable policies as a result of the COVID-19 outbreak for reduction and waiver of social insurance contribution; (ii) the decrease in electricity price by stages; and (iii) the rapid growth of our sales assistance services which have a relatively higher gross profit margin.

Gross Profit Margin of Commercial Operational Services

The gross profit margin of our commercial operational services business line increased from 60.6% in the year ended 31 December 2019 to 61.3% in the year ended 31 December 2020, primarily reflecting increases in gross profit margin of commercial operational services provided to property developers and owners from nil in the year ended 31 December 2019 to 71.5% in the year ended 31 December 2020, because we began to recognise revenue from market research and positioning services, tenant sourcing services and pre-opening preparatory services to Ronghui Hot Spring Town G1 Ronghui Plaza Shopping Centre which is planned to open in 2021 and Jinan 1904 Street.

Other (Losses)/Gains, Net

Our net other gains increased from RMB5.6 million in the year ended 31 December 2019 to RMB16.7 million in the year ended 31 December 2020. This increase was primarily due to the gain from sale of financial assets of RMB14.9 million as a result of the sale of our investment in listed securities.

Administrative Expenses

Our administrative expenses increased by approximately 25.2% from RMB21.1 million in the year ended 31 December 2019 to RMB26.5 million in the year ended 31 December 2020. This increase was primarily due to (i) the provision for impairment loss for our trade and other receivables; (ii) the increase in average salary and bonus of our management staff; and (iii) the engagement of professional parties for industry research, which were partially offset by a decrease of office expenses as we renovated our offices and replaced certain office supplies in 2019 which did not occur in 2020.

[REDACTED]-related Expenses

We recorded [REDACTED]-related expenses of RMB[REDACTED] in the year ended 31 December 2020 for the purpose of preparing for the [REDACTED].

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Share of Results of a Joint Venture

Our share of profit of a joint venture was RMB86,000 in 2019 and RMB99,000 in 2020, reflecting the profit of investment of Funeng Ronghui, in proportion to our equity interest in Funeng Ronghui.

Finance Income, Net

Our net finance income decreased from RMB0.3 million in the year ended 31 December 2019 to RMB0.1 million in the year ended 31 December 2020, primarily due to an increase in our provision of financial resources to related parties reducing our monthly average bank balance and interest income derived from such bank deposits.

Income Tax Expenses

Our income tax expenses increased by approximately 55.8% from RMB7.1 million in the year ended 31 December 2019 to RMB11.0 million in the year ended 31 December 2020. This increase was primarily attributable to our increased profit before tax.

Our effective tax rate increased from 16.6% in the year ended 31 December 2019 to 16.9% in the year ended 31 December 2020 which was relatively stable.

Profit and Total Comprehensive Income for the Year

As a result of the foregoing, our profit for the period increased by approximately 52.2% from RMB35.6 million in the year ended 31 December 2019 to RMB54.2 million in the year ended 31 December 2020.

Year Ended 31 December 2019 Compared to Year Ended 31 December 2018

Revenue

Our revenue increased by 12.7% from RMB198.9 million in the year ended 31 December 2018 to RMB224.2 million in the year ended 31 December 2019. This increase was driven by an increase in revenue from both our property management services and commercial operational services.

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Revenue from Property Management Services

Revenue from property management services increased by 13.3% from RMB164.8 million in the year ended 31 December 2018 to RMB186.8 million in the year ended 31 December 2019, primarily attributable to:

• an increase in revenue from general property management services by 12.9% from RMB125.4 million in the year ended 31 December 2018 to RMB141.5 million in the year ended 31 December 2019, which was primarily attributable to the increase in our total GFA under management over the same periods as a result of our business expansion. As at 31 December 2018 and 2019, our total GFA under management under the property management services business line was approximately 5.7 million sq.m. and 6.0 million sq.m., respectively. Our weighted average monthly property management fee increased from RMB2.20 per sq.m. in 2018 to RMB2.25 per sq.m. in 2019;

• an increase in revenue from value-added services to non-property owners by 15.5% from RMB23.0 million in the year ended 31 December 2018 to RMB26.5 million in the year ended 31 December 2019, which was primarily attributable to the increase in our revenue generated from additional tailor-made services given the increasing service areas and fee rates for the management of municipal roads and construction site; and

• an increase in revenue from community value-added services by 14.1% from RMB16.5 million in the year ended 31 December 2018 to RMB18.8 million in the year ended 31 December 2019, which was mainly attributable to (i) the increase in the rental of common areas for our common area value-added services, primarily due to the increase in new property delivery and occupancy rate. Such increase in revenue includes advertising income, entrance fee for renovation wastes cleaning companies and rental for telecommunications stations; (ii) the increase in our temporary car park management fee rate and the number of temporary car parking lots under our management since the increasing residential occupancy rate of the properties under management contributed to the increase in demand for temporary parking lots; and (iii) the increase in our sales assistance service fees primarily due to our newly launched car parking lots sales services in 2019.

Revenue from Commercial Operational Services

Revenue from commercial operational services increased by 9.7 % from RMB34.1 million in the year ended 31 December 2018 to RMB37.4 million in the year ended 31 December 2019, which was primarily attributable to: (i) the fact that we only began to provide substantial commercial operational services to Ronghui Xiliutuo Town from October 2018; and (ii) an increase in average management fee for our commercial operational services.

Cost of Sales

Our cost of sales increased by 9.0% from RMB152.7 million in the year ended 31 December 2018 to RMB166.4 million in the year ended 31 December 2019.

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Cost of Sales for Property Management Services

Cost of sales for property management services business line increased by 12.4% from RMB134.9 million in the year ended 31 December 2018 to RMB151.6 million in the year ended 31 December 2019, which was primarily attributable to (i) the increase in the number of our employees in line with our business expansion; (ii) the increase in the overall average salary level; and (iii) the increase in our sub-contracting costs in line with our business expansion.

Cost of Sales for Commercial Operational Services

Cost of sales for commercial operational services business line decreased by 17.0% from RMB17.8 million in the year ended 31 December 2018 to RMB14.8 million in the year ended 31 December 2019, primarily due to the decrease in advertising and promotion expenses as the commercial properties managed by us have become more established through our continuing commercial operational services.

Gross Profit and Gross Profit Margin

As a result of the foregoing, our gross profit increased by 25.1% from RMB46.3 million in the year ended 31 December 2018 to RMB57.8 million in the year ended 31 December 2019.

Gross Profit Margin of Property Management Services

The gross profit margin of our property management services business line increased from 18.2% in the year ended 31 December 2018 to 18.8% in the year ended 31 December 2019. This increase was driven by growth for value-added services which commands higher gross margin than general property management services.

Gross Profit Margin of Commercial Operational Services

The gross profit margin of our commercial operational services business line increased from 47.9% in the year ended 31 December 2018 to 60.6% in the year ended 31 December 2019, primarily reflecting the increase in gross profit margin of commercial operational services provided to tenants from 47.8% in the year ended 31 December 2018 to 60.6% in the year ended 31 December 2019, primarily due to (i) the increase in average management fee for our commercial operational services provided to tenants; and (ii) the decrease in advertising and promotion expenses as the commercial properties managed by us have become more established through our continuing commercial operational services.

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Other (Losses)/Gains, Net

We recorded net losses of RMB1.0 million in the year ended 31 December 2018 and net gains of RMB5.6 million in the year ended 31 December 2019. This increase was primarily due to a RMB4.4 million gain on fair value changes of financial assets at fair value in 2019 in connection with listed securities that we held.

Administrative Expenses

Our administrative expenses decreased by 6.2% from RMB22.6 million in the year ended 31 December 2018 to RMB21.1 million in the year ended 31 December 2019. This decrease was primarily due to our reversal of provision of impairment for trade and other receivables of RMB3.2 million primarily as a result of a decrease in the balance of trade receivables due from related parties in 2019.

Share of Results of a Joint Venture

Our share of profit of a joint venture was RMB14,000 in 2018 and RMB86,000 in 2019, reflecting the profit of investment of Funeng Ronghui, in proportion to our equity interest in Funeng Ronghui.

Finance Income, Net

Our net finance income increased from RMB0.2 million in the year ended 31 December 2018 to RMB0.3 million in the year ended 31 December 2019, primarily due to an increase in interest income resulted from an increase in our average monthly bank balance.

Income Tax Expense

Our income tax expense increased by 61.1% from RMB4.4 million in the year ended 31 December 2018 to RMB7.1 million in the year ended 31 December 2019. Our effective tax rate decreased from 19.2% in the year ended 31 December 2018 to 16.6% in the year ended 31 December 2019. The decrease was primarily because certain of our subsidiaries and branches began to enjoy the preferential tax rate for micro and small enterprises in 2019.

Profit and Total Comprehensive Income for the Year

As a result of the foregoing, our profit for the period increased by approximately 92.4% from RMB18.5 million in the year ended 31 December 2018 to RMB35.6 million in the year ended 31 December 2019.

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DESCRIPTION OF CERTAIN COMBINED BALANCE SHEET ITEMS

The table below sets forth a summary of our combined statements of financial position as at the dates indicated: As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Non-current assets Property, plant and equipment ...... 2,504 2,214 2,776 Intangible assets ...... 531 821 1,005 Investment in a joint venture ...... 1,014 1,100 1,199 Right-of-use assets ...... 322 29 1,184 Prepayment ...... – – 16 Deferred tax assets ...... 1,803 750 853

Total non-current assets ...... 6,174 4,914 7,033

Current assets Inventories ...... 864 713 572 Trade and other receivables ...... 314,345 412,063 471,372 Financial assets at fair value through profit or loss ...... 8,429 12,847 – Income tax recoverable ...... 620 2,794 842 Bank balances and cash ...... 92,827 45,997 74,733

Total current assets ...... 417,085 474,414 547,519

Current liabilities Contract liabilities ...... 37,172 47,273 52,511 Trade and other payables ...... 110,401 105,435 113,623 Lease liabilities ...... 332 23 246 Income tax liabilities ...... 1,754 1,698 8,889

Total current liabilities ...... 149,659 154,429 175,269

Net current assets ...... 267,426 319,985 372,250

Total assets less current liabilities .... 273,600 324,899 379,283

Non-current liabilities Lease liabilities ...... – – 918 Deferred tax liabilities ...... – 712 –

Net assets ...... 273,600 324,187 378,365

Equity Share capital ...... 252,231 265,912 265,912 Reserves ...... 11,036 44,396 94,916

Equity attributable to the equity holders of our Company ...... 263,267 310,308 360,828 Non-controlling interests ...... 10,333 13,879 17,537

Total equity ...... 273,600 324,187 378,365

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Property, Plant and Equipment

Our property, plant and equipment primarily consist of machinery, transportation, office equipment, and furniture. Our property, plant and equipment decreased from RMB2.5 million as at 31 December 2018 to RMB2.2 million as at 31 December 2019, and increased to RMB2.8 million as at 31 December 2020, primarily attributable to the depreciation in 2019 and our purchases of machinery and equipment for cleaning, entrance control, surveillance and air conditioning in our offices and the office renovation works in 2020.

Intangible Assets

Our intangible assets consist of our right of use for the softwares. Our intangible assets increased from RMB0.5 million as at 31 December 2018 to RMB0.8 million as at 31 December 2019, and it further increased to RMB1.0 million as at 31 December 2020, primarily attributable to the purchases of software for building our smart community, in particular the purchases of management fee collection system and centralised customer services hotline system.

Investment in a Joint Venture

Our investment in a joint venture represents our equity investment in Funeng Ronghui. Our investment in a joint venture increased from RMB1.0 million as at 31 December 2018 to RMB1.1 million as at 31 December 2019, and it further increased to RMB1.2 million as at 31 December 2020, primarily attributable to the increase in net profit generated by Funeng Ronghui which in turn increased our share of profits and balance of investment in a joint venture.

Right-of-use Assets

We had right-of-use assets of RMB0.3 million, RMB29,000 and RMB1.2 million as at 31 December 2018, 2019 and 2020, respectively, primarily reflecting (i) the properties we leased for sub-leasing in 2018 and 2019; and (ii) the property leased for our office in 2020.

Prepayment

We had prepayment of nil, nil and RMB16,000 as at 31 December 2018, 2019 and 2020, respectively, primarily reflecting prepayment for office renovation.

Deferred tax assets

Our deferred tax assets primarily arise from provision for impairment for trade and other receivables, deductible losses and fair value losses of our financial assets investments. Our deferred income tax assets decreased from RMB1.8 million as at 31 December 2018 to RMB0.8 million as at 31 December 2019, primarily due to the reversal in provision for impairment for trade and other receivables and fair value gain of our financial assets investments. Our deferred tax assets increased to RMB0.9 million as at 31 December 2020, primarily due to the increase in provision for estimated liabilities for litigation.

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Inventories

Our inventories are consumables for cleaning and other services. We had inventories of RMB0.9 million, RMB0.7 million and RMB0.6 million as at 31 December 2018, 2019 and 2020, respectively, the decrease in balances is primarily due to ordinary consumption.

Trade and Other Receivables

Trade Receivables

Trade receivables are amounts due from customers for provision of various services under property management services business line and commercial operational services business line. Our trade receivables decreased from RMB37.7 million as at 31 December 2018 to RMB34.9 million as at 31 December 2019, and then increased to RMB49.4 million as at 31 December 2020. The table below sets forth a breakdown of our trade receivables as at the dates indicated: As at 31 December 2018 2019 2020 RMB’000 % RMB’000 % RMB’000 %

Trade receivables from the related parties ...... 32,063 85.0 25,130 71.9 38,515 77.9 Trade receivables from Independent Third Parties ...... 11,310 30.0 11,715 33.6 13,412 27.1

Trade Receivables, gross . . 43,373 115.0 36,845 105.5 51,927 105.0

Less: Provision for impairment of trade receivables ...... (5,672) (15.0) (1,915) (5.5) (2,493) (5.0)

Trade Receivables, net .. 37,701 100.0 34,930 100.0 49,434 100.0

Our trade receivables from the Independent Third Parties increased from RMB11.3 million as at 31 December 2018 to RMB11.7 million as at 31 December 2019, further increased to RMB13.4 million as at 31 December 2020 generally in line with business expansion. Our trade receivables from related parties decreased from RMB32.1 million as at 31 December 2018 to RMB25.1 million as at 31 December 2019, primarily due to the settlement of trade receivables from our related parties in 2019. Our trade receivables from related parties further increased to RMB38.5 million as at 31 December 2020, which is generally in line with the increase in our transaction amount with related parties.

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Aging Analysis on Trade Receivables

The credit period of our trade receivables is normally within 30 days and 90 days from the issuance of payment requests for Independent Third Parties and related parties, respectively.

The following table sets forth the ageing analysis of our trade receivables based on the invoice date:

As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

0 – 30 days ...... 13,791 16,439 17,198 31 – 180 days ...... 4,066 11,074 9,513 181 – 365 days ...... 2,577 2,298 7,784 Over 1 year ...... 22,939 7,034 17,432

Total ...... 43,373 36,845 51,927

As at the Latest Practicable Date, RMB28.3 million, or approximately 54.5%, of our trade receivables as at 31 December 2020, were subsequently settled.

Provision for Impairment of Trade Receivables

Our provision for impairment of trade receivables was RMB5.7 million, RMB1.9 million and RMB2.5 million as at 31 December 2018, 2019 and 2020, respectively. In determining impairment of financial assets, we assess on a forward looking basis the expected credit losses (the “ECL”) associated with our assets carried at amortised cost. For the provision of impairment of trade receivables, we applied the simplified approach permitted by HKFRS 9, which required lifetime ECL to be recognised from initial recognition of the trade receivables. See Notes 2.8 and 18 to the Accountants’ Report in Appendix I to this document for further details.

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Trade Receivables Turnover Days

The following table sets forth our trade receivables turnover days for the years indicated:

For the year ended 31 December 2018 2019 2020

Trade receivables turnover days(Note) . . . 93.5 65.3 67.1

Note: We calculate the trade receivables turnover days using the average of the beginning and ending balance of trade receivables (without taking into account impairment) for the year, divided by revenue for the relevant year, multiplied by the number of days in the relevant year.

During the Track Record Period, our trade receivable turnover days were 93.5 days, 65.3 days, and 67.1 days, respectively. The decrease of trade receivables turnover days in 2019 as compare to 2018 primarily reflected the collection of trade receivables from our related parties in 2019. Our trade receivables turnover days remained relatively stable in 2019 and 2020.

During the Track Record Period, trade receivables turnover days for the related parties were generally longer than for Independent Third Parties, mainly because we typically provide longer credit term to our related parties based on our established relationship and stable payment record and we believe the default risk of our related parties was low. We expect to recover and settle the majority of the outstanding trade receivables from related parties as at 31 December 2020 prior to [REDACTED].

We also plan to further enhance the trade receivables collection processes by implementing the following measures, including but not limited to (i) making phone calls, sending text messages, paying in-person visits, issuing legal collection letters to encouraging property owners and residents to repay property management fees; (ii) reviewing the payment status of our trade receivables on a monthly basis; and (iii) enhancing our collection efforts toward trade receivables from related parties, including proactively communicate with the related parties with respect to the settlement of long outstanding balances, issue and send invoices to the related parties regularly. Except for the balances with the related parties, our trade receivables relate to a number of diversified customers.

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Other Receivables

The table below sets forth a breakdown of our other receivables as at the dates indicated:

As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Deposits and prepayments ...... 1,904 2,043 3,193 Amounts due from related parties ..... 270,882 370,487 412,453 Other receivables ...... 6,448 7,804 8,549 Contract assets ...... – – 962 Deferred [REDACTED] costs ...... – – [REDACTED] Other tax receivables ...... 258 186 54

Less: provision for impairment of other receivables ...... (2,848) (3,387) (3,617)

Total ...... 276,644 377,133 421,954

Deposits and Prepayments

Our deposits and prepayments primarily represent the deposits of utilities and other prepayments in our ordinary course of business. Our deposits and prepayments increased from RMB1.9 million as at 31 December 2018 to RMB2.0 million as at 31 December 2019, which were relatively stable. Our deposits and prepayments increased from RMB2.0 million as at 31 December 2019 to RMB3.2 million as at 31 December 2020, primarily due to the prepayment for acquiring the right of providing property management services for Mountain City Lane.

Amounts Due from Related Parties

As at 31 December 2018, 2019 and 2020, the amounts due from related parties of non-trade nature amounted to RMB270.9 million, RMB370.5 million and RMB412.5 million. The amounts increased significantly from 2018 to 2019, and further increased to RMB412.5 million as at 31 December 2020, primarily reflecting our provision of financial resources to our related parties.

The amount due from related parties of non-trade nature will be fully settled prior to [REDACTED].

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Other Receivables

Our other receivables primarily represent our receivables due from property owners in connection with our payment on their behalf for utilities and maintenance costs of the properties and advances for various expenses. Our other receivables increased from RMB6.4 million as at 31 December 2018 to RMB7.8 million as at 31 December 2019, and further increased to RMB8.5 million as at 31 December 2020, primarily due to the increase in GFA under management.

Contract Assets

A contract asset is recognised when we recognise revenue before being unconditionally entitled to the consideration under the payment terms set out in the contract. See Note 2.12 to the Accountants’ Report in Appendix I to this document for further details. We recorded contract assets of RMB1.0 million as at 31 December 2020, primarily reflecting the capitalisation of certain costs in connection with a project managed by us in Jinan under which the services performed by us did not meet the requirements under accounting policies for revenue recognition.

Deferred [REDACTED] Costs

Our deferred [REDACTED] costs was RMB[REDACTED] as at 31 December 2020, primarily representing our [REDACTED] which have been capitalised.

Provision for Impairment of other Receivables

Our provision for impairment of other receivables was RMB2.8 million, RMB3.4 million and RMB3.6 million as at 31 December 2018, 2019 and 2020, respectively. The increase in our provision for impairment of other receivables was generally in line with the increase in other receivables.

Financial Assets at Fair Value through Profit or Loss

Our financial assets at fair value through profit or loss primarily represent the listed securities held by us. Our financial assets at fair value through profit or loss increased from RMB8.4 million as at 31 December 2018 to RMB12.8 million as at 31 December 2019, primarily due to the increase in fair value of the listed securities held by us. Our financial assets at fair value through profit or loss decreased from RMB12.8 million as at 31 December 2019 to nil as at 31 December 2020 because we disposed all financial assets held by us in 2020.

Income tax recoverable

Our income tax recoverable was RMB0.6 million, RMB2.8 million and RMB0.8 million as at 31 December 2018, 2019 and 2020, respectively, primarily reflecting our overpayment of income tax.

Bank Balances and Cash

We had bank balances and cash of RMB92.8 million, RMB46.0 million and RMB74.7 million as at 31 December 2018, 2019 and 2020, respectively.

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Contract Liabilities

Our contract liabilities mainly arise from the advance payments made by customers while the underlying services are yet to be provided. Our contract liabilities increased from RMB37.2 million as at 31 December 2018 to RMB47.3 million as at 31 December 2019 and further increased to RMB52.5 million as at 31 December 2020 which was in line with the increase in management fees received during the Track Record Period.

Trade and Other Payables

Trade Payables

Our trade payables primarily represent our obligations to pay for goods and services we acquired in the ordinary course of business. The table below sets forth a breakdown of our trade payables as at the dates indicated:

As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Trade payables to third parties ...... 9,555 9,804 9,849 Trade payables to related parties ...... 2,007 164 262

Total ...... 11,562 9,968 10,111

Our trade payables decreased from RMB11.6 million as at 31 December 2018 to RMB10.0 million of 31 December 2019, primarily due to the decrease in our purchases for greening and gardening services from related parties. Our trade payables slightly increased to RMB10.1 million as at 31 December 2020, which was relatively stable.

Aging Analysis on Trade Payables

Our Group was granted by our suppliers credit periods ranging from 30 to 90 days. The ageing analysis of our trade payables based on invoice date is as follows:

As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Within 1 year 11,243 9,543 9,697 Over 1 year 319 425 414

11,562 9,968 10,111

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Trade Payable Turnover Days

The table below sets forth the average turnover days of our trade payables for the periods indicated:

For the year ended 31 December 2018 2019 2020

Trade payables turnover days(Note) ..... 24.6 23.6 22.1

Note: We calculate the trade payables turnover days using the average of the beginning and ending balance of trade payables for the year, divided by costs of sales for the relevant year, multiplied by the number of days in the relevant year.

Our average turnover days of trade payables decreased during the Track Record Period primarily reflecting more timely settlement of trade payables resulted from our more stringent financial management.

As at 31 December 2018, 2019 and 2020, 97.2%, 95.7% and 95.9% of our trade payables were less than one year respectively. As at the Latest Practicable Date, RMB9.4 million, or approximately 92.8%, of our trade payables as at 31 December 2020, were subsequently settled.

Other Payables

Our other payables consist of deposits received, staff costs and welfare accruals, accrued charges and other payables, amounts due to related parties, amounts collected on behalf of property owners, other receipts in advance, other tax liabilities and provision for litigation. The table below sets forth a breakdown of our other payables as at the dates indicated:

As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Deposits received ...... 21,174 18,300 18,977 Staff costs and welfare accruals ...... 21,424 25,083 27,687 Accrued charges and other payables . . . 3,771 4,816 5,923 Amounts due to related parties ...... 32,775 23,649 24,149 Amounts collected on behalf of property owners ...... 16,082 20,263 21,187 Receipts in advance – other ...... 1,775 2,087 1,477 Other tax liabilities ...... 1,838 1,269 3,178 Provision for litigation ...... – – 934

Total ...... 98,839 95,467 103,512

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Deposits received

Our deposits received primarily represent the deposits received for certain renovation works, entrance permit deposits and deposits from commercial property tenants. Our deposits received increased from RMB18.3 million as at 31 December 2019 to RMB19.0 million as at 31 December 2020, primarily reflecting the increase in renovation works as a result of the increase in GFA delivered in 2020. Our deposits received decreased from RMB21.2 million as at 31 December 2018 to RMB18.3 million as at 31 December 2019, primarily reflecting the lower balance of deposits received for renovation works as a result of the lower GFA delivered in 2019.

Staff costs and welfare accruals

Our staff costs and welfare accruals increased from RMB25.1 million as at 31 December 2019 to RMB27.7 million as at 31 December 2020, primarily due to the increased bonus payables at the end of the year. Our staff costs and welfare accruals increased from RMB21.4 million as at 31 December 2018 to RMB25.1 million as at 31 December 2019, which is in line with our business expansion.

Accrued charges and other payables

Our accrued charges and other payables increased from RMB3.8 million as 31 December 2018 to RMB4.8 million as at 31 December 2019, and further increased to RMB5.9 million as at 31 December 2020, primarily reflecting the increase in our daily expenses which is in line with our business expansion over the same period.

Amounts due to related parties

As of 31 December 2018, 2019 and 2020, we had amounts due to the related parties which was non-trade in nature amounting to RMB32.8 million, RMB23.6 million and RMB24.1 million, respectively. The decrease in amounts due to related parties in 2019 was primarily due to our repayment to related parties. These amounts were non-interest bearing, unsecured and unguaranteed.

The amounts due to related parties of non-trade nature will be fully settled prior to [REDACTED].

Amounts collected on behalf of property owners

Our amounts collected on behalf of property owners increased from RMB16.1 million as at 31 December 2018 to RMB20.3 million as at 31 December 2019, and further increased to RMB21.2 million as at 31 December 2020, primarily reflects the increase in utilities we collect on behalf of property owners as a result of the increase in GFA under management.

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Other tax liabilities

Our other tax liabilities increased from RMB1.3 million as at 31 December 2019 to RMB3.2 million as at 31 December 2020, primarily because of the increase in year-end issue of invoice to our related parties as compared with the previous year which led to an increase in the VAT payable. Our other tax liabilities decreased from RMB1.8 million as at 31 December 2018 to RMB1.3 million as at 31 December 2019, primarily because (i) our certain subsidiaries settled certain taxes from the previous year; and (ii) the deductible invoice we obtained by the end of 2019.

Others

Our provision of litigation was nil, nil and RMB0.9 million as at 31 December 2018, 2019 and 2020, respectively. We also had other receipts in advance in the amounts of RMB1.8 million, RMB2.1 million and RMB1.5 million as at 31 December 2018, 2019 and 2020, respectively.

Lease liabilities

Our lease liabilities were RMB0.3 million, RMB23,000 and RMB0.2 million as at 31 December 2018, 2019 and 2020, respectively, primarily reflecting the aggregate discounted amount payable for the remaining term of our leases.

Income Tax Liabilities

We recorded income tax liabilities of RMB1.8 million, RMB1.7 million and RMB8.9 million, as at 31 December 2018, 2019 and 2020, respectively. The increases in tax payables as at 31 December 2020 were mainly due to a certain subsidiary subject to a higher income tax rate of 25% compared to our overall effective tax rate recording a gain from the sale of financial assets at fair value through profit and loss in 2020. Please refer to the paragraph headed “—Key Components of our Combined Statements of Profit or Loss and Other Comprehensive Income—Income Tax Expense” above for further details.

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Net Current Assets

The following table sets forth our current assets and current liabilities as at the balance sheet dates indicated:

As at As at 31 December 30 April 2018 2019 2020 2021 RMB’000 RMB’000 RMB’000 RMB’000 (unaudited)

Current Assets Inventories ...... 864 713 572 530 Trade and other receivables .... 314,345 412,063 471,372 194,555 Financial assets at fair value through profit or loss ...... 8,429 12,847 – – Income tax recoverable ...... 620 2,794 842 – Bank balances and cash ...... 92,827 45,997 74,733 47,824

Total Current Assets ...... 417,085 474,414 547,519 242,909

Current Liabilities Contract liabilities ...... 37,172 47,273 52,511 46,740 Trade and other payables ...... 110,401 105,435 113,623 101,823 Income tax liabilities ...... 1,754 1,698 8,889 566 Lease liabilities ...... 332 23 246 246

Total Current Liabilities ...... 149,659 154,429 175,269 149,375

Net Current Assets ...... 267,426 319,985 372,250 93,534

Our net current assets decreased from RMB372.3 million as at 31 December 2020 to RMB93.5 million as at 30 April 2021, primarily due to an RMB276.8 million decrease in trade and other receivables primarily due to reduction of registered capital and distribution of dividend of certain of our subsidiaries which are used to offset certain receivables from related parties, partially offset by (i) an RMB5.8 million decrease in contract liabilities primarily due to advance receipts being converted and recognised as revenue; (ii) and RMB8.3 million decrease in income tax liabilities primarily due to payment of EIT for 2020 and (iii) an RMB11.8 million decrease in trade and other payables primarily due to the payment of year-end bonus of 2020. Our net current asset increased from RMB320.0 million as at 31 December 2019 to RMB372.3 million as at 31 December 2020, primarily due to (i) an RMB14.5 million increase in our trade receivable in line with our business growth; (ii) an RMB42.0 million increase in amounts due from related parties, primarily representing our provision of financial resources to related parties; and (iii) an RMB28.7 million increase in bank balances and cash primarily due to cash inflow generated from profits of business operations, partially offset by (i) an RMB12.8 million decrease in financial assets at fair value through profit or loss primarily due to the disposal of listed securities; (ii) an RMB7.2 million increase in income tax liabilities, primarily due to a certain

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INDEBTEDNESS

During the Track Record Period and as at 30 April 2020, we did not apply or obtain any banking facilities and we did not have any unutilised banking facilities.

During the three years ended 31 December 2018, 2019 and 2020, certain of our subsidiaries provided guarantees and/or pledge of future right of revenue of those subsidiaries to a bank in respect of banking facilities granted to companies controlled by Mr. Wong and Ms. Chan. The total amount covered by the financial guarantee and/or pledges provided by these subsidiaries during the years ended 31 December 2018, 2019 and 2020 were approximately RMB280.0 million, RMB620.0 million and RMB620.0 million, respectively. Revenue generated by those subsidiaries during the years ended 31 December 2018, 2019 and 2020 were approximately RMB20.7 million, RMB22.7 million and RMB25.2 million, respectively.

Please refer to Note 27 of the Accountants’ Report as set out in Appendix I to this document for details.

All these guarantees and pledges will be released prior to [REDACTED].

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CONTINGENT LIABILITIES

As at 31 December 2018, 2019 and 2020, save as disclosed in this document, we did not have any material contingent liabilities, mortgages, charges, debt securities, or any litigations or claims of material importance, pending or threatened against any member of our Group. Our Directors have confirmed that there was no material adverse change in our Group’s contingent liabilities since 31 December 2020 and up to the Latest Practicable Date.

LIQUIDITY AND CAPITAL RESOURCES

Our primary use of cash is to fund our working capital requirements. We have historically funded our operations through cash generated from our operations and advances from the related parties. As at 31 December 2018, 2019 and 2020, we had bank balances and cash of RMB92.8 million, RMB46.0 million and RMB74.7 million, respectively. Following the completion of the [REDACTED], we expect to fund our future working capital, capital expenditure and other cash requirements through cash generated from our operations, repayment from amounts due from related parties, bank borrowings, and the [REDACTED]fromthe[REDACTED].

Working Capital Sufficiency

After taking into consideration the financial resources available to our Group, including our bank balances and cash on hand, operating cash flows and the estimated [REDACTED] from the [REDACTED], and in the absence of unforeseeable circumstances, our Directors confirm that we have sufficient working capital for our present requirements, that is for at least the next 12 months from the date of this document.

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The following table sets forth out cash flows during the Track Record Period.

For the Year ended 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Cash flows from operating activities Profit before tax ...... 22,883 42,659 65,193 Adjustments ...... 6,229 (6,573) (12,160) Working capital changes ...... 28,436 19,477 (5,882) Cash generated from operating activities .... 57,548 55,563 47,151 Income tax paid ...... (4,241) (7,537) (2,687)

Net cash generated from operating activities ...... 53,307 48,026 44,464

Cash flows from investing activities ...... Investment in a joint venture ...... (1,000) – – Purchase of property, plant and equipment . . (731) (893) (1,565) Purchase of intangible assets ...... (547) (503) (510) Proceeds from disposal of property, plant and equipment ...... – – 3 Proceeds from disposal of financial assets at fair value through profit or loss ...... – – 27,734 Advance to amounts due from related parties (17,091) (99,565) (41,945) Purchase of financial assets at fair value through profit or loss ...... (9,992) (7) – Dividend received ...... 279 299 416 Interest received ...... 221 302 133

Net cash used in investing activities ...... (28,861) (100,367) (15,734)

Cash flows from financing activities Advance from/(Repayment to) amounts due to related parties ...... 14,443 (9,126) 500 Issuance of Share capital ...... – 15,000 – Repayment of lease liabilities ...... (617) (355) (149) Interest paid on lease liabilities ...... (45) (8) (25) [REDACTED]-related expenses paid ...... – – (320)

Net cash generated from financing activities ...... 13,781 5,511 6

Net increase/(decrease) in cash and cash equivalents ...... 38,227 (46,830) 28,736

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Cash Flows from Operating Activities

We generate cash from our operating activities primarily from fees received for providing our property management services and commercial operational services, while cash used in our operating activities were primarily attributable to the payment of staff costs and payments for other working capital needs. Cash flows from operating activities can be significantly affected by factors such as the timing of collection of trade receivables from customers and the timing of payment of trade payables to suppliers during the ordinary course of our business, which also primarily accounted for the difference in the net cash generated from operating activities during the Track Record Period. Cash flows from operating activities reflects (i) profit before tax adjusted for non-cash and non-operating items, such as interest income, depreciation of property, plant and equipment, long-term equity investment; (ii) movements in working capital, such as increase or decrease in trade receivables and prepayments, other receivables and other assets, increase or decrease in trade payables, other payables and contract liabilities; and (iii) other cash items consisting of interested received and income tax paid.

Net cash generated from operating activities amounted to RMB44.5 million in 2020, primarily reflecting (i) profit before income tax of RMB65.2 million; (ii) negative adjustments of RMB12.2 million, which primarily reflecting the adjustment for RMB14.9 million gain on sales of financial assets at fair value through profit or loss in relation to our disposal of listed securities; and (iii) negative movements in working capital of RMB5.9 million, which primarily reflected an RMB18.2 million increase in trade receivables and other receivables mainly due to the increase in our transaction amount with related parties, partially offset by an RMB6.9 million increase in trade payables and other payables mainly due to the increase in staff costs and welfare accruals and other tax liabilities and an RMB5.2 million increase in contract liabilities.

Net cash generated from operating activities amounted to RMB48.0 million in 2019, primarily reflecting (i) profit before income tax of RMB42.7 million; (ii) negative adjustments of RMB6.6 million, which primarily reflecting the adjustments for RMB4.4 million gain on fair value changes of financial assets at fair value through profit or loss in relations to our holding of listed securities and RMB3.2 million reversal of impairment loss on trade and other receivables; and (iii) positive movements in working capital of RMB19.5 million, which primarily reflected an RMB10.1 million increase in contract liabilities mainly due to the increase in the prepayment of property management fee and commercial operational service fee and an RMB4.2 million increase in trade payables and other payables mainly due to the increase in utilities collection in advance for the residents which is in line with the growth of GFA under management, a decrease of RMB5.1 million in trade and other receivables primarily due to repayment of trade receivables by related parties.

Net cash generated from operating activities amounted to RMB53.3 million in 2018, primarily reflecting (i) profit before income tax of RMB22.9 million; (ii) positive adjustment of RMB6.2 million, which primarily reflecting the adjustment for RMB3.3 million provision for impairment loss on trade and other receivables; and (iii) positive movements in working capital of RMB28.4 million, which primarily reflected a RMB13.8 million decrease in trade and other receivables, a RMB9.4 million increase in trade payables and other payables, and an RMB5.8 million increase in contract liabilities.

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Cash Flows used in Investing Activities

Our investing activities primarily consist of purchases of items of property, plant and equipment and investment in a joint venture.

Net cash used in investing activities amounted to RMB15.7 million in 2020, primarily reflecting advance to amounts due from related parties of RMB41.9 million, partially offset by proceeds from disposal of financial assets at fair value through profit or loss of RMB27.7 million.

Net cash used in investing activities amounted to RMB100.4 million in 2019, primarily reflecting advance to amounts due from related parties of RMB99.6 million.

Net cash used in investing activities amounted to RMB28.9 million in 2018, primarily reflecting (i) advance to amounts due from related parties of RMB17.1 million; and (ii) purchase of financial assets at fair value through profit or loss of RMB10.0 million.

Cash Flows from Financing Activities

Net cash generated from financing activities amounted to RMB6,000 in 2020, primarily reflecting advance from related party of RMB0.5 million, partially offset by [REDACTED]-related expense paid of RMB[REDACTED].

Net cash generated from financing activities amounted to RMB5.5 million 2019, primarily reflecting the capital contribution of the shareholder of Chongqing Ronghui of RMB15.0 million, partially offset by repayment to amounts due to related parties of RMB9.1 million.

Net cash generated from financing activities amounted to RMB13.8 million in 2018, primarily reflecting advance from amounts due to related parties of RMB14.4 million, partially offset by repayment of lease liabilities of RMB0.6 million.

CAPITAL EXPENDITURE AND COMMITMENTS

Capital Expenditure

Our capital expenditure in 2018, 2019 and 2020, was RMB0.7 million, RMB0.9 million and RMB1.6 million, respectively. Our capital expenditure was used primarily for purchases of furniture, fixtures and office equipment. We financed our capital expenditure primarily through our cash flow generated from operating activities. We expect to finance these capital expenditures with cash generated from our operations and [REDACTED]fromthe [REDACTED]. Save as disclosed in the section headed “Future Plans and [REDACTED]” in this document, we have no other material planned capital expenditure in 2021 and 2022.

Capital Commitments

Our capital commitments in 2018, 2019 and 2020 was RMB31,000, nil and RMB761,000, respectively. Our capital commitments primarily reflects our commitments for (i) acquisition of property, plant and equipment and (ii) acquisition of intangible assets.

RELATED PARTY TRANSACTIONS

We entered into transactions with certain related party transactions from time to time.

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Significant Related Party Transactions

During the Track Record Period, we had certain significant transactions with related parties.

In 2018, 2019 and 2020, revenue recorded for providing services to related parties amounted to RMB37.4 million, RMB42.8 million and RMB60.9 million, respectively. We mainly provided (i) market research and positioning, tenant sourcing and opening preparation and commercial operation and management services under our commercial operational services business line; and (ii) general property management services and value-added services to non-property owners under our property management services business line during the Track Record Period.

During the Track Record Period, our related parties also supplied us with (i) gardening and cleaning services; (ii) materials for marketing and employees benefit; (iii) administrative staff; (iv) miscellaneous office expenses; (v) utilities; and (vi) venue leasing services during the Track Record Period.

The table below sets forth the amount of our revenue and costs of sales involved with respect transactions entered into with Ronghui Group and its related parties. For the Year ended 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Companies controlled by Mr. Wong and Ms. Chan Income from general property management services ...... 10,272 10,623 10,338 Income from value-added services to non-property owners ...... 15,200 19,121 21,297 Income from community value-added services...... 3,719 5,090 14,098 Income from commercial operational services to property developers and property owners ...... – – 6,236 Purchase of gardening and cleaning services...... (2,910) (965) (798) Purchase of materials for marketing and employees benefit...... (356) (374) (513) Administration staff cost re-charge ..... (1,118) (1,255) (1,383) Miscellaneous office expense...... (44) (133) (133) Utility expense ...... (499) – – Lease expenses ...... (661) (322) (93)

Joint ventures controlled by Mr. Wong and Ms. Chan Income from general property management services ...... 1,557 1,461 2,241 Income from value-added services to non-property owners ...... 6,671 6,537 6,721 Income from community value-added services...... 6 – – Purchase of materials for marketing and employees benefit...... (7) – (7)

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The table below sets forth a breakdown of our balances with related parties as at the dates indicated. As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000 Amounts due from related parties Trade receivable – companies controlled by Mr. Wong and Ms. Chan(3) ...... 15,108 5,633 14,711 – joint ventures controlled by Mr. Wong and Ms. Chan(3) ...... 16,955 19,497 23,804

32,063 25,130 38,515 Other receivables ...... – companies controlled by Mr. Wong and Ms. Chan(1)(2) ...... 270,882 370,487 412,453

302,945 395,617 450,968

Amounts due to related parties Trade payable – companies controlled by Mr. Wong and Ms. Chan (Note 1) ...... 2,007 164 262

Other payables – companies controlled by Mr. Wong and Ms. Chan (Note 1) ...... 32,701 23,596 23,986 – joint ventures controlled by Mr. Wong Cho Shi and Ms. Chan Sun Ping (Note 1) ...... 74 53 163

32,775 23,649 24,149

Lease liabilities

– companies controlled by Mr. Wong and Ms. Chan (Note 1) ...... 332 – 1,150

35,114 23,813 25,561

Notes:

(1) The amounts due are unsecured, interest-free, repayable on demand and denominated in RMB.

(2) The maximum amount outstanding during the years ended 31 December 2018, 2019 and 2020 are RMB270.9 million, RMB370.5 million and RMB412.5 million, respectively.

(3) For terms of trade receivable, please refer to “Trade and Other Receivables” in Financial Information.

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During the Track Record Period, certain of our subsidiaries provided guarantees and/or pledge of future right of revenue of those subsidiaries to a bank in respect of banking facilities granted to companies controlled by Mr. Wong and Ms. Chan. Please refer to the section headed “— Indebtedness” above for further details.

Our Directors confirm that the abovementioned transactions with related parties were conducted on an arm’s length basis. Our Directors confirm that all other related party balances which are non-trade in nature will be fully settled before [REDACTED]. For details on these transactions, see Note 27 to the Accountants’ Report included in Appendix I to this document.

OFF-BALANCE SHEET COMMITMENTS AND ARRANGEMENTS

Except for the contingent liabilities disclosed above, we had no material off-balance sheet arrangements as at 31 December 2020, being the date of our most recent financial statement, and as at the Latest Practicable Date.

KEY FINANCIAL RATIOS

The table below sets forth the key financial ratios as at the dates or for the periods indicated:

As at/For the year ended 31 December 2018 2019 2020

Current ratio(1) ...... 2.8 3.1 3.1 Return on assets(2) ...... 4.6% 7.9% 10.5% Return on equity(3) ...... 7.0% 11.9% 15.4% Gross profit margin(4)...... 23.3% 25.8% 31.4% Net profit margin(5) ...... 9.3% 15.9% 22.4%

Notes:

(1) Current ratio is total current assets as at year-end as a percentage of total current liabilities as at year-end.

(2) Return on assets is calculated based on our profit for the relevant year divided by our average total assets as at the beginning and the end of the corresponding year and multiplied by 100%.

(3) Return on equity is calculated based on our profit for the relevant year divided by our average total equity as at the beginning and the end of the corresponding year and multiplied by 100%.

(4) Gross profit margin is calculated based on our gross profit for the relevant year divided by our revenue for the relevant year and multiplied by 100%.

(5) Net profit margin is calculated based on our profit for the relevant year divided by our revenue for the relevant year and multiplied by 100%.

Current Ratio

Our current ratio increased from approximately 2.8 as at 31 December 2018 to 3.1 as at 31 December 2019, primarily attributable to the increase in other receivables. Our current ratio remained relatively stable at 3.1 as at 31 December 2019 and 31 December 2020.

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Return on Assets

Our return on assets increased from 4.6% in 2018 to 7.9% in 2019, and further increased to 10.5% in 2020, primarily due to the increase in net profit during the Track Record Period.

Return on Equity

Our return on equity increased from 7.0% in 2018 to 11.9% in 2019, and further increased to 15.4% in 2020, primarily due to the increase in net profit during the Track Record Period.

Gross profit margin

Our gross profit margin increased from 23.3% in 2018 to 25.8% in 2019, and further increased to 31.4% in 2020, primarily due to the reasons set out in the paragraph headed “Review of Historical Results of Operations” in this section.

Net profit margin

Our net profit margin increased from 9.3% in 2018 to 15.9% in 2019, and further increased to 22.4% in 2020, primarily due to the reasons set out in the paragraph headed “Review of Historical Results of Operations” in this section.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT FINANCIAL RISKS

The main risks associated with our financial instruments are (i) credit risk; (ii) liquidity risk; (iii) market risk (including interest rate risk and foreign currency risk); and (iv) price risk. Our management regularly reviews and monitors our exposures to these risks in order to ensure appropriate measures are implemented in a timely and effective manner. As at the Latest Practicable Date, we did not hedge or consider necessary to hedge any of these risks. Details of the relevant risks and our policies for managing these risks are set out below. Please refer to Note 29 to the Accountants’ Report in Appendix I to this document for more information.

Credit Risk

We are exposed to credit risk in relation to our bank deposits and trade and other receivables. Our maximum exposure to credit risk in relation to financial assets is limited to the carrying amount at the reporting dates.

To manage this risk, bank deposits are mainly placed with state-owned financial institutions and reputable banks which are all high-credit-quality financial institutions. Our management does not expect that there will be any significant losses from non- performance by these counterparties.

Please refer to Note 18 to the Accountants’ Report in Appendix I to this document for more information about the provision for expected credit loss for trade and other receivables.

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We have large number of counterparties for our other receivables other than those from related parties. There was no concentration of credit risk. We have monitoring procedures to ensure that follow-up action is taken to recover overdue debts. In addition, we review the recoverability of these receivables at the reporting date to ensure that adequate impairment losses are made for irrecoverable amounts. We consider 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. Please refer to Note 2.8 to the Accountants’ Report in Appendix I to this document for more details about how we determine whether there has been a significant increase in credit risk.

Liquidity Risk

Liquidity risk relates to the risk that we will not be able to meet its obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. We are exposed to liquidity risk in respect of settlement of trade and other payables and also in respect of its cash flow management. Our objective is to maintain an appropriate level of liquid assets and committed lines of funding to meet its liquidity requirements in the short and longer term.

Analysed below is our Group’s remaining contractual maturities for our non-derivative financial liabilities as at 31 December 2018, 2019 and 2020. When the creditor has a choice of when the liability is settled, the liability is included on the basis of the earliest date when our Group can be required to pay. Where the settlement of the liability is in instalments, each instalment is allocated to the earliest period in which our Group is committed to pay. Total Within 1 Over 1 year Over 2 years undiscounted year or on but within but within contractual Carrying demand 2 years 5 years amount amount RMB’000 RMB’000 RMB’000 RMB’000 RMB’000

As at 31 December 2018 Trade and other payables 106,788 – – 106,788 106,788 Lease liabilities 339 – – 339 332

107,127 – – 107,127 107,120

As at 31 December 2019 Trade and other payables 102,079 – – 102,079 102,079 Lease liabilities 24 – – 24 23

102,103 – – 102,103 102,102

As at 31 December 2020 Trade and other payables 108,034 – – 108,034 108,034 Lease liabilities 300 353 641 1,294 1,164

108,334 353 641 109,328 109,198

For financial guarantee provided to reflected related companies, please refer to Note 27(d) of the Accountants’ Report as set out in Appendix I to this document.

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Interest Rate Risk

Other than the interest-bearing bank deposits, we have no other significant interest-bearing assets and liabilities. The Directors do not anticipate there is any significant impact to the interest-bearing assets resulted from the changes in interest rates, because the interest rates of bank balance are not expected to change significantly.

Foreign currency risk

We operate mainly in PRC and majority of the transactions are denominated and settled in the functional currency of respective entities within our Group, RMB.

Foreign currency risk arises when future commercial transactions and recognised assets and liabilities are denominated in a currency that is not the entity’s functional currency. As at 31 December 2018, 2019 and 2020, we did not have significant foreign currency risk from our operations.

We do not hedge our foreign currency risk. However, our management monitors the foreign currency exposure and will consider hedging significant foreign currency exposure should the need arise.

Price Risk

We have been exposed to the price risk of financial assets measured at FVTPL. We manage the equity price risk by placing limits on individual and total equity instruments. Reports on the equity portfolio are submitted to our senior management on a regular basis. The Directors review and approve all equity investment decisions.

If the price of financial assets measured at FVTPL had been 5% increased/decreased, post-tax profit for the year ended 31 December 2018, 2019 and 2020 would have been increased/decreased by approximately RMB316,000, RMB482,000 and nil, respectively.

DIVIDEND POLICY AND DISTRIBUTABLE RESERVE

In March 2021, certain of our subsidiaries declared dividends of an aggregate amount of RMB89.0 million to their then shareholders to offset related parties receivables. Save as above, we did not declare any dividends during the Track Record Period.

As we are a holding company, our ability to declare and pay dividends will depend on receipt of sufficient funds from our subsidiaries. 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. Any future declaration and payment of dividend is subject to the absolute discretion of our Board of Directors, and, after the [REDACTED], any declaration of final dividend for the year will be subject to the approval of our Shareholders. As our Company was incorporated on 1 February 2021, our Company did not have any available distributable reserve as at 31 December 2020.

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NO ADDITIONAL DISCLOSURE REQUIRED UNDER LISTING RULES

Our Directors have confirmed that, as at the Latest Practicable Date, they were not aware of any circumstances which would have given rise to a disclosure requirement under Rules 13.13 to 13.19 of the Listing Rules.

[REDACTED]

The total amount of [REDACTED] that will be borne by us in connection with the [REDACTED], including [REDACTED], is estimated to be [REDACTED] million (based on the [REDACTED] of the indicative [REDACTED]) of which (i) [REDACTED] million was charged to our combined statement of profit or loss and other comprehensive income in the year ended 31 December 2020; (ii) approximately [REDACTED] million is expected to be charged to our combined statement of profit or loss and other comprehensive income for the year ending 31 December 2021; and (iii) the remaining amount of [REDACTED] million being capitalised as at 31 December 2021, are expected to be accounted for as a deduction from equity upon [REDACTED].

Our Directors would like to emphasise that the estimated amount of [REDACTED] disclosed above is for reference only. The final amount of [REDACTED] in relation to the [REDACTED] to be recognised in our combined statements of profit or loss and other comprehensive income for the year ending 31 December 2021 will be subject to adjustment based on audit and the then changes in variables and assumptions. Prospective investors should note that our financial performance for the year ending 31 December 2021 is expected to be adversely affected by non-recurring [REDACTED], and may or may not be comparable to our financial performance in the past.

UNAUDITED PRO FORMA ADJUSTED COMBINED NET TANGIBLE ASSETS

The following statement of unaudited pro forma adjusted combined net tangible assets has been prepared in accordance with rule 4.29 of the Listing Rules and with reference to Accounting Guideline 7 Preparation of Pro Forma Financial Information for Inclusion in Investment Circulars issued by the Hong Kong Institute of Certified Public Accountants for illustration purpose only, and is set out below to illustrate the effect of the [REDACTED]onthe combined net tangible assets attributable to the owners of the parent as at 31 December 2020 as if the [REDACTED] had taken place on 31 December 2020.

The statement of unaudited pro forma adjusted combined 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 combined net tangible assets of the Group attributable to the owners of the parent had the [REDACTED] been completed as at 31 December 2020 or any future date. It is prepared based on the combined net tangible assets attributable to the owners of the parent as at 31 December 2020 as set out in the Accountants’ Report, the text of which is set out in Appendix I to this document, and adjusted as described below.

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Audited combined net Unaudited tangible pro forma assets of the adjusted Group combined net attributable to tangible owners of the assets of the Unaudited pro forma adjusted Company Estimated Group combined net tangible assets as at [REDACTED] attributable to of the Group attributable to 31 December from the owners of the owners of the Company 2020 [REDACTED] Company per Share RMB’000 RMB’000 RMB’000 RMB HK$ (1) (2) (3) (4)

Based on the [REDACTED]of HK$[REDACTED] (RMB[REDACTED]) per share ...... 377,360 [REDACTED][REDACTED][REDACTED][REDACTED]

Notes:

(1) The audited combined net tangible assets of the Group attributable to owners of the Company as at 31 December 2020 is extracted from the Accountants’ Report set out in Appendix I to this document, which is based on the audited combined net tangible assets of the Group attributable to the owners of the Company as at 31 December 2020 of approximately RMB378,365,000, with adjustment for intangible assets as at 31 December 2020 of RMB1,005,000.

(2) The estimated net [REDACTED] from the [REDACTED] are based on [REDACTED] of an indicative [REDACTED]of[REDACTED] (equivalent to [REDACTED]) and [REDACTED] (equivalent to [REDACTED]) per [REDACTED] Share, respectively (after deducting the [REDACTED] and other related expenses), and takes no account of any Shares which may be allotted and issued upon the exercise of the [REDACTED].

(3) The unaudited pro forma adjusted combined net tangible assets of the Group attributable to owners of the Company as at 31 December 2020 per Share is calculated based on [REDACTED] Shares, being the number of Shares expected to be in issue immediately following the Capitalisation Issue and the [REDACTED] had it been completed on 31 December 2020. It does not take into account of any Shares that may be granted and issued by the Company pursuant to the exercise of the [REDACTED].

(4) No adjustment has been made to the unaudited pro forma adjusted combined net tangible assets of the Group attributable to owners of the Company as at 31 December 2020 to reflect any trading results or other transactions of the Group entered into subsequent to 31 December 2020. In particular, the unaudited pro forma adjusted net tangible assets of the Group attributable to equity holders of the Company has not taken into account the declaration of dividends of aggregated amount of RMB89 million by which was approved by the boards of the subsidiaries of the Group on 28 March 2020 and the reduction of registered capital of the subsidiaries with aggregated amount of RMB205 million. The unaudited pro forma adjusted net tangible assets per share would have been [REDACTED] (equivalent to approximately [REDACTED]) and [REDACTED] (equivalent to approximately [REDACTED]) per Share based on the [REDACTED]of[REDACTED] and [REDACTED] per Share respectively, if the effect of such dividend and reduction of registered capital had been accounted for.

(5) For the purpose of the estimated [REDACTED]fromthe[REDACTED], the amount stated in Hong Kong dollars has been converted into Renminbi at the rate of RMB0.8289 to HK$1.00. No representation is made that the amounts in Hong Kong dollars have been, could have been or may be converted to the amounts in Renminbi, or vice versa, at that rate or at all.

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NO MATERIAL ADVERSE CHANGE

Save for the estimated non-recurring [REDACTED] as disclosed in the paragraph headed “—[REDACTED]” above and disclosures below, our Directors, after due and careful consideration, confirm that since 31 December 2020 and up to the date of this document, (i) there has been no material adverse change in our business, financial or trading position or prospects of our Group; and (ii) no event had occurred that would affect the information shown in our Accountants’ Report in Appendix I to this document in any material respect.

Capital Reduction

For the purpose of the Reorganisation, the registered capital of the following operating subsidiaries was reduced:

On 10 February 2021, the registered capital of Ronghui Guanling was reduced from RMB160.0 million to RMB20.0 million by way of repurchase by Ronghui Guanling of approximately RMB122.5 million of the equity interest held by Chongqing Ronghui Properties, RMB0.2 million of the equity interest held by Ronghui Hot Spring and RMB17.3 million of the equity interest held by Chongqing Ronghui Investment. The shareholding of Ronghui Guanling remained unchanged following such reduction of registered capital.

Dividend Declaration

In March 2021, certain of our subsidiaries declared dividend of an aggregate amount of RMB89.0 million to their then shareholders to offset related parties receivables. For further details, please refer to Note 31 in Appendix I to this document.

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FUTURE PLANS

Please refer to the section headed “Business – Our Strategies” in this document for a detailed description of our future plans.

USE OF [REDACTED]

We estimate the [REDACTED]ofthe[REDACTED] which we will receive, assuming an [REDACTED]of[REDACTED] per [REDACTED] Share (being the [REDACTED]ofthe [REDACTED] stated in this document), will be approximately [REDACTED], after deduction of [REDACTED] fees and [REDACTED] and estimated expenses paid and payable by us in connection with the [REDACTED] and assuming the [REDACTED] is not exercised.

We intend to use the [REDACTED]ofthe[REDACTED] for the following purposes assuming the [REDACTED] is fixed at HK$[REDACTED] per [REDACTED] Share (being the [REDACTED] of the indicative [REDACTED]):

• approximately [REDACTED], or [REDACTED], will be used to expand our property management services business and commercial operational services business, of which,

(i) approximately [REDACTED], or [REDACTED], will be used to acquire or invest in property management companies with business focus in Chengdu-Chongqing Economic Zone, Bohai Rim Economic Zone or Western Taiwan Strait Economic Zone that (a) have an aggregated GFA under management of over 800,000 sq.m. or annual net profit margin of over 8.0% in the latest financial year; or (b) have diversified property portfolio, including but not limited to, residential properties, commercial properties, cultural and tourism properties, industrial parks, schools, hospitals and public properties;

(ii) approximately [REDACTED], or [REDACTED], will be used to acquire or invest in commercial operational services providers with business focus in Chongqing, Jinan or Fuzhou that (a) have an aggregated GFA under management of 50,000 sq.m. or above or annual net profit margin of 15.0% or above in the latest financial year; or (b) manage diversified commercial property portfolio such as shopping malls or shopping streets, or commercial projects which have higher growth potential; and

(iii) approximately [REDACTED], or [REDACTED], will be used to acquire or invest in companies that can create synergies with our community value-added services and smart management system and, in particular, companies that (a) have business focus on community value-added services and smart management platform, such as smart community, health and elderly care, catering and housekeeping; or (b) have stable customer base and cash flow; or (c) have well-developed management systems;

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as at the Latest Practicable Date, we had not identified any potential investment acquisition target or entered into any definite investment or acquisition agreement. In addition to the aforementioned criteria, in evaluating potential investment or acquisition targets, we are also inclined to invest in those that possess a competent management team, proven track record, with good reputation in the industry and sound compliance record;

• approximately [REDACTED]or[REDACTED] will be used to upgrade our information system and smart platform, of which:

(i) approximately [REDACTED]or[REDACTED], will be used to upgrade our property management information system, such as intelligent property management platform, Xiaohui Dangjia smart community service platform and intelligent community facilities management platform and IoT hardware, so as to improve our operational efficiency and improve the quality of our services;

(ii) approximately [REDACTED]or[REDACTED], will be used to upgrade our commercial operational information system, such as commercial operational management platform, and establish a commercial customer statistics system and a grand membership system. Through the grand membership system, the property management information system and the commercial operational management platform can share membership benefits across these systems, thereby creating additional commercial value through multi-business cooperation; and

(iii) approximately [REDACTED]or[REDACTED], will be used to upgrade our internal management system and core data management platform, such as video conferencing system, file management system, office automation system, human resource system, financial management system and other management systems by purchasing third-party hardware and software so as to reduce human error, provide management with the latest operating performance through data analysis and improve business management efficiency,

• approximately [REDACTED], or [REDACTED], will be used to develop other diversified value-added services to improve our value-added services penetration rate and upgrade our existing value-added services, of which:

(i) approximately [REDACTED], or [REDACTED], will be used to further develop other community value-added services based on our residents’ needs and the favourable policies for community services, primarily through health and elderly care, community catering as well as marketing and private activities;

(ii) approximately [REDACTED], or [REDACTED], will be used to upgrade our existing value-added services, primarily through group buying, community tailor-made services and sales assistance; and

• approximately [REDACTED], or [REDACTED], will be used for working capital and general corporate purpose.

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The above allocation of the [REDACTED] 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 [REDACTED]ofthe estimated [REDACTED] or that the [REDACTED] is exercised.

If the [REDACTED] is fixed at HK$[REDACTED] per [REDACTED] Share (being the high end of the [REDACTED] stated in this document) and assuming the [REDACTED]isnot exercised, we will receive [REDACTED] of approximately HK$[REDACTED], after deduction of [REDACTED] fees and [REDACTED] and estimated expenses paid and payable by us in connection with the [REDACTED].

If the [REDACTED] is fixed at HK$[REDACTED] per [REDACTED] Share (being the low end of the [REDACTED] stated in this document) and assuming the [REDACTED]isnot exercised, the [REDACTED] we receive will be approximately HK$[REDACTED], after deduction of [REDACTED] fees and [REDACTED] and estimated expenses paid and payable by us in connection with the [REDACTED].

In the event that the [REDACTED] is exercised in full, we will receive additional [REDACTED] ranging from approximately HK$[REDACTED] (assuming an [REDACTED]of HK$[REDACTED] per [REDACTED] Share, being the low end of the proposed [REDACTED]) to HK$[REDACTED] million (assuming an [REDACTED] of HK$[REDACTED] per [REDACTED] Share, being the high end of the proposed [REDACTED]), after deduction of [REDACTED] fees and [REDACTED] and estimated expenses paid and payable by us in connection with the [REDACTED].

To the extent that the [REDACTED] are not immediately applied to the above purposes and to the extent permitted by applicable law and regulations, we intend to apply the [REDACTED] to short-term demand deposits and/or money market instruments. We will make an appropriate announcement if there is any change to the above proposed [REDACTED]orif any amount of the [REDACTED] will be used for general corporate purpose.

Implementation Plans

Based on our business strategies and future plans, we intend to carry out the following implementation plans as set forth below for the period from the Latest Practicable Date to 31 December 2023.

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1. Business expansion ...... [REDACTED][REDACTED] Strategic acquisition of and [REDACTED][REDACTED] We plan to acquire or invest in property [REDACTED][REDACTED][REDACTED] investment in other management companies with business focus in property management Chengdu-Chongqing Economic Zone, Bohai companies Rim Economic Zone or Western Taiwan Strait

Economic OF USE AND PLANS ZoneFUTURE that (a) have an aggregated GFA under management of over 800,000 sq.m. or annual net profit margin of over 8.0% in the latest financial year; or (b) have diversified property portfolio such as residential properties, commercial properties, cultural and tourism properties, industrial parks, schools, hospitals and public properties.

Strategic acquisition of and [REDACTED][REDACTED] We plan to acquire or invest in commercial [REDACTED][REDACTED][REDACTED] investment in other services providers with business focus in commercial operational Chongqing, Jinan or Fuzhou that (a) have an services providers aggregated GFA under management of 50,000 sq.m. or above or annual net profit margin of 15.0% or above in the latest financial year; or (b) manage diversified commercial property portfolio such as shopping malls or shopping 1 – 316 – streets, or commercial projects which have higher growth potential. [ REDACTED ] EDI OJNTO IHTESCINHAE WRIG NTECVRO HSDOCUMENT. THIS BE OF MUST COVER INFORMATION THE THE ON THAT “WARNING” AND HEADED CHANGE SECTION TO THE SUBJECT WITH AND CONJUNCTION INCOMPLETE IN FORM, READ DRAFT IN IS DOCUMENT THIS

Strategic acquisition of and [REDACTED][REDACTED] We plan to acquire or invest in companies that [REDACTED][REDACTED][REDACTED] investment in companies can create synergies with our community that can create synergy value-added services and smart management effect with our system and, in particular, companies that (a)

community value-added have business OF USE AND PLANS FUTURE focus on community services and smart value-added services and smart management management system platform, such as smart community, health and elderly care, catering and housekeeping; or (b) have stable customer base and cash flow; or (c) have well-developed management systems.

2. Upgrade of information [REDACTED][REDACTED] Upgrade of our property [REDACTED][REDACTED] (i) Upgrading our Intelligent Property [REDACTED][REDACTED][REDACTED] systems and smart platforms . . management information Management Platform. We plan to establish system our own server and store the system and data of our intelligent property management platform on our own server. In addition, we also plan to enhance the key functions of our intelligent property management platform, primarily by developing new functions such as statistics report management, system function

1 – 317 – optimisation, third-party system integration and staff portal customisation. [ REDACTED ] EDI OJNTO IHTESCINHAE WRIG NTECVRO HSDOCUMENT. THIS BE OF MUST COVER INFORMATION THE THE ON THAT “WARNING” AND HEADED CHANGE SECTION TO THE SUBJECT WITH AND CONJUNCTION INCOMPLETE IN FORM, READ DRAFT IN IS DOCUMENT THIS

(ii) Upgrading our Intelligent Community Facilities Management System and IoT Hardware. We plan to upgrade our intelligent community facilities

management OF USE AND PLANS FUTURE system and IoT hardware through the following measures:

• upgrading our online facilities monitoring system to continuously monitor environmental temperature, humidity, current, voltage and other indicators, remotely monitor the operating status of various facilities and equipment in real time, and automatically record operating data, reducing the human resource allocation for on-site inspection of facilities and equipment . It can improve the quality of monitoring of our facilities and equipment and reduce the operational risks of our 1 – 318 – facilities and equipment; [ REDACTED ] EDI OJNTO IHTESCINHAE WRIG NTECVRO HSDOCUMENT. THIS BE OF MUST COVER INFORMATION THE THE ON THAT “WARNING” AND HEADED CHANGE SECTION TO THE SUBJECT WITH AND CONJUNCTION INCOMPLETE IN FORM, READ DRAFT IN IS DOCUMENT THIS

• upgrading our security system, which can integrate our online intelligent facilities monitoring system to monitor the entrances and exits, the operation

of OF USE AND PLANS ourFUTURE security system and the working conditions of our employees. It can also integrate facial recognition systems at main entrances and exits of the properties we manage to improve safety and management efficiency; and

• upgrading our vehicle monitoring system to connect the parking lots we manage with the intelligent property management platform through IoT, so that we can monitor the operation of the parking lots, receive fault reports and provide online payment services. 1 – 319 – [ REDACTED ] EDI OJNTO IHTESCINHAE WRIG NTECVRO HSDOCUMENT. THIS BE OF MUST COVER INFORMATION THE THE ON THAT “WARNING” AND HEADED CHANGE SECTION TO THE SUBJECT WITH AND CONJUNCTION INCOMPLETE IN FORM, READ DRAFT IN IS DOCUMENT THIS

(iii) Upgrading Xiaohui Dangjia Smart Community Service Platform. We plan to upgrade and optimise the user experience of the existing functions of the Xiaohui Dangjia Smart

Community OF USE AND PLANS FUTURE Service Platform, primarily through:

• optimising online payment experience of property management fee and including additional online payment options;

• integrating community blackboard functions, such as news posting, community comments, and community activities registration. Users can post their ideas or ask for help under the community blackboard and interact with other users; 2 – 320 – [ REDACTED ] EDI OJNTO IHTESCINHAE WRIG NTECVRO HSDOCUMENT. THIS BE OF MUST COVER INFORMATION THE THE ON THAT “WARNING” AND HEADED CHANGE SECTION TO THE SUBJECT WITH AND CONJUNCTION INCOMPLETE IN FORM, READ DRAFT IN IS DOCUMENT THIS

• integrating the purchase, sales and storage functions, such as inventory counting, real-time records of product circulation, and data report statistics. It

can OF USE AND PLANS FUTURE provide comprehensive control of daily inventory and other tasks, keeping up-to-date inventory information at any time and effectively avoid inventory backlog or shortage phenomenon.

Upgrade of our commercial [REDACTED][REDACTED] We plan to upgrade our commercial operational [REDACTED][REDACTED][REDACTED] operational information information system mainly in the following system methods:

(i) Upgrading our Commercial Operational Management Platform. We plan to upgrade our commercial operational management platform mainly through the following methods:

2 – 321 – • optimising the information exchange between the commercial membership platform and the merchant operating platform, which can perform member data analysis based on the data collected from the commercial member platform; [ REDACTED ] EDI OJNTO IHTESCINHAE WRIG NTECVRO HSDOCUMENT. THIS BE OF MUST COVER INFORMATION THE THE ON THAT “WARNING” AND HEADED CHANGE SECTION TO THE SUBJECT WITH AND CONJUNCTION INCOMPLETE IN FORM, READ DRAFT IN IS DOCUMENT THIS

Amount of [REDACTED] by timeframe Percentage Percentage of 2021 2022 2023 of total Amount of total Amount of (HK$ in (HK$ in (HK$ in Major categories [REDACTED] [REDACTED] Sub-categories [REDACTED] [REDACTED] Implementation plan millions) millions) millions) • upgrading the marketing and promotion functions of the membership system to allow registered members to obtain various gift cards and coupons provided by merchants

through OF USE AND PLANS FUTURE the membership system. Customers can also receive the latest business updates such as promotional activities and commercial promotion announcements according to their own preferences; and

(ii) Establishing the Commercial Customer Flow Statistics System. We plan to establish a commercial customer flow statistics system, 2 – 322 – which can monitor commercial passenger flow in real time, collect ambient data and monitor the commercial areas we manage. It can be connected to our commercial operational management platform to establish the monitoring of important business data of our business operation services, so as to improve our ability to analyse business data and improve the

performance[ of our business operation services;REDACTED and ] EDI OJNTO IHTESCINHAE WRIG NTECVRO HSDOCUMENT. THIS BE OF MUST COVER INFORMATION THE THE ON THAT “WARNING” AND HEADED CHANGE SECTION TO THE SUBJECT WITH AND CONJUNCTION INCOMPLETE IN FORM, READ DRAFT IN IS DOCUMENT THIS

(iii) Establishing the Grand Membership System. We plan to establish a grand membership system which can connect our property management information system and

commercial OF USE AND PLANS FUTURE operational information system and share membership benefits across these systems, so as to create additional commercial value through multi-business cooperation. 2 – 323 – [ REDACTED ] EDI OJNTO IHTESCINHAE WRIG NTECVRO HSDOCUMENT. THIS BE OF MUST COVER INFORMATION THE THE ON THAT “WARNING” AND HEADED CHANGE SECTION TO THE SUBJECT WITH AND CONJUNCTION INCOMPLETE IN FORM, READ DRAFT IN IS DOCUMENT THIS

Upgrade of our internal [REDACTED][REDACTED] We plan to upgrade our internal management [REDACTED][REDACTED][REDACTED] management system system and core data management platform, mainly through upgrading our video conferencing system, file management system,

office automation OF USE AND PLANS FUTURE system, human resource system, financial management system and other management systems by purchasing third-party hardware and software, so as to reduce human errors and provide our management with the latest operating performance through data analysis and improve the efficiency of business management. 2 – 324 – [ REDACTED ] EDI OJNTO IHTESCINHAE WRIG NTECVRO HSDOCUMENT. THIS BE OF MUST COVER INFORMATION THE THE ON THAT “WARNING” AND HEADED CHANGE SECTION TO THE SUBJECT WITH AND CONJUNCTION INCOMPLETE IN FORM, READ DRAFT IN IS DOCUMENT THIS

3. Diversifying or upgrade [REDACTED][REDACTED] Development of new [REDACTED][REDACTED] We plan to identify appropriate venues in our [REDACTED][REDACTED][REDACTED] value-added services ...... value-added services community and set up health and elderly care centres. We also plan to provide home elderly care services that combine medical care and

elderly care. OF USE AND PLANS FUTURE

We plan to identify appropriate venues in or around the community and set up community restaurants to provide healthy meals for property owners, residents and other customers.

We plan to provide marketing services for our commercial customers and customised private activities to meet the needs of our residential customers for better quality of living experience. 2 – 325 – [ REDACTED ] EDI OJNTO IHTESCINHAE WRIG NTECVRO HSDOCUMENT. THIS BE OF MUST COVER INFORMATION THE THE ON THAT “WARNING” AND HEADED CHANGE SECTION TO THE SUBJECT WITH AND CONJUNCTION INCOMPLETE IN FORM, READ DRAFT IN IS DOCUMENT THIS

Upgrade of existing [REDACTED][REDACTED] We plan to open offline community stores for [REDACTED][REDACTED][REDACTED] value-added services convenient group buying. We also plan to purchase the required equipment to expand the supply chain for more categories of

products OF USE and AND PLANS FUTURE promote our group buying services through various marketing activities.

We plan to increase the purchase of professional facilities and equipment and expand our professional team to improve our service capacity and quality for engineering and repair services and housekeeping services.

We plan to expand the scope of our sales agency services, recruit more professionals with relevant experience, establish an asset management information management platform and more effectively manage housing brokerage information and internal processes, so as to optimise customer experience.

2 – 326 – 4. Working capital ...... [REDACTED][REDACTED] Working capital and other [REDACTED][REDACTED] We expect to fund our capital needs and cash [REDACTED][REDACTED][REDACTED] general corporate flow under our existing business. purpose

Total ...... [REDACTED][REDACTED][REDACTED][REDACTED][REDACTED][REDACTED][REDACTED] [ 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. FUTURE PLANS AND USE OF [REDACTED]

Plans for Strategic Acquisitions and Investments

Criteria for Strategic Acquisitions and Investments

Although our Directors had not identified any suitable targets as at the Latest Practicable Date, we have determined the criteria for evaluating potential targets based on the results of our constant research, financial due diligence and preliminary assessments in this regard. Please refer to the paragraph headed “– [REDACTED]” above for further details for our criteria for strategic acquisitions and investments.

Availability of Suitable Targets

According to CIA, with nearly 200,000 property management companies operating in the PRC in 2020, accelerated market concentration is a key trend in the highly competitive and fragmented PRC property management industry, and leading property management service providers are seeking access to enhance management standards and core competitiveness through mergers and acquisitions. The total capital required for the acquisition of, or investment in, such potential targets would depend, to a large extent, on the size and number of the targets. The determination of investment cost for each target is further subject to the percentage of equity interest to acquire, operation scale of the target, the financial performance and position of the target and our evaluation of the target’s worthiness and potential with reference to the market value. As advised by CIA, our Directors believe that our criteria for strategic acquisitions and investments are in line with the industry practice and there are a rich variety of potential targets available for our consideration in such fragmented property management service and commercial operational industries. Leveraging the trend of industry consolidation, our established market position and extensive industrial experience, as well as efforts of our professional business development teams, we believe that we may find suitable targets for our acquisition and investment plan will be able to implement our acquisition and investment strategies successfully.

As at the Latest Practicable Date, we had not identified or committed to any acquisition or investment targets. Based on our calculation, we plan to acquire/invest in two to five companies, including property management companies, commercial operational services providers or companies that can create synergies with our community value-added services and smart management system, before 2023 with the [REDACTED]fromthe[REDACTED]. If the considerations to be paid for these acquisitions and investments exceed the [REDACTED]from the [REDACTED], we believe that we will be able to utilise the funds from other sources to finance the acquisitions and investments.

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Cost-Benefit Analysis for Strategic Acquisitions and Investments

According to CIA, while the property management market in China is becoming increasingly concentrated, the PRC property management industry is still fragmented and competitive. In addition, the commercial operational market is relatively fragmented. Large-scale property management companies or commercial operational services companies actively improve their strategic layout and accelerate their business expansion in order to increase their market shares and achieve better results of operations, primarily through organic growth as well as strategic acquisitions and investments. Moreover, we believe companies with specialised value-added services can provide valuable experience and customer base that can create synergy with our existing services and develop innovative new value-added service. Our Directors are of the view that the strategic acquisition and investments will be beneficial to our business strategy to further expand our business scale and market share based on the following analysis:

• Minimising the time required for organic growth

On one hand, based on our past experience, it generally takes six to 12 months for us to expand our property management services or commercial operational services portfolio by way of organic growth, comprising (i) approximately three months for onsite inspection of the target market where it is a new market; (ii) approximately one month for the establishment of the branch company or subsidiary for a new market; (iii) approximately two to three months for conducting business development activities to obtain property projects; and (iv) approximately three to six months for taking over existing property projects, recruitment and training of employees. On the other hand, based on our research and internal study, our Directors estimate that it generally takes approximately three to nine months to complete an acquisition or investment in a property management or commercial operational services company, depending on the complexity, location, scale and service offerings of the target company, comprising (i) approximately one to six months for the valuation, due diligence and negotiation; (ii) approximately one to two months for execution of relevant agreements; and (iii) approximately one month for integrating the management team of the acquired company into our system. Our Directors are of the view that strategic acquisitions and investments are more time efficient for the purpose of expanding our presence.

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• Minimising the uncertainties and additional costs associated with organic growth

We believe that when we expand our business through organic growth, we may face many uncertainties in local/regional social culture and market environment, which may require more time to adapt to the differences and further extend the payback period for the costs incurred. In addition, in seeking to obtain new projects as part of our organic growth, we face the uncertainties of not being able to fully understand or match the requirements of new customers thereby risk losing tenders to parties who may have a past or existing relationship with those customers. In some cases, we may also have to sacrifice our profit margins to win tenders for projects to compensate for a lack of past relationship or understanding with the relevant customer.

Alternatively, strategic acquisition and investment not only can effectively save time for expanding our service network, but also increase our technical and managerial talents, help to adapt our management model based on the local social culture and market environment, control the risks associated with new projects or long-distance management and save monetary costs. In addition, our Directors consider that the acquisition or investment will also allow us to diversify our customer base as we will have convenient access to the existing customer base of the target companies upon acquisition or investment. Inheriting existing projects that have been managed by the target company will avoid the risks and uncertainties in respect of bidding for new projects as described above and expand our revenue stream in a short period of time. Such expansion method also enhances resource utilisation, resulting in better market resource allocation, resource sharing and stronger business alliances.

Compared with organic growth to new markets, strategic acquisitions and investments can secure a more stable source of income and predictable investment payback with reference to the financial performance and the existing customer base of the targets. We will conduct valuation and due diligence on the target companies to make sure the investment payback. However, if we decide to grow our business organically especially in new markets, there is no objective and reliable benchmark for us to estimate the timeframe required for achieving investment payback in relation to the cost of recruiting, retaining and/or training up the relevant personnel and skilled workers because of our lack of an established customer base in the new markets.

Although we had been expanding our business primarily through organic growth since inception, we believe that expansion through strategic acquisitions and investments will enable us to gain access to new markets faster, expand our market share in our existing markets and expand our property management or commercial operational services portfolio in an efficient and secured manner, and therefore constitute an alternative way to effectively achieve our business strategy to further expand our business scale and market share.

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The following is the text of a report set out on pages I-1 to I-59, received from the Company’s reporting accountant, Grant Thornton Hong Kong Limited, 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 Sole Sponsor 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 RONGHUI JOY LIFE GROUP LIMITED

Introduction

We report on the historical financial information of RongHui Joy Life Group Limited (the “Company”) and its subsidiaries (together, the “Group”) set out on pages I-4 to I-59, which comprises the combined statements of financial position of the Group as at 31 December 2018, 2019 and 2020, and the combined statements of profit or loss and other comprehensive income, the combined statements of changes in equity and the combined statements of cash flows of the Group for each of the years ended 31 December 2018, 2019 and 2020 (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-59 forms an integral part of this report, which has been prepared for inclusion in the document of the Company dated [date] (the “Document”) in connection with the [REDACTED] of 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 the Historical Financial Information that gives a true and fair view in accordance with the basis of presentation and reorganisation and basis of preparation set out in Notes 1.2 and 2.1 to the Historical Financial Information, respectively, and for such internal control as the directors determine is necessary to enable the preparation of the Historical Financial Information that is free from material misstatement, whether due to fraud or error.

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 (the “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.

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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 judgement, 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 presentation and reorganisation and basis of preparation set out in Notes 1.2 and 2.1 to the Historical Financial Information, respectively, 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 purpose of the accountant’s report, a true and fair view of the Group’s combined financial position as at 31 December 2018, 2019 and 2020 and of the Group’s combined financial performance and combined cash flows for the Track Record Period in accordance with the basis of presentation and reorganisation and basis of preparation set out in Notes 1.2 and 2.1 respectively to the Historical Financial Information.

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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 Underlying Financial Statements as defined on page I-4 have been made.

Dividends

We refer to Note 10 to the Historical Financial Information which states that no dividends was declared or paid by the Company in respect of the Track Record Period.

No statutory financial statements for the Company

No statutory financial statements have been prepared for the Company since its date of incorporation.

Grant Thornton Hong Kong Limited Certified Public Accountants Level 12 28 Hennessy Road Wanchai Hong Kong [Date]

[Practising Certificate No.: [●]]

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I. HISTORICAL FINANCIAL INFORMATION

Preparation of Historical Financial Information

Set out below is the Historical Financial Information which forms an integral part of this accountant’s report.

The combined financial statements of the Group for the Track Record Period, on which the Historical Financial Information is based, were audited by Grant Thornton Hong Kong Limited in accordance with Hong Kong Standards on Auditing issued by the HKICPA (“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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(A) COMBINED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

Year ended 31 December Notes 2018 2019 2020 RMB’000 RMB’000 RMB’000

Revenue 4 198,905 224,215 241,351 Cost of sales (152,653) (166,370) (165,507)

Gross profit 46,252 57,845 75,844 Other (losses)/gains, net 5 (1,006) 5,580 16,690 Administrative expenses (22,553) (21,146) (26,467) [REDACTED]-related expenses – – [REDACTED]

Operating profit 22,693 42,279 64,986 Share of results of a joint venture 15 14 86 99 Finance income 221 302 133 Finance costs (45) (8) (25)

Finance income, net 8 176 294 108

Profit before income tax 6 22,883 42,659 65,193 Income tax expense 9 (4,390) (7,072) (11,015)

Profit and total comprehensive income for the year 18,493 35,587 54,178

Profit and total comprehensive income attributable to: Equity holders of the Company 17,653 33,360 50,520 Non-controlling interests 840 2,227 3,658

18,493 35,587 54,178

Earnings per share attributable to equity holders of the Company (expressed in RMB per share) Basic and diluted 11 N/A N/A N/A

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(B) COMBINED STATEMENTS OF FINANCIAL POSITION

As at 31 December Notes 2018 2019 2020 RMB’000 RMB’000 RMB’000

Non-current assets Property, plant and equipment 13 2,504 2,214 2,776 Intangible assets 14 531 821 1,005 Investment in a joint venture 15 1,014 1,100 1,199 Right-of-use assets 16 322 29 1,184 Prepayment 18 ––16 Deferred tax assets 23 1,803 750 853

6,174 4,914 7,033

Current assets Inventories 17 864 713 572 Trade and other receivables 18 314,345 412,063 471,372 Financial assets at fair value through profit or loss (“FVTPL”) 19 8,429 12,847 – Income tax recoverable 620 2,794 842 Bank balances and cash 20 92,827 45,997 74,733

417,085 474,414 547,519

Current liabilities Contract liabilities 4 37,172 47,273 52,511 Trade and other payables 21 110,401 105,435 113,623 Lease liabilities 22 332 23 246 Income tax payable liabilities 1,754 1,698 8,889

149,659 154,429 175,269

Net current assets 267,426 319,985 372,250

Total assets less current liabilities 273,600 324,899 379,283

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As at 31 December Notes 2018 2019 2020 RMB’000 RMB’000 RMB’000

Non-current liabilities Lease liabilities 22 – – 918 Deferred tax liabilities 23 – 712 –

– 712 918

Net assets 273,600 324,187 378,365

EQUITY Share capital 24 252,231 265,912 265,912 Reserves 25 11,036 44,396 94,916

Equity attributable to the equity holders of the Company 263,267 310,308 360,828 Non-controlling interests 10,333 13,879 17,537

Total equity 273,600 324,187 378,365

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Attributable to equity holders of the Company (Accumulated losses)/ Non- Share Capital Statutory Retained controlling Total capital reserve* reserve* profits* Total interests equity RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 (Note 25) (Note 25)

Balance at 1 January 2018 252,231 48,600 2,002 (57,219) 245,614 9,493 255,107 Profit and total comprehensive income for the year – – – 17,653 17,653 840 18,493 Transactions with owners – Appropriation to statutory reserve – – 945 (945) – – –

Total transactions with owners – – 945 (945) – – –

Balance at 31 December 2018 and 1 January 2019 252,231 48,600 2,947 (40,511) 263,267 10,333 273,600 Profit and total comprehensive income for the year – – – 33,360 33,360 2,227 35,587 Transactions with owners – Appropriation to statutory reserve – – 2,617 (2,617) – – – – Issuance of share capital 13,681–––13,681 1,319 15,000

Total transactions with owners 13,681 – 2,617 (2,617) 13,681 1,319 15,000

Balance at 31 December 2019 and 1 January 2020 265,912 48,600 5,564 (9,768) 310,308 13,879 324,187 Profit and total comprehensive income for the year – – – 50,520 50,520 3,658 54,178 Transactions with owners – Appropriation to statutory reserve – – 5,431 (5,431) – – –

Total transactions with owners – – 5,431 (5,431) – – –

Balance at 31 December 2020 265,912 48,600 10,995 35,321 360,828 17,537 378,365

* The total of these amounts as at the reporting dates represents “Reserves” in the combined statements of financial position.

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(D) COMBINED STATEMENTS OF CASH FLOWS

Year ended 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Cash flows from operating activities Profit before income tax 22,883 42,659 65,193 Adjustments for: Amortisation of intangible assets 93 213 326 Depreciation of property, plant and equipment 1,109 1,126 987 Depreciation of right-of-use assets 633 339 135 Interest income (221) (302) (133) Finance cost 45 8 25 Provision for/(reversal of) impairment loss on trade and other receivables 3,279 (3,218) 808 Loss on disposal of property, plant and equipment 21 57 13 Loss/(gain) on fair value changes of financial assets at fair value through profit or loss 1,563 (4,411) – Gain on sales of financial assets at fair value through profit or loss – – (14,887) Dividend income (279) (299) (416) [REDACTED]-related expenses – – [REDACTED] Share results of a joint venture (14) (86) (99)

Operating profit before working capital changes 29,112 36,086 53,033 (Increase)/decrease in inventories (642) 151 141 Decrease/(increase) in trade and other receivables 13,810 5,065 (18,188) Increase in contract liabilities 5,842 10,101 5,238 Increase in trade and other payables 9,426 4,160 6,927

Cash generated from operations 57,548 55,563 47,151 Income tax paid (4,241) (7,537) (2,687)

Net cash generated from operating activities 53,307 48,026 44,464

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Year ended 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Cash flows from investing activities Investment in a joint venture (1,000) – – Purchase of property, plant and equipment (731) (893) (1,565) Purchase of intangible assets (547) (503) (510) Proceeds from disposal of property, plant and equipment – – 3 Proceeds from disposal of financial assets at fair value through profit or loss – – 27,734 Advance to amounts due from related parties (17,091) (99,565) (41,945) Purchase of financial assets at fair value through profit or loss (9,992) (7) – Dividend received 279 299 416 Interest received 221 302 133

Net cash used in investing activities (28,861) (100,367) (15,734)

Cash flows from financing activities Advance from/(Repayment to) amounts due to related parties 14,443 (9,126) 500 Issuance of share capital – 15,000 – Repayment of lease liabilities (617) (355) (149) Interest paid on lease liabilities (45) (8) (25) [REDACTED]-related expenses paid – – [REDACTED]

Net cash generated from financing activities 13,781 5,511 6

Net increase/(decrease) in cash and cash equivalents 38,227 (46,830) 28,736 Cash and cash equivalents at beginning of year 54,600 92,827 45,997

Cash and cash equivalents at end of year, represented by bank balances and cash 92,827 45,997 74,733

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II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION

1. GENERAL INFORMATION AND BASIS OF PRESENTATION

1.1 General information

RongHui Joy Life Group Limited (the “Company”) was incorporated in the Cayman Islands on 1 February 2021 as an exempted company with limited liability under the Cayman Islands Company Law. The address of the Company’s registered office is 4th Floor, Harbour Place, 103 South Church Street, P.O. Box 10240, Grand Cayman, KY1-#1002, Cayman Islands.

The Company is an investment holding company and its subsidiaries (collectively, the “Group”) are principally engaged in the provision of property management services and commercial operational services in the People’s Republic of China (the “PRC”) (the “[REDACTED] Business”).

Prior to the completion of the reorganisation (the “Reorganisation”), the [REDACTED] Business were carried out by Chongqing Ronghui Commercial Management Co. Ltd., Shandong Ronghui Laoshangbu Commercial Operation Management Co., Ltd., Fuzhou Ronghui Real Estate Co., Ltd., Shandong Ronghui Creative Cultural Industry Co., Ltd, Chongqing Ronghui Property Management Co., Ltd., Fujian Ronghui Property Management Co., Ltd., and Chongqing Ronghui Guanling Commercial Real Estate Operation Management Co., Ltd. The above mentioned companies comprising the Group are under the control of Mr. Wong Cho Shi and Ms. Chan Sun Ping (the “Controlling Shareholders). The Reorganisation involved combinations of entities under common control of the Controlling Shareholders before and immediately after the Reorganisation. Consequently, immediate after the Reorganisation, there was a continuation of the risks and benefits to Controlling Shareholders that existed prior to the Reorganisation. Accordingly, the Historical Financial Information has been prepared by applying the principles of merger accounting in accordance with the Accounting Guideline No. 5, “Merger Accounting for Common Control Combinations” issued by the Hong Kong Institute of Certified Public Accountants (the “HKICPA”). Details of the basis of preparation in note 1.3.

The Company and its subsidiaries now comprising the Group underwent the Reorganisation as detailed in the section headed “History, reorganisation and corporate structure” to the Document, the Reorganisation was completed on 3 June 2021.

Upon the completion of the Reorganisation and as at the date of this report, the Company had direct or indirect interests in the following subsidiaries and a joint venture:

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Upon completion of the Reorganization and as at the date of this report, the Company had direct or indirect material interests REPORT ACCOUNTANTS’ in the following subsidiaries and a joint I APPENDIX venture: Country/place and date of Issued and incorporation/ paid-up capital/ Name of company establishment registered capital Equity interest held Principal activities Note As at 31 December The date of this 2018 2019 2020 report

Directly held by the Company Ronghui City Wisdom Co., Ltd. The British Virgin US$100 – – – 100% Investment holding a Islands (“BVI”)/ 3 February 2021

Indirectly held by the Company Hong Kong Ronghui Joy Life Co., Ltd. Hong Kong/ HK$10,000 – – – 100% Investment holding a -2– I-12 – 18 February 2021 Chongqing Ronghui Jiayue Corporate The PRC/ RMB10,000,000 – – – 100% Investment holding a Management Co., Ltd. 4 March 2021 (重慶融匯家悅企業管理有限公司) Chongqing Ronghui Youjia Smart Life The PRC/ RMB100,000,000 – – – 100% Investment holding a Services Co., Ltd. 12 January 2021 (重慶融匯優家智慧生活服務有限公司) Chongqing Ronghui Property The PRC/ 2018: 91.2% 91.2% 91.2% 100% Property management b Management Co., Ltd. 23 June 2006 RMB5,000,000 (重慶融匯物業管理有限公司) 2019 & 2020: RMB20,000,000 Fujian Ronghui Property Management The PRC/ RMB5,000,000 100% 100% 100% 100% Property management a Co., Ltd. 22 January 2007 (福建融匯物業管理有限公司) Chongqing Ronghui Guanling The PRC/ RMB160,000,000 100% 100% 100% 100% Property management a Commercial Real Estate Operation 2 May 2013 Management Co., Ltd. (重慶融匯冠嶺商業地產營運管理有限公司) Chongqing Ronghui Commercial The PRC/ RMB10,000,000 91.2% 91.2% 91.2% 100% Property management a Management Co., Ltd. 12 October 2012 (重慶融匯商業管理有限公司) EDI OJNTO IHTESCINHAE WRIG NTECVRO HSDOCUMENT. THIS BE OF MUST COVER INFORMATION THE THE ON THAT “WARNING” AND HEADED CHANGE SECTION TO THE SUBJECT WITH AND CONJUNCTION INCOMPLETE IN FORM, READ DRAFT IN IS DOCUMENT THIS

Country/place and REPORT ACCOUNTANTS’ I APPENDIX date of Issued and incorporation/ paid-up capital/ Name of company establishment registered capital Equity interest held Principal activities Note As at 31 December The date of this 2018 2019 2020 report

Fuzhou Ronghui Real Estate Co., Ltd. ( The PRC/ RMB8,000,000 100% 100% 100% 100% Property management a 福州融匯置業有限公司) 25 August 2008 Shandong Ronghui Creative Cultural The PRC/ RMB60,000,000 86.6% 86.6% 86.6% 100% Property management a Industry Co., Ltd. 23 July 2012 (山東融匯創意文化產業有限公司) Shandong Ronghui Laoshangbu The PRC/ RMB5,000,000 91.2% 91.2% 91.2% 100% Property management a Commercial Operation Management 17 July 2012 Co., Ltd. (山東融匯老商埠商業運營管理有限公司) -3– I-13 – Joint venture Fuzhou Funeng Ronghui Property The PRC/ RMB5,000,000 50% 50% 50% 50% Property management a Management Co., Ltd. 21 December 2017 (福州福能融匯物業管理有限公司)

Notes:

(a) No audited financial statements were issued for these companies as they were newly incorporated or not required to issue audited financial statements under the statutory requirement of their respective places of incorporation.

(b) The statutory auditor of the subsidiary is 重慶海特會計師事務所有限公司 for the years ended 31 December 2018, 2019 and 2020.

(c) Wuhu Ronghui Trading Co., Ltd. (蕪湖融匯商貿有限公司) was de-registered on 8 December 2020 and Wuhu Ronghui Property Management Co., Ltd. (蕪湖融匯物業管理有限公司) was disposed on 9 February 2021.

The English names of certain companies referred herein represent management’s best effort at translating the Chinese names of these companies as no English name has been registered.

All companies comprising the Group have adopted 31 December as their financial year end date. 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 ACCOUNTANTS’ REPORT

1.2 Basis of presentation and reorganisation

Pursuant to the Reorganisation as more fully explained in the paragraph headed “Reorganisation” in the section headed “History, reorganisation and corporate structure” in the Document, the Company became the holding company of the operating companies now comprising the Group on 3 June 2021. The Company has not been involved in any other business prior to the Reorganisation. The Reorganisation is merely a reorganisation of the [REDACTED] Business with no change in management of such business and the Controlling Shareholder of the [REDACTED] Business remain the same. No adjustments are made to reflect fair values, or recognise any new assets or liabilities as a result of the Reorganisation.

Intercompany transactions, balances and unrealised gains/losses on transactions between group companies are eliminated on combination.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of the Historical Financial Information are set out below. These policies have been consistently applied throughout the Track Record Period, unless otherwise stated.

2.1 Basis of preparation

The Historical Financial Information has been prepared in accordance with accounting policies which conform with the Hong Kong Financial Reporting Standards (“HKFRSs”), which collective term includes all applicable individual Hong Kong Financial Reporting Standards, Hong Kong Accounting Standards (“HKASs”) and Interpretations issued by the HKICPA. The Historical Financial Information also complies with the applicable disclosure requirements of the Hong Kong Companies Ordinance and the Rules Governing the Listing of Securities on the Stock Exchange (the “Listing Rules”).

The HKICPA has issued a number of new and amended HKFRSs which are relevant to the Group and became effective during the Relevant Periods. For the purpose of preparing and presenting the Historical Financial Information for the Relevant Periods, the Group has adopted all new and amended HKFRSs that are effective during the Relevant Periods and has applied them consistently throughout the Relevant Periods. The Historical Financial Information has been prepared on the historical cost basis.

It should be noted that accounting estimates and assumptions are used in preparation of the Historical Financial Information. Although these estimates are based on the management’s best knowledge and judgement of current events and actions, actual results may ultimately differ from those estimates.

The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the Historical Financial Information are disclosed in Note 3 below.

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2.1.1 Issued but not effective HKFRSs

Certain new and amended HKFRSs have been published but are not yet effective, and have not been adopted early by the Group:

HKFRS 17 Insurance Contracts and related amendments5 Amendments to HKFRS 3 Reference to the Conceptual Framework6 Amendments to HKFRS 9, HKAS 39, Interest Rate Benchmark Reform — phase 23 HKFRS 7, HKFRS 4 and HKFRS 16 Amendments to HKFRS10 and HKAS 28 Sale or Contribution of Assets between an Investor and its Associate or Joint Venture1 Amendment to HKFRS 16 Covid-19-Related Rent Concessions2 Amendment to HKFRS 16 Covid-19-Related Rent Concessions beyond 30 June 20217 Amendments to HKAS 1 Classification of Liabilities as Current or Non-current and related amendments to Hong Kong Interpretation (2020)5 Amendments to HKAS 1 and HKFRS Disclosure of Accounting Policies5 Practice Statement 2 Amendments to HKAS 8 Definition of Accounting Estimates5 Amendments to HKAS 16 Property, Plant and Equipment — Proceeds before Intended Use4 Amendments to HKAS 37 Onerous Contracts — Cost of Fulfilling a Contract4 Amendments to HKFRSs Annual Improvements to HKFRSs 2018-20204

1 Effective date not yet determined 2 Effective for annual periods beginning on or after 1 June 2020 3 Effective for annual periods beginning on or after 1 January 2021 4 Effective for annual periods beginning on or after 1 January 2022 5 Effective for annual periods beginning on or after 1 January 2023 6 Effective for business combinations for which the acquisition date is on or after the beginning of the first annual period beginning on or after 1 January 2022 7 Effective for annual periods beginning on or after 1 April 2021

The directors anticipate that all of the new and amended HKFRSs will be adopted in the Group’s accounting policy for the first period beginning on or after the effective date of the new and amended HKFRSs. These new and amended HKFRSs are not expected to have a material impact on the Historical Financial Information.

2.2 Basis of consolidation and combination

The Historical Financial Information incorporates the financial information of the Company and its subsidiaries made up to respective year end dates during the Track Record Period.

Subsidiaries are entities controlled by the Group. The Group controls an entity when the Group is exposed, 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. When assessing whether the Group has power over the entity, only substantive rights relating to the entity (held by the Group and others) are considered.

The Group includes the income and expenses of subsidiaries in the Historical Financial Information from the date it gains control until the date when the Group ceases to control the subsidiary.

Intra-group transactions, balances and unrealised gains and losses on transactions between group companies are eliminated. Amounts reported in the financial statements of subsidiaries have been adjusted where necessary to ensure consistency with the accounting policies adopted by the Group.

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Non-controlling interests represent the equity on a subsidiary not attributable directly or indirectly to the Company, and in respect of which the Group has not agreed any additional terms with the holders of those interests which would result in the Group as a whole having a contractual obligation in respect of those interests that meets the definition of a financial liability. For each business combination, the Group can elect to measure any non-controlling interests either at fair value or at their proportionate share of the subsidiary’s net identifiable assets.

Non-controlling interests are presented in the combined statement of financial position within equity, separately from the equity attributable to the owners of the Company. Non-controlling interests in the results of the Group are presented on the face of the combined statement of profit or loss and other comprehensive income as an allocation of the total profit or loss and total comprehensive income for the year between non- controlling interests and the owners of the Company.

Business combinations under common control

The Historical Financial Information incorporates the financial statement items of the entities or businesses in which the common control combination occurs as if they had been combined from the date when the entities or businesses first came under the control of the controlling party.

The net assets of the combining entities or businesses are combined using the existing book values from the controlling party’s perspective. No amount is recognised in consideration for goodwill or excess of acquirer’s interest in the net fair value of acquirer’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 combined statements of profit or loss and other comprehensive income include 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 transactions, balances and unrealised gains on transactions between combining entities or businesses are eliminated.

In the Company’s statement of financial position, subsidiaries are carried at cost less any impairment loss unless the subsidiary is held for sale or included in a disposal group. Cost also includes direct attributable costs of investment.

The results of subsidiaries are accounted for by the Company on the basis of dividends received and receivable at the reporting date. All dividends whether received out of the investee’s pre or post-acquisition profits are recognised in the Company’s profit or loss.

2.3 Foreign currency translation

(a) Functional and presentation currency

Items included in the financial information 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”). The Historical Financial Information are presented in RMB, which is the same as the Company’s functional currency.

(b) 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 year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the profit or loss.

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The results and financial position of all the group entities (none of which has the currency of a hyper-inflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

• assets and liabilities for each statement of financial position presented are translated at the closing rate at the date of that statement of financial position;

• income and expenses for each statement of profit or loss and other comprehensive income are translated at average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the rate on the dates of the transactions); and

• all resulting currency translation differences are recognised in other comprehensive income.

2.4 Joint venture

A joint venture is a type of joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the arrangement. Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions relating about relevant activities require the unanimous consent of the parties sharing control.

In combined financial statements, an investment in a joint venture is initially recognised at cost and subsequently accounted for using the equity method.

Under the equity method, the Group’s interest in the joint venture is carried at cost and adjusted for the post-acquisition changes in the Group’s share of the joint venture’s net assets less any identified impairment loss, unless it is classified as held for sale (or included in a disposal group that is classified as held for sale). The profit or loss for the year includes the Group’s share of the post-acquisition, post-tax results of the joint venture for the year, including any impairment loss on the investment in joint venture recognised for the year. The Group’s other comprehensive income for the year includes its share of the joint venture’s other comprehensive income for the year.

2.5 Property, plant and equipment

Property, plant and equipment (other than construction-in-progress) are stated at cost less accumulated depreciation and accumulated impairment losses. The cost of an item of property, plant and equipment comprises its purchase price and any directly attributable costs of bringing the asset to its working condition and location for its intended use.

Properties in the course of construction for production, supply or administrative purposes are carried at cost, less any recognised impairment loss. Costs include professional fees and, for qualifying assets, borrowing costs capitalised in accordance with the Group’s accounting policy. Such properties are classified to the appropriate categories of property, plant and equipment when completed and ready for intended use. Depreciation of these assets, on the same basis as other property assets, commences when the assets are ready for their intended use.

Depreciation on assets other than construction-in-progress is provided to write off the cost less their residual values over their estimated useful lives, using the straight-line method, as follows:

Machineries 20%-33.3% Furniture and fixtures and office equipment 20%-33.3% Motor vehicles 20%-33.3% Leasehold improvements 20% or over the remaining term of the lease, if shorter

The assets’ depreciation methods, residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each of the Track Record Period.

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The gain or loss arising on retirement or disposal is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in profit or loss.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. All other costs, such as repairs and maintenance, are charged to profit or loss during the financial period in which they are incurred.

2.6 Intangible assets

Acquired software licences are capitalised on the basis of the costs incurred to acquire and bring to use the specific software. These costs are amortised over their estimated useful lives (2-5 years). Amortisation commences when the intangible assets are available for use.

After initial recognition, intangible assets are carried at cost less accumulated amortisation and any accumulated impairment losses.

The assets’ amortisation methods and useful lives are reviewed, and adjusted if appropriate, at each of the Track Record Period.

2.7 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 amortised cost.

The classification depends on the Group’s business model for managing the financial assets and the contractual terms of the cash flows.

For 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, 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.

The Group reclassifies debt investments when and only when its business model for managing those assets changes.

ii) Recognition and measurement

At initial recognition, the Group measures a financial asset at its fair value plus, in 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.

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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 two measurement categories into which the Group classifies its debt instruments:

• Amortised 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 amortised cost. A gain or loss on a debt investment that is subsequently measured at amortised cost and is not part of a hedging relationship is recognised in the profit or loss presented in “Finance costs, net” when the asset is derecognised or impaired. Interest income from these financial assets is calculated using the effective interest rate method.

• Fair value through profit or loss: Assets that do not meet the criteria for amortised cost or financial assets at fair value through other comprehensive income are measured at fair value through profit or loss. A gain or loss on a debt instruments that is subsequently measured at fair value through profit or loss and is not part of a hedging relationship is recognised in profit or loss and presented net within profit or loss in the period in which it arises.

iii) Derecognition of financial assets

The Group derecognises a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred or in which the Group neither transfers nor retains substantially all of the risks and rewards of ownership and it does not retain control of the financial asset.

2.8 Impairment of financial assets

The Group assesses on a forward -looking basis the expected credit losses (“ECL”) associated with its assets carried at amortised cost. 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 required lifetime ECL to be recognised from initial recognition of the trade receivables. When the assessment is performed on a collective basis, the financial instruments are grouped based on shared credit risk characteristics, such as past due status and credit risk ratings.

Impairment on other receivables are measured as either 12-month ECL or lifetime ECL, depending on whether there has been a significant increase in credit risk since initial recognition. If a significant increase in credit risk of a receivable has occurred since initial recognition, then impairment is measured as lifetime ECL.

Impairment on bank balances are considered to be insignificant because the counterparties are banks/financial institutions with high credit ratings assigned by international credit-rating agencies.

Lifetime ECLs are the ECLs that result from all possible default events over the expected life of a financial instrument.

12-month ECLs are the portion of ECL that results from default events on a financial instrument that are possible within the 12 months after the reporting date (or a shorter period if the expected life of the instrument is less than 12 months).

In all cases, the maximum period considered when estimating ECLs is the maximum contractual period over which the Group is exposed to credit risk.

ECLs are a probability-weighted estimate of credit losses. Credit losses are measured as the present value of all cash shortfalls (i.e. the difference between the cash flows due to the entity in accordance with the contract and the cash flows that the Group expects to receive).

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Significant increases in credit risk

In assessing whether the credit risk of a financial instrument has increased significantly since initial recognition, the Group compares the risk of default occurring on the financial instrument assessed at the reporting date with that assessed at the date of initial recognition. In making this reassessment, the Group considers that a default event occurs when the debtor is unlikely to pay its credit obligations to the Group in full, without recourse by the Group to actions such as realising security (if any is held). The Group considers both quantitative and qualitative information that is reasonable and supportable including historical experience and forward-looking information that is available without undue cost or effort.

In particular, the following information is taken into account when assessing whether credit risk has increased significantly since initial recognition:

– failure to make payments of principal or interest on their contractually due dates;

– an actual or expected significant deterioration in a financial instrument’s external or internal credit rating (if available);

– an actual or expected significant deterioration in the operating results of the debtor; and

– existing or forecast changes in the technological, market, economic or legal environment that have a significant adverse effect on the debtor’s ability to meet its obligation to the Group.

Irrespective of the outcome of the above assessment, the Group presumes that the credit risk has increased significantly since initial recognition when contractual payments are more than 30 days past due, unless the Group has reasonable and supportable information that demonstrates otherwise.

Depending on the nature of the financial instruments, the assessment of a significant increase in credit risk is performed on either an individual basis or a collective basis.

ECLs are re-measured at each reporting date to reflect changes in the financial instrument’s credit risk since initial recognition. Any change in the ECL amount is recognised as an impairment gain or loss in the profit or loss. The Group recognises an impairment gain or loss for all financial instruments with a corresponding adjustment to their carrying amount through a loss allowance account.

Credit-impaired financial assets

At each reporting date, the Group assesses on a forward -looking basis whether financial assets carried at amortised cost are credit-impaired. A financial asset is ‘credit-impaired’ when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred.

For internal credit risk management, the Group considers an event of default occurs when (i) information developed internally or obtained from external sources indicates that the debtor is unlikely to pay its creditors, including the Group, in full (without taking into account any collateral held by the Group); or (ii) the financial asset is 90 days past due.

Evidence that a financial asset is credit-impaired includes the following observable events:

– Significant financial difficulty of the debtor;

– A breach of contract, such as a default or delinquency in interest or principal payments;

– It becoming probable that the debtor will enter bankruptcy or other financial reorganisation;

– Significant changes in the technological, market, economic or legal environment that have an adverse effect on the debtor; and

– The disappearance of an active market for that financial asset because of financial difficulties.

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Write-off policy

The gross carrying amount of a financial asset is written off (either partially or in full) to the extent that there is no realistic prospect of recovery. This is generally the case when the Group determines that the debtor does not have assets or sources of income that could generate sufficient cash flows to repay the amounts subject to the write-off. Subsequent recoveries of an assets that was previously written off are recognised in profit or loss of the period in which the reversal occurs.

2.9 Inventories

Inventories are carried at the lower of cost and net realisable value. Cost is determined using the first-in, first-out (FIFO) method. Net realisable value is the estimated selling price in the ordinary course of business less the estimated cost of completion and applicable selling expenses.

2.10 Cash and cash equivalents

Cash and cash equivalents include cash at banks and in hand.

2.11 Financial liabilities

The Group’s financial liabilities include trade and other payables.

Financial liabilities are recognised when the Group becomes a party to the contractual provisions of the instrument. All interest related charges are recognised as expenses in the period in which they are incurred.

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires.

Where an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amount is recognised in profit or loss.

Trade and other payables

These are recognised initially at their fair value and subsequently measured at amortised cost using the effective interest method.

2.12 Contract assets and contract liabilities

A contract asset is recognised when the Group recognises revenue (see Note 2.16) before being unconditionally entitled to the consideration under the payment terms set out in the contract. Contract assets are assessed for ECL in accordance with the policy set out in Note 2.8 and are reclassified to receivables when the right to the consideration has become unconditional (see Note 2.7).

A contract liability is recognised when the customer pays consideration before the Group recognises the related revenue (see note 2.16). A contract liability would also be recognised if the Group has an unconditional right to receive consideration before the Group recognises the related revenue. In such cases, a corresponding receivable would also be recognised (see note 2.7).

For a single contract with the customer, either a net contract asset or a net contract liability is presented. For multiple contracts, contract assets and contract liabilities of unrelated contracts are not presented on a net basis.

2.13 Leases

At inception of a contract, the Group considers whether a contract is, or contains a lease. A lease is defined as ‘a contract, or part of a contract, that conveys the right to use an identified asset (the underlying asset) for a period of time in exchange for consideration. To apply this definition, the Group assesses whether the contract meets three key evaluations which are whether:

• the contract contains an identified asset, which is either explicitly identified in the contract or implicitly specified by being identified at the time the asset is made available to the Group;

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• the Group has the right to obtain substantially all of the economic benefits from use of the identified asset throughout the period of use, considering its rights within the defined scope of the contract; and

• the Group has the right to direct the use of the identified asset throughout the period of use. The Group assess whether it has the right to direct ‘how and for what purpose’ the asset is used throughout the period of use.

Measurement and recognition of leases as a lessee

At lease commencement date, the Group recognised a right-of-use asset and a lease liability on the combined statement of financial position. The right-of-use asset is measured at cost, which is made up of the initial measurement of the lease liability, any initial direct costs incurred by the Group, an estimate of any costs to dismantle and remove the underlying asset at the end of the lease, and any lease payments made in advance of the lease commencement date (net of any lease incentives received).

The Group depreciates the right-of-use assets on a straight-line basis from the lease commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term unless the Group is reasonably certain to obtain ownership at the end of the lease term. The Group also assesses the right-of-use asset (except for those meeting the definition of investment properties) for impairment when such indicator exists.

At the commencement date, the Group measures the lease liability at the present value of the lease payments unpaid at that date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Group’s incremental borrowing rate.

Lease payments included in the measurement of the lease liability are made up of fixed payments (including in-substance fixed payments) less any lease incentives receivable, variable payments based on an index or rate, and amounts expected to be payable under a residual value guarantee. The lease payments also include the exercise price of a purchase option reasonably certain to be exercised by the Group and payment of penalties for terminating a lease, if the lease term reflects the Group exercising the option to terminate.

Subsequent to initial measurement, the liability will be reduced for lease payments made and increased for interest cost on the lease liability. It is remeasured to reflect any reassessment or lease modification, or if there are changes in in-substance fixed payments. The variable lease payments that do not depend on an index or a rate are recognised as expense in the period on which the event or condition that triggers the payment occurs.

When the lease is remeasured, the corresponding adjustment is reflected in the right-of- use asset, or profit and loss if the right-of-use asset is already reduced to zero.

The Group has elected to account for short-term leases using the practical expedients. Instead of recognised a right-of-use asset and lease liability, the payments in relation to these leases are recognised as an expense in profit or loss on a straight-line basis over the lease term. Short-term leases are leases with a lease term of 12 month or less.

Refundable rental deposits paid are accounted for under HKFRS 9 and initially measured at fair value. Adjustments to fair value at initial recognition are considered as additional lease payments and included in the cost of right-of-use assets.

2.14 Provisions and contingent liabilities

Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, and it is probable that an outflow of economic benefits will be required to settle the obligation and a reliable estimate of the amount of the obligation can be made. Where the time value of money is material, provisions are stated at the present value of the expenditure expected to settle the obligation.

All provisions are reviewed at each reporting date and adjusted to reflect the current best estimate.

Where it is not probable that an outflow of economic benefits will be required, or the amount cannot be estimated reliably, the obligation is disclosed as a contingent liability, unless the probability of outflow of economic benefits is remote. Possible obligations, whose existence will only be confirmed by the occurrence or

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non-occurrence of one or more future uncertain events not wholly within the control of the Group, are also disclosed as contingent liabilities unless the probability of outflow of economic benefits is remote.

Contingent liabilities assumed in a business combination which are present obligations at the date of acquisition are initially recognised at fair value, provided the fair value can be reliably measured. After the initial recognition at fair value, such contingent liabilities are recognised at the higher of the amount initially recognised, less accumulated recognised where appropriate, and the amount that would be recognised in a comparable provision as described above. Contingent liabilities assumed in a business combination that cannot be reliably fair valued or were not present obligations at the date of acquisition are disclosed as per above.

2.15 Share capital

Ordinary shares are classified as equity. Share capital is determined using the nominal value of shares that have been issued. Any transaction costs associated with the issuing of shares are deduction from share premium (net of any related income tax benefit) to the extent they are incremental costs directly attributable to the equity transaction.

2.16 Revenue recognition

The Group provides property management services and commercial operational services. Revenue from providing services is recognised in the accounting period in which the services are rendered.

Property management services

For property management services, the Group bills a fixed amount for services provided on a monthly basis and recognises as revenue in the amount to which the Group has a right to invoice and that corresponds directly with the value of performance completed.

General property management services

For general property management services income from properties managed under lump-sum basis, where the Group acts as a principal and is primary responsible for providing the property management services to the property owners, the Group recognises the fee received or receivable from property owners as its revenue and all related property management costs as its cost of services.

Value added services to non-property owners

Value added services to non-property owners include mainly i) on-site sales assistance services, which primarily included cleaning and security services to non-property owners, which are billed and settled based on actual level of services provided at pre-determined price and revenue is recognised when such services are provided and ii) property delivery related and other consulting services with non-property owners which are billed on monthly basis and revenue is recognised overtime when the services are provided.

Community value-added services

For community value-added services, revenue is recognised when the related community value-added services provided to property owners, property owners’ associations and residents are rendered. Community related services are normally billable immediately upon the services are rendered and revenue is recognised overtime when the services are provided.

Commercial operational services

For commercial operational services, the Group bills a fixed amount for services provided on a monthly basis and recognises as revenue in the amount to which the Group has a right to invoice and that corresponds directly with the value of performance completed.

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.

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When either party to a contract has performed, the Group presents the contract in the combined statements of financial position 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 contract, if recoverable, are capitalised and presented as assets and subsequently amortised when the related revenue is recognised.

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 recognises 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.

A receivable is recorded when the Group has an unconditional right to consideration. A right to consideration is unconditional if only the passage of time is required before payment of that consideration is due.

2.17 Interest income

Interest income is recognised on an accrual basis using the effective interest method.

2.18 Government grants

Grants from the government are recognised 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 are deferred and recognised in profit or loss over the period necessary to match them with the costs that the grants are intended to compensate. Government grants relating to the purchase of assets are included in other payables as deferred government grants in the combined statements of financial position and are recognised in profit or loss on a straight line basis over the expected lives of the related assets/deducted from the carrying amount of the asset and consequently are effectively recognised in profit or loss over the useful life of the asset by way of reduced depreciation expense.

Government grants relating to income is presented in gross under “Other (losses)/gains, net” in the combined statements of profit or loss and other comprehensive income.

2.19 Impairment of non-financial assets

Property, plant and equipment, intangible assets, right-of-use assets and the Company’s interests in subsidiaries and a joint venture are subject to impairment testing. They are tested for impairment whenever there are indications that the asset’s carrying amount may not be recoverable.

An impairment loss is recognised as an expense immediately for the amount by which the asset’s carrying amount exceeds its recoverable amount. Recoverable amount is the higher of fair value, reflecting market conditions less costs of disposal, and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessment of time value of money and the risk specific to the asset.

For the purposes of assessing impairment, where an asset does not generate cash inflows largely independent from those from other assets, the recoverable amount is determined for the smallest group of assets that generate cash inflows independently (i.e. a cash- generating unit). As a result, some assets are tested individually for impairment and some are tested at cash-generating unit level.

Impairment losses are charged pro rata to the assets in the cash generating unit, except that the carrying value of an asset will not be reduced below its individual fair value less costs of disposal, or value in use, if determinable.

An impairment loss is reversed and recognised as income immediately if there has been a favourable change in the estimates used to determine the asset’s recoverable amount and only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.

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2.20 Employee benefits

Retirement benefit

In accordance with the rules and regulations in the PRC, the PRC based employees of the Group participate in various defined contributions retirement benefit plans organised by the relevant municipal and provincial governments in the PRC under which the Group and the PRC based employees are required to make monthly contributions to these plans calculated as a percentage of the employees’ salaries, subject to a certain ceiling.

The municipal and provincial governments undertake to assure the retirement benefit obligations of all existing and future retired PRC based employees 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 independent administrated funds managed by the PRC government. The Group’s contributions to the defined contribution retirement scheme are expensed as incurred.

Housing funds, medical insurances and other social insurances

Employees of the Group in the PRC are entitled to participate in various government- supervised housing funds, medical insurances and other 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 of the Track Record Period.

Contributions to the housing funds, medical insurances and other social insurances are expensed as incurred.

Short-term employee benefits

Employee entitlements to annual leave are recognised when they accrue to employees. A provision is made for the estimated liability for annual leave as a result of services rendered by employees up to each reporting date. Non-accumulative compensated absences such as sick leave and maternity leave are not recognised until the time of leave.

2.21 Accounting for income tax

Income tax comprises current tax and deferred tax.

Current income tax assets and/or liabilities comprise those obligations to, or claims from, fiscal authorities relating to the current or prior reporting period, that are unpaid at the reporting date. They are calculated according to the tax rates and tax laws applicable to the fiscal periods to which they relate, based on the taxable profit for the year. All changes to current tax assets or liabilities are recognised as a component of tax expense in profit or loss.

Deferred tax is calculated using the liability method on temporary differences at the reporting date between the carrying amounts of assets and liabilities in the financial statements and their respective tax bases. Deferred tax liabilities are generally recognised for all taxable temporary differences. Deferred tax assets are recognised for all deductible temporary differences, tax losses available to be carried forward as well as other unused tax credits, to the extent that it is probable that taxable profit, including existing taxable temporary differences, will be available against which the deductible temporary differences, unused tax losses and unused tax credits can be utilised.

Deferred tax assets and liabilities are not recognised if the temporary difference arises from initial recognition of assets and liabilities in a transaction that affects neither taxable nor accounting profit or loss.

Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries, except where the Group is able to control the reversal of the temporary differences and it is probable that the temporary differences will not reverse in the foreseeable future.

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Deferred tax is calculated, without discounting, at tax rates that are expected to apply in the period the liability is settled or the asset realised, provided they are enacted or substantively enacted at the reporting date.

Changes in deferred tax assets or liabilities are recognised in profit or loss, or in other comprehensive income or directly in equity if they relate to items that are charged or credited to other comprehensive income or directly in equity.

Current tax assets and current tax liabilities are presented in net if, and only if,

(a) the Group has the legally enforceable right to set off the recognised amounts; and

(b) intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

The Group presents deferred tax assets and deferred tax liabilities in net if, and only if,

(a) the entity has a legally enforceable right to set off current tax assets against current tax liabilities; and

(b) the deferred tax assets and the deferred tax liabilities relate to income taxes levied by the same taxation authority on either:

(i) the same taxable entity; or

(ii) different taxable entities which intend either to settle current tax liabilities and assets on a net basis, or to realise the assets and settle the liabilities simultaneously, in each future period in which significant amounts of deferred tax liabilities or assets are expected to be settled or recovered.

2.22 Segment reporting

The Group identifies operating segments and prepares segment information based on the regular internal financial information reported to the chief operating decision-maker (“CODM”) for their decisions about resources allocation to the Group’s business components and for their review of the performance of those components. The business components in the internal financial information reported to the CODM are determined following the Group’s major product and service lines.

2.23 Dividend distribution

Dividend distribution to the Company’s shareholders is recognised as a liability in the Company’s Historical Financial Information in the period which the dividends are approved by the Company’s shareholders or board of directors, where appropriate.

2.24 Offsetting financial instruments

Financial assets and liabilities are offset and the net amount reported in the combined statements of financial position when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously.

2.25 Related parties

For the purpose of the Historical Financial Information, a party is considered to be related to the Group if:

(a) the party is a person or a close member of that person’s family and if that person:

(i) has control or joint control of the Group;

(ii) has significant influence over the Group; or

(iii) is a member of the key management personnel of the Group or of a parent of the Group.

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(b) the party is an entity and if any of the following conditions applies:

(i) the entity and the Group are members of the same group.

(ii) one entity is an associate or joint venture of the other entity (or an associate or joint venture of a member of a group of which the other entity is a member).

(iii) the entity and the Group are joint ventures of the same third party.

(iv) one entity is a joint venture of a third entity and the other entity is an associate of the third entity.

(v) the entity is a post-employment benefit plan for the benefit of employees of either the Group or an entity related to the Group.

(vi) the entity is controlled or jointly controlled by a person identified in (a).

(vii) a person identified in (a)(i) has significant influence over the entity or is a member of the key management personnel of the entity (or of a parent of the entity).

(viii) the entity, or any member of a group of which it is a part, provides key management personnel services to the Group or to the parent of the Group.

Close members of the family of a person are those family members who may be expected to influence, or be influenced by, that person in their dealings with the entity.

3. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below:

Provision for impairment of trade and other receivables

The Group makes allowances on trade and other receivables based on assumptions about risk of default and expected loss rates. The Group used judgement 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 Track Record Period.

As at 31 December 2018, 2019 and 2020, the carrying amounts of trade and other receivables (excluding prepayment) are RMB314,953,000, RMB410,971,000 and RMB470,087,000, respectively. Details of the provision for impairment of trade and other receivables are set out in Note 18.

Current and deferred income taxes

As detailed in Note 9, the Group is subject to Enterprise Income Tax in the PRC. Judgement 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 tax provisions in the period in which such determination is made.

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4. REVENUE AND SEGMENT INFORMATION

Management has determined 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 years ended 31 December 2018, 2019 and 2020, the Group is principally engaged in the provision of general property management services, value-added services to non-property owners, community value-added services, commercial operational services to property developers and property owners and commercial operational services to tenants in the PRC. During the years ended 31 December 2018, 2019 and 2020, all the segments are domiciled in the PRC and all the revenue are derived in the PRC, and the segments are principally engaged in the provision of similar services to similar customers. All operating segments of the Group were aggregated into a single operating segment.

Revenue mainly comprises of proceeds from provision of property management services and commercial operational services. An analysis of the Group’s revenue is as follows:

Year ended 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Revenue from customers and recognised over time Property management services – General property management services 125,361 141,485 148,442 – Value-added services to non-property owners 22,967 26,521 28,313 – Community value-added services 16,464 18,779 26,524

164,792 186,785 203,279

Commercial operational services – Commercial operational services to property developers and property owners 282 – 6,236 – Commercial operational services to tenants 33,831 37,430 31,836

34,113 37,430 38,072

198,905 224,215 241,351

Geographical information

The major operating entities of the Group are domiciled in the PRC. As at 31 December 2018, 2019 and 2020, substantially all of the non-current assets (other than deferred tax assets) of the Group were located in the PRC.

Information about major customers

For the years ended 31 December 2018, 2019 and 2020, revenue from companies controlled by the Controlling Shareholder contributed 14.7%, 15.6% and 21.6% of the Group’s revenue, respectively. Other than companies controlled by the Controlling Shareholder, the Group had a large number of customers and none of whom contributed 10% or more of the Group’s revenue for the Track Record Period.

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a) Contract liabilities

The Group recognises the following revenue-related contract liabilities: As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Property management services – General property management services 30,885 39,465 44,925 – Value-added services to non-property owners 31 699 365 – Community value-added services 1,514 2,127 2,388

32,430 42,291 47,678

Commercial operational services – Commercial operational services to tenants 4,742 4,982 4,833

Contract liabilities 37,172 47,273 52,511

Contract liabilities of the Group mainly arise from the advance payments made by customers while the underlying services are yet to be provided. Significant increase in contract liabilities as at 31 December 2020 was primarily due to increase of property management projects in the Group’s project portfolio.

b) Revenue recognised in relation to contract liabilities

The following table shows the revenue recognised during the Track Record Period related to carried-forward contract liabilities. Year ended 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Revenue recognised that was included in contract liabilities at the beginning of the year/period Property management services – General property management services 22,907 26,935 26,436 – Value-added services to non-property owners – 32 699 – Community value-added services 882 1,513 1,425

23,789 28,480 28,560

Commercial operational services – Commercial operational services to tenants 3,729 4,628 4,703

27,518 33,108 33,263

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c) Unsatisfied performance obligations

For property management and commercial operational services, the Group recognises revenue in the amount that equals to the right to invoice which correspond directly with the value to the customer of the Group’s performance to date, on a monthly basis. The Group has elected the practical expedient for not to disclose the remaining performance obligation for these types of contracts. The term of the contracts for value-added services to non-property owners is generally set to expire when the counterparties notify the Group that the services are no longer required.

For community-related value added services, they are rendered in short period of time and there is no unsatisfied performance obligation at the end of the reporting period.

d) Assets recognised from incremental costs to obtain a contract

The Group has no significant incremental costs to obtain or fulfil a contract.

5. OTHER (LOSSES)/GAINS, NET

Year ended 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

(Loss)/gain on fair value changes of financial assets at fair value through profit or loss (1,563) 4,411 – Gain on sales of financial assets at fair value through profit or loss – – 14,887 Dividend income 279 299 416 Government grants (Note) 197 537 1,495 Loss on disposal of property, plant and equipment (21) (57) (13) Others 102 390 (95) (1,006) 5,580 16,690

Note:

During the year ended 31 December 2020, the Group received funding support amounting to RMB919,000 from the government. The purpose of the funding is to provide financial support to enterprises to retain their employees who would otherwise be made redundant. Under the terms of the grant, the Group is required not to make redundancies during the subsidy period and to spend all the funding on paying wages to the employees.

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6. PROFIT BEFORE INCOME TAX

Profit before income tax has been arrived at after charging/(crediting):

Year ended 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Auditor’s remuneration – 23 24 Amortisation of intangible assets 93 213 326 Depreciation of property, plant and equipment 1,109 1,126 987 Depreciation of right-of-use asset 633 339 135 Loss on disposal of property, plant and equipment 21 57 13 Provision for/(reversal of) impairment loss on trade and other receivables 3,279 (3,218) 808 [REDACTED] expenses – – [REDACTED] Short term lease 71 54 15 Employment benefit expenses 109,863 124,168 124,379

7. EMPLOYEE BENEFIT EXPENSES (INCLUDING DIRECTORS’ EMOLUMENTS)

Year ended 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Salaries, bonus and allowances 88,657 100,830 106,777 Retirement benefit scheme contributions (Note) 11,310 11,995 6,309 Other employee benefits 9,896 11,343 11,293

109,863 124,168 124,379

Note:

Due to the impact of COVID-19, a number of policies including the relief of social insurance have been promulgated by the government since February 2020 to expedite resumption of economic activities, which resulted in the relief of certain contributions to defined contribution scheme during the year ended 31 December 2020.

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8. FINANCE INCOME, NET Year ended 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Finance income 221 302 133 Finance costs (45) (8) (25)

Finance income, net 176 294 108

9. INCOME TAX EXPENSE Year ended 31 December Note 2018 2019 2020 RMB’000 RMB’000 RMB’000

Current tax — PRC Enterprise Income Tax Current year 4,056 5,307 11,830 Under provision of prior years 80 – –

4,136 5,307 11,830 Deferred tax 23 254 1,765 (815)

Income tax expense 4,390 7,072 11,015

The difference between the actual income tax charge in the combined statements of profit or loss and comprehensive income and the amounts which would result from applying the enacted tax rate to profit before income tax can be reconciled as follows: Year ended 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Profit before income tax 22,883 42,659 65,193

Tax on profit before income tax, calculated at applicable tax rate in tax jurisdictions concerned 3,432 6,399 9,779 Tax effect on preferential tax rate applied in certain subsidiaries 521 577 1,182 Tax effect on share of results of a joint venture, net of tax (3) (21) (5) Tax effect on non-deductible expenses 731 354 456 Tax effect of tax losses/deductible temporary differences not recognised 45 246 29 Utilisation of tax losses previously not recognised (704) – (15) Under provision of prior years 80 – – Effect of change in tax rates on deferred tax balances 338 (146) 7 Others (50) (337) (418)

Income tax expense 4,390 7,072 11,015

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Notes:

(a) Cayman Islands income tax

The Company is incorporated in the Cayman Islands as an exempted company with limited liability under the Companies Law of the Cayman Islands and accordingly, is exempted from Cayman Islands income tax.

(b) Hong Kong profits tax

No Hong Kong profits tax has been provided as the Group did not derive any assessable profit arising in Hong Kong during the Track Record Period.

The income tax provision of certain PRC entities of the Group has been calculated at the statutory tax rate of 25% on the estimated assessable profits for the Track Record Period, based on the existing legislation, interpretations and practices in respect thereof.

The Ministry of Finance and the State Administration of Taxation announced “Implementing the Inclusive Tax Deduction and Exemption Policies for Micro and Small Enterprises”. The annual taxable income of a small low-profit enterprise that is not more than RMB1,000,000 shall be included in its taxable income, with the applicable enterprise income tax rate of 5%; and the annual taxable income that is not less than RMB1,000,000 nor more than RMB3,000,000 shall be included in its taxable income, with the applicable enterprise income tax rate of 10%.

Concession rate of 15% is granted by the local tax authorities in western region expiring in 2030. According to the Notice of the Enterprise Income Tax for Implementation of Exploration and Development of Western Region (Notice of the State Administration of Taxation No. 12 2012) and the Catalogue of Industries Encouraged to Develop in the Western Region (Order of the National Development and Reform Commission No. 15), companies located in the western region of the PRC and engaged in the business encouraged by the PRC government are entitled to the preferential EIT rate of 15% till 31 December 2020 if the operating revenue of the encouraged business in a year accounted for more than 70% of the total income in that year. During the Track Record Period, certain subsidiaries in the Group, which are located in the western region, are engaged in the encouraged businesses included in the related notice and catalogue and the total revenue of their major business for the Track Record Period accounted for more than 70% of their total revenue in these years. Therefore these entities enjoy the preferential EIT rate of 15%.

In addition, according to the Notice of the Continuation of the Enterprise Income Tax for Implementation of Exploration and Development of Western Region (Notice of the Ministry of Finance, State Administration of Taxation and National Development and Reform Commission No. 23 2020) issued on 23 April 2020, companies located in the western region of the PRC and engaged in the business encouraged by the PRC government are entitled to the preferential EIT rate of 15% from 1 January 2021 to 31 December 2030 if the operating revenue of the encouraged business in a year accounted for more than 60% of the total income in that year.

The preferential income tax rate applicable to Chongqing Ronghui Guanling Commercial Real Estate Operation Management Co., Ltd. was 15% for the years ended 31 December 2018, 2019 and 2020.

The preferential income tax rate applicable to Chongqing Ronghui Commercial Management Co., Ltd. was set under “Implementing the Inclusive Tax Deduction and Exemption Policies for Micro and Small Enterprises” for the years ended 31 December 2019 and 2020.

The preferential income tax rate applicable to Chongqing Ronghui Property Management Co., Ltd. was 15% for the years ended 31 December 2018, 2019 and 2020.

The preferential income tax rate applicable to Shapingba Branch of Chongqing Ronghui Property Management Co., Ltd. was 15% for the years ended 31 December 2018, 2019 and 2020.

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The preferential income tax rate applicable to Zigong Branch of Chongqing Ronghui Property Management Co., Ltd. was 15% for the year ended 31 December 2020.

The preferential income tax rate applicable to Jinan Branch of Chongqing Ronghui Property Management Co., Ltd. was set under “Implementing the Inclusive Tax Deduction and Exemption Policies for Micro and Small Enterprises” for the year ended 31 December 2020.

The preferential income tax rate applicable to Fuzhou Ronghui Real Estate Co., Ltd. was set under “Implementing the Inclusive Tax Deduction and Exemption Policies for Micro and Small Enterprises” for the years ended 31 December 2019 and 2020.

The preferential income tax rate applicable to Fujian Ronghui Property Management Co., Ltd. was set under “Implementing the Inclusive Tax Deduction and Exemption Policies for Micro and Small Enterprises” for the year ended 31 December 2020.

10. DIVIDENDS

No dividends have been paid or declared by the Company since its date of incorporation.

11. EARNINGS PER SHARE

Earnings per share is not presented as its inclusion, for the purpose of the Historical Financial Information, is not considered meaningful due to the Reorganisation and the basis of presentation of the results of the Group for the Track Record Period as disclosed in Note 1.2 above.

12. DIRECTORS’ AND CHIEF EXECUTIVE’S REMUNERATION AND EMPLOYEES’ EMOLUMENTS

(a) Directors’ remuneration

The Company was incorporated on 1 February 2021. Ms. Wong Tan Ching and Mr. Wong Wai Lam were appointed as executive directors on 4 February 2021. Mr. Tang Shijie was appointed as a non-executive director on 1 March 2021 and Mr. Chen Zhong, Mr. Feng Shijun and Mr. Pei Luyang were appointed as non- executive directors on 28 May 2021. During the Track Record Period, executive directors, non-executive directors and chief executive officer of the Company received remuneration from the subsidiaries now comprising the Group for services in connection with themanagement of affairs of the

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Group prior to becoming the directors and chief executive officer of the Company. The details were disclosed as below:

Retirement Basic salaries benefit and scheme Name of directors Fees allowances contributions Total RMB’000 RMB’000 RMB’000 RMB’000

Year ended 31 December 2018 Executive directors: Ms.WongTanChing –––– Mr. Wong Wai Lam (Note i) ––––

Non-executive directors: Mr.ChenZhong –––– Mr.FengShijun –––– Mr. Tang Shijie –––– Mr. Pei Luyang – 344 19 363

– 344 19 363

Year ended 31 December 2019 Executive directors: Ms.WongTanChing –––– Mr. Wong Wai Lam (Note i) ––––

Non-executive directors: Mr.ChenZhong –––– Mr.FengShijun –––– Mr. Tang Shijie –––– Mr. Pei Luyang – 369 19 388

– 369 19 388

Year ended 31 December 2020 Executive directors: Ms.WongTanChing –––– Mr. Wong Wai Lam (Note i) ––––

Non-executive directors: Mr.ChenZhong –––– Mr.FengShijun –––– Mr. Tang Shijie –––– Mr. Pei Luyang – 449 13 462

– 449 13 462

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Note:

(i) Mr. Wong Wai Lam is also the chief executive officer of the Group.

The emoluments shown above represent emoluments received by these directors in the capacity as directors/employees of the companies comprising the Group during the Track Record Period.

There were no arrangements under which a director of the Company waived or agreed to waive any remuneration during the Track Record Period.

(b) Five highest paid individuals

For the years ended 31 December 2018, 2019 and 2020, included 1 director whose emoluments are reflected in the analysis presented above. The emoluments payable to the remaining 4 highest paid individuals for the years ended 31 December 2018, 2019 and 2020 are as follows:

Year ended 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Basic salaries and allowances 1,562 2,483 3,232 Retirement benefit scheme contributions and other benefits 535 225 141

2,097 2,708 3,373

The aggregate of the emoluments in respect of the remaining 4 individuals for the years ended 31 December 2018, 2019 and 2020 fell within the following bands:

Year ended 31 December 2018 2019 2020

Emolument bands Nil – RMB1,000,000 4 4 2 RMB1,000,001 or above – – 2

During the Track Record Period, no emoluments were paid by the Group to any of the directors or the five highest paid individuals as an inducement to join or upon joining the Group or as compensation for loss of office.

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13. PROPERTY, PLANT AND EQUIPMENT

Furniture and fixtures and office Motor Leasehold Construction- Machineries equipment vehicles improvement in-progress Total RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000

At 1 January 2018 Cost 1,783 2,496 379 1,142 – 5,800 Accumulated depreciation (1,092) (1,645) (160) – – (2,897)

Net book amount 691 851 219 1,142 – 2,903

Year ended 31 December 2018 Opening net book amount 691 851 219 1,142 – 2,903 Additions 380 333 18 – – 731 Disposal – (13) (8) – – (21) Depreciation (246) (300) (69) (494) – (1,109)

Closing net book amount 825 871 160 648 – 2,504

At 31 December 2018 and 1 January 2019 Cost 2,149 2,795 380 1,142 – 6,466 Accumulated depreciation (1,324) (1,924) (220) (494) – (3,962)

Net book amount 825 871 160 648 – 2,504

Year ended 31 December 2019 Opening net book amount 825 871 160 648 – 2,504 Additions 544 321 28 – – 893 Disposal (4) (15) (38) – – (57) Depreciation (303) (323) (58) (442) – (1,126)

Closing net book amount 1,062 854 92 206 – 2,214

At 31 December 2019 and 1 January 2020 Cost 2,639 2,853 320 1,142 – 6,954 Accumulated depreciation (1,577) (1,999) (228) (936) – (4,740)

Net book amount 1,062 854 92 206 – 2,214

Year ended 31 December 2020 Opening net book amount 1,062 854 92 206 – 2,214 Additions 423 504 17 – 621 1,565 Disposal (7) (8) (1) – – (16) Depreciation (370) (372) (39) (206) – (987)

Closing net book amount 1,108 978 69 – 621 2,776

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Furniture and fixtures and office Motor Leasehold Construction- Machineries equipment vehicles improvement in-progress Total RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000

At 31 December 2020 Cost 2,966 3,244 330 1,142 621 8,303 Accumulated depreciation (1,858) (2,266) (261) (1,142) – (5,527)

Net book amount 1,108 978 69 – 621 2,776

Depreciation charges recognised is analysed as follows:

Year ended 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Cost of sales 871 895 684 Administrative expenses 238 231 303

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14. INTANGIBLE ASSETS

Computer software RMB’000

At 1 January 2018 Cost 272 Accumulated amortisation (195)

Net book amount 77

Year ended 31 December 2018 Opening net book amount 77 Additions 547 Amortisation (93)

Closing net book amount 531

At 31 December 2018 and 1 January 2019 Cost 819 Accumulated amortisation (288)

Net book amount 531

Year ended 31 December 2019 Opening net book amount 531 Additions 503 Amortisation (213)

Closing net book amount 821

At 31 December 2019 and 1 January 2020 Cost 1,322 Accumulated amortisation (501)

Net book amount 821

Year ended 31 December 2020 Opening net book amount 821 Additions 510 Amortisation (326)

Closing net book amount 1,005

At 31 December 2020 Cost 1,832 Accumulated amortisation (827)

Net book amount 1,005

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Amortisation charges recognised is analysed as follows:

Year ended 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Cost of sales 47 89 101 Administrative expenses 46 124 225

15. INTEREST IN A JOINT VENTURE

As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Cost of investment in a joint venture 1,000 1,000 1,000 Share of post-acquisition profits and other comprehensive income, net of dividends received 14 100 199

Closing net book amount 1,014 1,100 1,199

As at 31 December 2018, 2019 and 2020, details of the Group’s interest in joint venture which is an unlisted corporate entity whose quoted market price is not available, are as follows:

Country / place of Particulars of Form of business incorporation and issued and paid up Name of joint venture structure business capital % of interest held Principal activity

Fuzhou Funeng Incorporated PRC RMB2,000,000 50% (31 December, Property Ronghui Property 2018, 2019 and management Management Co., Ltd. 2020) services (“Fuzhou Funeng Ronghui”) 福州福能融匯物業管理有限公司

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Set out below are the summarised financial information of the sole joint venture which is accounted for using the equity method – Fuzhou Funeng Ronghui:

As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Current assets 2,413 3,539 4,393 Non-current assets 24 23 12 Current liabilities (409) (1,362) (2,007)

Net assets 2,028 2,200 2,398

Included in the above assets and liabilities: Cash and cash equivalents 2,397 3,494 4,372 Current financial liabilities (excluding trade and other payables and provisions) – – – Non-current financial liabilities (excluding trade and other payables and provisions) – – –

Year ended 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Revenue 1,119 9,462 10,029 Cost of sales (464) (8,560) (8,640) Administrative expense (628) (734) (1,198) Interest income 4 15 17 Income tax expenses (3) (11) (10)

Profit and total comprehensive income for the year 28 172 198

As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Total net assets of the joint venture 2,028 2,200 2,398 Proportion of ownership interests held by the Group 1,014 1,100 1,199 Carrying amount of the investment in a joint venture in the combined financial statements 1,014 1,100 1,199

The Group has not incurred any contingent liabilities or other commitments relating to its investment in a joint venture during the Track Record Period.

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16. RIGHT-OF-USE ASSETS

RMB’000

At 1 January 2018 Cost 1,538 Accumulated depreciation (583)

Net book amount 955

Year ended 31 December 2018 Opening net book amount 955 Depreciation (633)

Closing net book amount 322

At 31 December 2018 and 1 January 2019 Cost 1,538 Accumulated depreciation (1,216)

Net book amount 322

Year ended 31 December 2019 Opening net book amount 322 Additions 46 Depreciation (339)

Closing net book amount 29

At 31 December 2019 and 1 January 2020 Cost 1,584 Accumulated depreciation (1,555)

Net book amount 29

Year ended 31 December 2020 Opening net book amount 29 Additions 1,290 Depreciation (135)

Closing net book amount 1,184

At 31 December 2020 Cost 2,874 Accumulated depreciation (1,690)

Net book amount 1,184

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Depreciation charges recognised is analysed as follows:

Year ended 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Cost of sales 633 322 – Administrative expenses – 17 135

During the years ended 31 December 2019 and 2020, the total additions to right-of-use assets amounts to RMB46,000 and RMB1,290,000, respectively. The details in relation to these leases are set out in Note 22.

17. INVENTORIES

As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Raw materials to be used in value-added services 864 702 561 Consumable parts – 11 11

Closing net book amount 864 713 572

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18. TRADE AND OTHER RECEIVABLES

Group

As at 31 December Notes 2018 2019 2020 RMB’000 RMB’000 RMB’000

Trade receivables (a) – Third parties 11,310 11,715 13,412 – Related parties 27 32,063 25,130 38,515

43,373 36,845 51,927 Less: Provision for impairment of trade receivables (5,672) (1,915) (2,493)

37,701 34,930 49,434

Other receivables (b) Deposits and prepayment 1,904 2,043 3,193 Amounts due from related parties 27 270,882 370,487 412,453 Other receivables 6,448 7,804 8,549 Contract assets – – 962 Deferred [REDACTED] costs – – [REDACTED] Other tax receivables 258 186 54

279,492 380,520 425,571 Less: Provision for impairment of other receivables (2,848) (3,387) (3,617)

276,644 377,133 421,954 Less: Non-current portion Prepayment – – (16)

Total current trade and other receivables 314,345 412,063 471,372

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The directors of the Company considered that the fair values of trade and other receivables are not materially different from their carrying amounts because these amounts have short maturity periods on their inception.

a) Trade receivables

Trade receivables mainly arise from property management services managed under lump sum basis, value added services to non-property owners, community-related value added services and commercial management services.

Property management services income under lump sum basis are received in accordance with the term of the relevant property service agreements. Service income from property management services is due for payment by property owners upon rendering of services.

The credit period is normally within 30 days and 90 days from the issuance of payment requests for third parties and related parties respectively.

The ageing analysis of trade receivables at the end of each of the Track Record Period, based on invoice date and due date, is as follows:

As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

0 – 30 days 13,791 16,439 17,198 31 – 180 days 4,066 11,074 9,513 181 – 365 days 2,577 2,298 7,784 Over 1 year 22,939 7,034 17,432

43,373 36,845 51,927

The Group applies the simplified approach to provide for ECL prescribed by HKFRS 9, which permits the use of the lifetime ECL provision for all trade receivables. To measure the ECL, trade receivables have been grouped based on shared credit risk characteristics and the ageing.

The Group did not hold any collateral as security or other credit enhancements over the impaired trade receivables, whether determined on an individual or collective basis.

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As at 31 December 2018, 2019 and 2020, the provision for impairment of trade receivables was determined as follow:

Third parties 0–30 31 – 180 181 – 365 Over Related days days days 1 year parties Total RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000

Expected loss rate 1.58% 1.58% 1.58% 7.16%-100% 0.28%-100%

At 31 December 2018 Gross carrying amount 3,260 3,172 1,425 3,453 32,063 43,373 Loss allowance provision (52) (50) (23) (1,273) (4,274) (5,672)

Expected loss rate 1.63% 1.63% 1.63% 7.40%-100% 0.29%-100%

At 31 December 2019 Gross carrying amount 3,324 2,721 1,715 3,955 25,130 36,845 Loss allowance provision (85) (44) (28) (1,600) (158) (1,915)

Expected loss rate 1.71% 1.71% 1.71% 7.77%-100% 0.31%-100%

At 31 December 2020 Gross carrying amount 2,149 3,829 2,303 5,131 38,515 51,927 Loss allowance provision (37) (65) (39) (1,921) (431) (2,493)

The movement in the provision for impairment of trade receivables is as follows:

As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Balance at the beginning of the year 2,518 5,672 1,915 Provision for/(reversal of) impairment 3,154 (3,757) 578

Balance at the end of the year 5,672 1,915 2,493

b) Other receivables

Other receivables

The amounts mainly represent the payments on behalf of property owners in respect of utilities and maintenance costs of the properties and advances for various expenses to be incurred in the ordinary course of business.

Provision for impairment of other receivables

Except for an other receivable of RMB1,324,000 which was provided 100% allowance rate, impairment on other receivables from third parties (excluding prepayments and advance to employees) are assessed individually and measured as either 12-month expected credit loss or lifetime expected credit loss, depending on whether there has been a significant increase in credit risk since initial recognition. Impairment on amounts due from related parties was limited to 12-month expected credit losses, which was 0.5% allowance rate, since the related parties have a strong capacity to meet its contractual cash flow in the near term.

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The movement in the provision for impairment of other receivables is as follows:

As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Balance at the beginning of the year 2,723 2,848 3,387 Provision for impairment 125 539 230

Balance at the end of the year 2,848 3,387 3,617

19. FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS

As at 31 December Notes 2018 2019 2020 RMB’000 RMB’000 RMB’000

Listed securities – listed in the PRC 8,429 12,847 –

The fair value of the Group’s investments in listed securities has been measured as described in Note 29.7.

The fair value of financial assets at fair value through profit or loss are at level 1 of the financial value hierarchy (Note 29.7). Information about the Group’s exposure to price risk is provided in Note 29.6.

20. BANK BALANCES AND CASH

As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Cash at bank 92,408 45,498 74,100 Cash in hand 419 499 633

92,827 45,997 74,733

All bank balances and cash were denominated in RMB as at 31 December 2018, 2019 and 2020.

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21. TRADE AND OTHER PAYABLES

Group

As at 31 December Notes 2018 2019 2020 RMB’000 RMB’000 RMB’000

Trade payables – Third parties 9,555 9,804 9,849 – Related parties 27 2,007 164 262

(a) 11,562 9,968 10,111

Other payables Deposits received 21,174 18,300 18,977 Staff costs and welfare accruals 21,424 25,083 27,687 Accrued charges and other payables 3,771 4,816 5,923 Amounts due to related parties 27 32,775 23,649 24,149 Amounts collected on behalf of property owners 16,082 20,263 21,187 Receipts in advance – other 1,775 2,087 1,477 Other tax liabilities 1,838 1,269 3,178 Provision for litigation (b) – – 934

98,839 95,467 103,512

110,401 105,435 113,623

All amounts are short-term and hence the carrying values of the Group’s trade and other payables as at 31 December 2018, 2019 and 2020 were considered to be a reasonable approximation of their fair values.

(a) Trade payables

The Group was granted by its suppliers credit periods ranging from 30 to 90 days. The ageing analysis of trade payables based on invoice date is as follows:

As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Within 1 year 11,243 9,543 9,697 Over 1 year 319 425 414

11,562 9,968 10,111

(b) Provision for litigation

It represents provision for liabilities related to claim by suppliers and employees against the Group.

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22. LEASE LIABILITIES

As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Total minimum lease payments – Due within one year 339 24 300 – Due in the second to fifth years – – 994

339 24 1,294 Future finance charges on lease liabilities (7) (1) (130)

Present value of leases liabilities 332 23 1,164

Present value of minimum lease payments – Due within one year 332 23 246 – Due in the second to fifth years – – 918

332 23 1,164 Less: Portion due within one year included under current liabilities (332) (23) (246)

Portion due after one year included under non-current liabilities – – 918

As at 31 December 2018, 2019 and 2020, lease liabilities amounting to RMB332,000, RMB23,000 and RMB1,164,000, respectively are effectively secured by the related underlying assets as the rights to the leased asset would be reverted to the lessor in the event of default by repayment by the Group.

During the years end 31 December 2018, 2019 and 2020, the total cash outflows for the leases are RMB733,000, RMB400,000 and RMB189,000, respectively.

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Details of the lease activities

As at 31 December 2018, 2019 and 2020, the Group has entered into leases for offices.

Financial statements items Types of of right-of-use right-of-use assets assets included in Number of leases Range of remaining lease term Particulars 31 December 31 December 2018 2019 2020 2018 2019 2020

Offices Right-of-use assets 2 1 6 6 - 8 15 10-57 No extension option or months months months termination option would be exercised at the lease commencement date

23. DEFERRED TAXATION

The analysis of deferred tax assets are as follows:

As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Deferred tax assets 1,803 750 853 Deferred tax liabilities – 712 –

The net movement of deferred tax assets are as follows:

As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

At the beginning of the year 2,057 1,803 750 Recognised in profit or loss (Note 9) (254) (1,053) 103

At the end of the year 1,803 750 853

The net movement of deferred tax liabilities related to fair value changes are as follows:

As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

At the beginning of the year – – 712 Recognised in profit or loss (Note 9) – 712 (712)

At the end of the year – 712 –

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The movement in deferred tax assets during the Track Record Period, without taking into consideration the offsetting of balances within the same tax jurisdiction, is as follows: Fair value Impairment Estimated Tax losses changes loss liabilities Total RMB’000 RMB’000 RMB’000 RMB’000 RMB’000

At 1 January 2018 1,214 – 843 – 2,057 Recognised in profit or loss (847) 391 202 – (254)

At 31 December 2018 and 1 January 2019 367 391 1,045 – 1,803 Recognised in profit or loss (180) (391) (482) – (1,053)

At 31 December 2019 and 1 January 2020 187 – 563 – 750 Recognised in profit or loss (184) – 134 153 103

At 31 December 2020 3 – 697 153 853

As at 31 December 2018, 2019 and 2020, no deferred tax has been recognised for withholding taxes that would be payable on certain of the unremitted earnings that are subject to withholding taxes of the Group’s subsidiaries established in the PRC. In the opinion of the directors, the Company controls the dividend policy of these subsidiaries and it is not probable that the temporary differences will reverse in the foreseeable future. The aggregate amount of temporary differences associated with investments in subsidiaries in the PRC for which deferred tax liabilities have not been recognised amounting to approximately RMB27,274,000, RMB50,825,000 and RMB134,992,000 respectively, as at 31 December 2018, 2019 and 2020.

The Group did not recognise tax losses amounting to RMB556,000, RMB1,388,000 and RMB1,329,000 for the years ended 31 December 2018, 2019 and 2020, respectively, that can be carried forward against future taxable income. These tax losses have expiry date from 2021 to 2025.

24. SHARE CAPITAL

The Group

Share capital during the Track Record Period represents the combined paid-in capital of the companies now comprising the Group as at 31 December 2018, 2019 and 2020, after elimination of inter-company investments.

The Company

The Company was incorporated in the Cayman Islands on 1 February 2021 with an authorised share capital of HK$380,000, comprising 38,000,000 of ordinary shares of HK$0.01 each. On incorporation, one fully paid ordinary share was allotted and issued at par to the shareholder of the Company.

On 4 February 2021, the one share was transferred at par to Ronghui Global Investment Limited (“WC-Holding”), a BVI company indirectly owned as to 55% by Mr. Wong Cho Shi and 45% by Ms. Chan Sun Ping through Ronghui Group Limited (“WC-BVI”), following which 59 shares were allotted and issued to WC-Holding. On the same date, four Shares and four Shares were allotted and issued to Ronghui Company Limited (“Wong-Holding”) and Ronghui Sun Investment Limited (“Chan-Holding”), respectively. Wong-Holding is indirectly wholly-owned by Mr. Wong Cho Shi through Ronghui International Limited (“Wong-BVI”). Chan-Holding is indirectly wholly-owned by Ms. Chan Sun Ping through Ronghui Sun International Limited (“Chan-BVI”). Upon completion of such allotment and issuance, our Company became owned as to approximately 88.2% by WC-Holding and 5.9% by each of Wong-Holding and Chan-Holding.

25. RESERVES

The Group

The amounts of the Group’s reserves and the movements therein for the years ended 31 December 2018, 2019 and 2020 are presented in the combined statements of changes in equity.

Statutory reserve

In accordance with the relevant laws and regulations for the companies incorporated in the PRC now comprising the Group, it is required to appropriate 10% of its annual statutory net profit determined in accordance with

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China Accounting Standards for Enterprises issued by the Ministry of Finance of PRC, after offsetting any prior years’ losses, to the statutory reserve. When the balance of such a reserve reaches 50% of the registered capital of the respective company, any further appropriation is at the discretion of shareholders. The statutory reserve can be used to offset prior years’ losses, if any, and may be converted into share capital by issuing new shares to shareholders in proportion to their existing shareholding or by increasing the par value of the shares currently held by them, provided that the remaining balance of the reserve after such an issue is not less than 25% of registered capital. The statutory reserve is non-distributable.

Capital reserve

For the purpose of this report, the capital reserve of the Group represents the capital contribution from the shareholders.

26. COMMITMENTS

Capital commitments As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Acquisition of property, plant and equipment – – 642 Acquisition of intangible assets 31 – 119

31 – 761

27. RELATED PARTY TRANSACTIONS

The Group’s accounting policies on related parties are disclosed in Note 2.25. In addition to the transactions/information disclosed elsewhere in these Historical Financial Information, during the Track Record Period, the Group had the following material transactions with related parties:

(a) During the Track Record Period, the related parties that had transactions with the Group were as follows: Related parties Relationship with the Group

Chongqing Bojun Industry Co., Ltd. Controlled by Mr. Wong Cho Shi and Ms. Chan (重慶博竣實業有限公司) Sun Ping Chongqing Ronghua Housing Co., Ltd. Controlled by Mr. Wong Cho Shi and Ms. Chan (重慶融華房地產有限公司) Sun Ping Chongqing Ronghui Industry Co., Ltd. Controlled by Mr. Wong Cho Shi and Ms. Chan (重慶融匯實業有限公司) Sun Ping Chongqing Ronghui Investment Co., Ltd. Controlled by Mr. Wong Cho Shi and Ms. Chan (重慶融匯投資有限公司) Sun Ping Chongqing Ronghui Investment Co., Ltd. Controlled by Mr. Wong Cho Shi and Ms. Chan – Ronghui Lisheng Hotel Sun Ping (重慶融匯投資有限公司融匯麗笙酒店) Chongqing Ronghui Hot Spring Development Controlled by Mr. Wong Cho Shi and Ms. Chan Co., Ltd. Sun Ping (重慶融匯溫泉產業發展有限公司) Chongqing Ronghui Lisheng Hotel Investment Controlled by Mr. Wong Cho Shi and Ms. Chan Co., Ltd. Sun Ping (重慶融匯麗笙酒店投資有限公司) Chongqing Ronghui Western Property Co., Ltd. Controlled by Mr. Wong Cho Shi and Ms. Chan (重慶融匯西區置業有限公司) Sun Ping Chongqing Zezhong Landscape Architecture Controlled by Mr. Wong Cho Shi and Ms. Chan Co., Ltd. Sun Ping (重慶澤眾園林有限公司) Chongqing Zezhong Gardening Co., Ltd. Controlled by Mr. Wong Cho Shi and Ms. Chan (重慶澤眾園林股份有限公司) Sun Ping Fujian Hui Ya Hotel Co., Ltd. Controlled by Mr. Wong Cho Shi and Ms. Chan (福建匯雅酒店有限公司) Sun Ping Fujian Rongjing Hot Spring Development Controlled by Mr. Wong Cho Shi and Ms. Chan Co., Ltd. (福建融景溫泉開發有限公司) Sun Ping

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Related parties Relationship with the Group

Fujian Ronghui Property Co., Ltd. Joint venture controlled by Mr. Wong Cho Shi (福建融匯置業有限公司) and Ms. Chan Sun Ping Fujian Ronghai Property Co., Ltd. Joint venture controlled by Mr. Wong Cho Shi (福建融海置業有限公司) and Ms. Chan Sun Ping Minghou Housing Development Co., Ltd. Controlled by Mr. Wong Cho Shi and Ms. Chan (閩候上街鎮房地產開發有限公司) Sun Ping Ronghui (Fujian) Group Limited Controlled by Mr. Wong Cho Shi and Ms. Chan (融匯（福建）集團有限公司) Sun Ping Shandong Ronghui Creative Culture Property Controlled by Mr. Wong Cho Shi and Ms. Chan Co., Ltd. (山東融匯文創置業有限公司) Sun Ping Shandong Ronghui Development Co., Ltd. Controlled by Mr. Wong Cho Shi and Ms. Chan (山東融匯建設開發有限公司) Sun Ping Shandong Ronghui Housing Property Co., Ltd. Controlled by Mr. Wong Cho Shi and Ms. Chan (山東融匯房地產有限公司) Sun Ping Shandong Ronghui Property Co., Ltd. Controlled by Mr. Wong Cho Shi and Ms. Chan (山東融匯置業有限公司) Sun Ping Shandong Ronghui Western Property Co., Ltd. Controlled by Mr. Wong Cho Shi and Ms. Chan (山東融匯西區置業有限公司) Sun Ping Wuhu Ronghui Property Co., Ltd. Controlled by Mr. Wong Cho Shi and Ms. Chan (蕪湖融匯置業有限公司) Sun Ping

The English names of the PRC companies referred to above in this note represent management’s best efforts in translating the Chinese names of those companies as no English names have been registered or available.

(b) During the Track Record Period, the transactions with related parties of the Group carried in the ordinary course of business were as follows: Year ended 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Companies controlled by Mr. Wong Cho Shi and Ms. Chan Sun Ping Income from general property management services 10,272 10,623 10,338 Income from value-added services to non-property owners 15,200 19,121 21,297 Income from community value-added services 3,719 5,090 14,098 Income from commercial operational services to property developers and property owners – – 6,236 Purchase of gardening and cleaning services (2,910) (965) (798) Purchase of materials for marketing and employees benefit (356) (374) (513) Administration staff cost re-charge (1,118) (1,255) (1,383) Miscellaneous office expense (44) (133) (133) Utility expense (499) – – Lease expenses (661) (322) (93)

Joint ventures controlled by Mr. Wong Cho Shi and Ms. Chan Sun Ping Income from general property management services 1,557 1,461 2,241 Income from value-added services to non-property owners 6,671 6,537 6,721 Income from community value-added services 6 – – Purchase of materials for marketing and employees benefits (7) – (7)

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Group As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Amounts due from related parties Trade receivables – companies controlled by Mr. Wong Cho Shi and Ms. Chan Sun Ping (Note iii) 15,108 5,633 14,711 – joint ventures controlled by Mr. Wong Cho Shi and Ms. Chan Sun Ping (Note iii) 16,955 19,497 23,804

32,063 25,130 38,515 Other receivables – companies controlled by Mr. Wong Cho Shi and Ms. Chan Sun Ping (Note i, ii) 270,882 370,487 412,453

302,945 395,617 450,968

Amounts due to related parties Trade payable – companies controlled by Mr. Wong Cho Shi and Ms. Chan Sun Ping (Note i) 2,007 164 262

Other payables – companies controlled by Mr. Wong Cho Shi and Ms. Chan Sun Ping (Note i) 32,701 23,596 23,986 – joint ventures controlled by Mr. Wong Cho Shi and Ms. Chan Sun Ping (Note i) 74 53 163

32,775 23,649 24,149

Lease liabilities – companies controlled by Mr. Wong Cho Shi and Ms. Chan Sun Ping (Note i) 332 – 1,150

35,114 23,813 25,561

Notes:

(i) The amounts due are unsecured, interest-free, repayable on demand and denominated in RMB.

(ii) The maximum amount outstanding during the years ended 31 December 2018, 2019 and 2020 are RMB270,882,000, RMB370,487,000 and RMB412,453,000 respectively.

(iii) For terms of trade receivables, please refer to note 18(a).

(d) Financial guarantee obligations

During the three years ended 31 December 2018, 2019 and 2020, certain subsidiaries provided guarantee and/or pledges of future right of revenue of those subsidiaries to a bank in respect of banking facilities granted to companies controlled by Mr. Wong Cho Shi and Ms. Chan Sun Ping. The total financial guarantee and/or pledges provided by these subsidiaries during the years ended 31 December 2018, 2019 and 2020 were RMB280,000,000, RMB620,000,000 and RMB620,000,000, respectively. Revenue generated by these subsidiaries during the years ended 31 December 2018, 2019 and 2020 were approximately RMB20,748,000, RMB22,727,000 and RMB25,164,000, respectively.

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(e) Key management personnel remuneration

Key management of the Group are members of the board of directors and senior management. Included in employee benefit expenses are key management personnel remuneration which includes the following expenses:

Year ended 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Salaries, bonus and allowances 1,906 2,852 3,681 Retirement benefit scheme contributions and other benefits 554 244 154

2,460 3,096 3,835

28. NOTES TO THE COMBINED STATEMENTS OF CASH FLOWS

Reconciliation of liabilities arising from financing activities

The table below set out the reconciliation of liabilities arising from financing activities for each of the Track Record Period.

Amounts due to Lease related liabilities parties Total RMB’000 RMB’000 RMB’000

At 1 January 2018 949 18,332 19,281 Financing cash flows (662) 14,443 13,781 Non-cash transactions – Interest element of lease rental 45 – 45

At 31 December 2018 and 1 January 2019 332 32,775 33,107 Financing cash flows (363) (9,126) (9,489) Non-cash transactions – Interest element of lease rental 8 – 8 – Entering into new leases (Note) 46 – 46

At 31 December 2019 and 1 January 2020 23 23,649 23,672 Financing cash flows (174) 500 326 Non-cash transactions – Interest element of lease rental 25 – 25 – Entering into new leases (Note) 1,290 – 1,290

At 31 December 2020 1,164 24,149 25,313

Note:

Additions to right-of-use assets of approximately RMB46,000 and RMB1,290,000 were acquired under lease liabilities during the years ended 31 December 2019 and 2020, respectively.

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29. FINANCIAL RISK MANAGEMENT AND FAIR VALUE MEASUREMENTS

The Group is exposed to financial risks through its use of financial instruments in its ordinary course of operations and in its investment activities. The financial risks include credit risk, liquidity risk and market risk (including interest rate risk and foreign currency risk). The Group’s overall risk management strategy seeks to minimise potential adverse effects on the Group’s financial performance. Risk management is carried out by the senior management of the Group and approved by the board of directors.

29.1 Categories of financial assets and liabilities

The carrying amounts presented in the combined statements of financial position relate to the following categories of financial assets and financial liabilities:

As at 31 December 2018 2019 2020 RMB’000 RMB’000 RMB’000

Financial assets Financial assets measures at amortised costs Trade and other receivables 314,953 410,971 470,087 Bank balances and cash 92,827 45,997 74,733 Financial assets at fair value through profit or loss 8,429 12,847 –

416,209 469,815 544,820

Financial liabilities Financial liabilities measures at amortised cost Trade and other payables 106,788 102,079 108,034 Lease liabilities 332 23 1,164

107,120 102,102 109,198

29.2 Credit risk

The Group is exposed to credit risk in relation to its bank deposits and trade and other receivables. The Group’s maximum exposure to credit risk in relation to financial assets is limited to the carrying amount at the reporting dates.

To manage this risk, bank deposits are mainly placed with state-owned financial institutions and reputable banks which are all high-credit-quality financial institutions. The management does not expect that there will be any significant losses from non- performance by these counterparties.

The provision for expected credit loss for trade and other receivables was detailed in Note 18.

The Group has large number of counterparties for its other receivables other than those from related parties. 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 reporting date to ensure that adequate impairment losses are made for irrecoverable amounts. 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. Note 2.8 details how the Group determines whether there has been a significant increase in credit risk.

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29.3 Liquidity risk

Liquidity risk relates to the risk that the Group will not be able to meet its obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Group is exposed to liquidity risk in respect of settlement of trade and other payables and also in respect of its cash flow management. The Group’s objective is to maintain an appropriate level of liquid assets and committed lines of funding to meet its liquidity requirements in the short and longer term.

Analysed below is the Group’s remaining contractual maturities for its non-derivative financial liabilities as at 31 December 2018, 2019 and 2020. When the creditor has a choice of when the liability is settled, the liability is included on the basis of the earliest date when the Group can be required to pay. Where the settlement of the liability is in instalments, each instalment is allocated to the earliest period in which the Group is committed to pay.

Total Over 1 year Over 2 years undiscounted Within 1 year but within but within contractual Carrying or on demand 2 years 5 years amount amount RMB’000 RMB’000 RMB’000 RMB’000 RMB’000

As at 31 December 2018 Trade and other payables 106,788 – – 106,788 106,788 Lease liabilities 339 – – 339 332

107,127 – – 107,127 107,120

As at 31 December 2019 Trade and other payables 102,079 – – 102,079 102,079 Lease liabilities 24 – – 24 23

102,103 – – 102,103 102,102

As at 31 December 2020 Trade and other payables 108,034 – – 108,034 108,034 Lease liabilities 300 353 641 1,294 1,164

108,334 353 641 109,328 109,198

For financial guarantee provided to related companies, please refer to note 27(d) for details.

29.4 Interest rate risk

Other than the interest-bearing bank deposits, the Group has no other significant interest-bearing assets and liabilities. The directors of the Company do not anticipate there is any significant impact to the interest-bearing assets resulted from the changes in interest rates, because the interest rates of bank balance are not expected to change significantly.

29.5 Foreign currency risk

The Group operates mainly in PRC and majority of the transactions are denominated and settled in the functional currency of respective entities within the Group, RMB.

Foreign currency risk arises when future commercial transactions and recognised assets and liabilities are denominated in a currency that is not the entity’s functional currency. As at 31 December 2018, 2019 and 2020, the Group did not have significant foreign currency risk from its operations.

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The Group does not hedge its foreign currency risk. However, management monitors the foreign currency exposure and will consider hedging significant foreign currency exposure should the need arise.

29.6 Price risk

The Group has been exposed to the price risk of financial assets measured at FVTPL. The Group manages the equity price risk by placing limits on individual and total equity instruments. Reports on the equity portfolio are submitted to the Group’s senior management on a regular basis. The Group’s directors review and approve all equity investment decisions.

29.7 Fair value estimation

The table below analyses the Group’s financial instruments carried at fair value for the years ended 31 December 2018, 2019 and 2020 by level of inputs to valuation techniques used to measure fair value. Such inputs are categorised into three levels within a fair value hierarchy as follows:

• Quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1).

• Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices) (Level 2).

• Inputs for the asset or liability that are not based on observable market data (unobservable inputs) (Level 3).

Level 1 Level 2 Level 3 RMB’000 RMB’000 RMB’000

As at 31 December 2018 Financial assets at fair value through profit or loss – Equity securities 8,429 – –

As at 31 December 2019 Financial assets at fair value through profit or loss – Equity securities 12,847 – –

As at 31 December 2020 Financial assets at fair value through profit or loss – Equity securities – – –

There were no transfers among levels 1, 2 and 3 during the years ended 31 December 2018, 2019 and 2020.

The fair value of the financial assets at fair value through profit or loss is based on quoted market prices at the end of each Track Record Period.

The carrying amounts of the Group’s other financial assets and liabilities including cash and cash equivalents, trade and other receivables, trade and other payables and approximate their fair values due to their short maturities or the impact of discounting is not significant.

30. CAPITAL MANAGEMENT

The Group’s capital management objectives are to ensure the Group’s ability to continue as a going concern and to provide an adequate return to shareholders and benefits for other stakeholders and to maintain an optimal capital structure to enhance shareholders’ value in the long term.

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The Group actively and regularly reviews its capital structure and makes adjustments in light of changes in economic conditions. As part of this review, the directors of the Company consider cost of capital and the risks associated with the issued share capital. The Group may adjust the amount of dividends paid to shareholders, issue new shares, return capital to shareholders, raise new debt financing or sell assets to reduce debt.

31. SUBSEQUENT EVENTS

Save as disclosed elsewhere in this report, the following significant events took place subsequent to 31 December 2020:

(i) On 9 February 2021, the Group disposed all of the equity interest in Wuhu Ronghui Property Management Co., Ltd. to a purchaser, who is an independent third party and a shareholder of the disposed companies at a consideration of RMB1.

(ii) On 28 March 2021, the directors of Chongqing Ronghui Property Management Co., Ltd. declared dividend of RMB39,700,000 to the then shareholder.

(iii) On 28 March 2021, the directors of Fujian Ronghui Property Management Co., Ltd. declared dividend of RMB5,500,000 to the then shareholder.

(iv) On 28 March 2021, the directors of Chongqing Ronghui Guanling Commercial Real Estate Operation Management Co., Ltd. declared dividend of RMB15,800,000 to the then shareholder.

(v) On 28 March 2021, the directors of Chongqing Ronghui Commercial Management Co., Ltd. declared dividend of RMB4,000,000 to the then shareholder.

(vi) On 28 March 2021, the directors of Fuzhou Ronghui Real Estate Co., Ltd. declared dividend of RMB12,000,000 to the then shareholder.

(vii) On 28 March 2021, the directors of Shandong Ronghui Laoshangbu Commercial Operation Management Co., Ltd. declared dividend of RMB12,000,000 to the then shareholder.

(viii) By passing a shareholder resolution, the registered share capital of Chongqing Ronghui Property Management Co., Ltd. was reduced by RMB10,000,000 on 11 March 2021.

(ix) By passing a shareholder resolution, the registered share capital of Chongqing Ronghui Guanling Commercial Real Estate Operation Management Co., Ltd. was reduced by RMB140,000,000 on 10 February 2021.

(x) By passing a shareholder resolution, the registered share capital of Shandong Ronghui Creative Cultural Industry Co., Ltd. was reduced by RMB50,000,000 on 3 March 2021.

(xi) By passing a shareholder resolution, the registered share capital of Fuzhou Ronghui Real Estate Co., Ltd. was reduced by RMB5,000,000 on 3 March 2021.

(xii) On 25 May 2021, the Group entered into an acquisition agreement with two independent third parties to acquire 51% equity interest in Chongqing Xintianyuan Property Management Co., Ltd. at a consideration of RMB10,200,000. Up to 7 June 2021, the Group has settled RMB5,000,000 consideration by cash payment.

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 31 December 2020.

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The information set forth in this appendix does not form part of the accountants’ report on the historical financial information of the Group for each of the years ended 31 December 2018, 2019 and 2020 prepared by Grant Thornton Hong Kong Limited, Certified Public Accountant, Hong Kong, the reporting accountants of the Company, as set forth in Appendix I to this document (the “Accountant’s Report”), and is included herein for illustrative purposes only. The unaudited pro forma financial information should be read in conjunction with the section headed “Financial Information” in this document and the Accountants’ Report set forth in Appendix I to this document.

A. UNAUDITED PRO FORMA STATEMENT OF ADJUSTED COMBINED NET TANGIBLE ASSETS

The following is an illustrative unaudited pro forma statement of adjusted combined net tangible assets of the Group which has been prepared in accordance with paragraph 4.29 of the Listing Rules for the purpose of illustrating the effect of the [REDACTED] on the combined net tangible assets of the Group attributable to owners of the Company as at 31 December 2020, as if the [REDACTED] had taken place on 31 December 2020.

The unaudited pro forma statement of adjusted combined net tangible assets of the Group has been prepared for illustrative purposes only and, because of its hypothetical nature, it may not give a true picture of the combined net tangible assets of the Group attributable to owners of the Company had the [REDACTED] been completed as at 31 December 2020 or at any future dates. It is prepared based on the audited combined net tangible assets of the Group attributable to owners of the Company as at 31 December 2020 as set out in the Accountant’s Report, and adjusted as described below.

Based on the [REDACTED]of HK$[REDACTED] (RMB[REDACTED]) per share 377,360 [REDACTED][REDACTED][REDACTED][REDACTED]

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Notes:

(2) The estimated [REDACTED]fromthe[REDACTED] are based on [REDACTED] of an indicative [REDACTED]ofHK$[REDACTED] (equivalent to RMB[REDACTED]) and HK$[REDACTED] (equivalent to RMB[REDACTED]) per [REDACTED] Share, respectively (after deducting the [REDACTED] fees and other related expenses), and takes no account of any Shares which may be allotted and issued upon the exercise of the [REDACTED].

(4) No adjustment has been made to the unaudited pro forma adjusted combined net tangible assets of the Group attributable to owners of the Company as at 31 December 2020 to reflect any trading results or other transactions of the Group entered into subsequent to 31 December 2020. In particular, the unaudited pro forma adjusted net tangible assets of the Group attributable to equity holders of the Company has not taken into account the declaration of dividends of aggregated amount of RMB89 million by which was approved by the boards of the subsidiaries of the Group on 28 March 2020 and the reduction of registered capital of the subsidiaries with aggregated amount of RMB205 million. The unaudited pro forma adjusted net tangible assets per share would have been RMB[REDACTED] (equivalent to approximately HK$[REDACTED]) and RMB[REDACTED] (equivalent to approximately HK$[REDACTED]) per Share based on the [REDACTED]ofHK$[REDACTED] and HK$[REDACTED] per Share respectively, if the effect of such dividend and reduction of registered capital had been accounted for.

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[REDACTED]

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[REDACTED]

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[REDACTED]

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Set out below is a summary of certain provisions of the Memorandum and Articles of Association of the Company and of certain aspects of the company laws of the Cayman Islands.

The Company was incorporated in the Cayman Islands as an exempted company with limited liability on 1 February 2021 under the Cayman Companies Act. The Company’s constitutional documents consist of its Memorandum and Articles of Association.

1. MEMORANDUM OF ASSOCIATION

1.1 The Memorandum provides, inter alia, that the liability of members of the Company is limited and that the objects for which the Company is established are unrestricted (and therefore include acting as an investment company), and that the Company shall have and be capable of exercising any and all of the powers at any time or from time to time exercisable by a natural person or body corporate whether as principal, agent, contractor or otherwise and, since the Company is an exempted company, that the Company will not trade in the Cayman Islands with any person, firm or corporation except in furtherance of the business of the Company carried on outside the Cayman Islands.

1.2 By special resolution the Company may alter the Memorandum with respect to any objects, powers or other matters specified in it.

2. ARTICLES OF ASSOCIATION

The Articles were conditionally adopted on [●]. A summary of certain provisions of the Articles is set out below.

2.1 Shares

(a) Classes of shares

The share capital of the Company consists of ordinary shares.

(b) Variation of rights of existing shares or classes of shares

Subject to the Cayman Companies Act, if at any time the share capital of the Company is divided into different classes of shares, all or any of the special rights attached to any class of shares may (unless otherwise provided for by the terms of issue of the shares of that class) be varied, modified or abrogated either with the consent in writing of the holders of not less than three-fourths in nominal value of the issued shares of that class or with the sanction of a special resolution passed at a separate general meeting of the holders of the shares of that class. The provisions of the Articles relating to general meetings shall mutatis mutandis apply to every such separate general meeting, provided that the necessary quorum (other than at an adjourned meeting) shall be not less than two persons together holding (or, in the case of a shareholder being a corporation, by its duly authorised representative) or representing by proxy not less than one-third in nominal value of the issued shares

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of that class. Every holder of shares of the class shall be entitled on a poll to one vote for every such share held by him, and any holder of shares of the class present in person or by proxy may demand a poll.

Any special rights conferred upon the holders of any shares or class of shares shall not, unless otherwise expressly provided in the rights attaching to the terms of issue of such shares, be deemed to be varied by the creation or issue of further shares ranking pari passu therewith.

The Company may, by an ordinary resolution of its members: (a) increase its share capital by the creation of new shares of such amount as it thinks expedient; (b) consolidate or divide all or any of its share capital into shares of larger or smaller amount than its existing shares; (c) divide its unissued shares into several classes and attach to such shares any preferential, deferred, qualified or special rights, privileges or conditions; (d) subdivide its shares or any of them into shares of an amount smaller than that fixed by the Memorandum; (e) cancel any shares which, at the date of the resolution, have not been taken or agreed to be taken by any person and diminish the amount of its share capital by the amount of the shares so cancelled; (f) make provision for the allotment and issue of shares which do not carry any voting rights; (g) change the currency of denomination of its share capital; and (h) reduce its share premium account in any manner authorised and subject to any conditions prescribed by law.

(d) Transfer of shares

Subject to the Cayman Companies Act and the requirements of the Stock Exchange, all transfers of shares shall be effected by an instrument of transfer in the usual or common form or in such other form as the Board may approve and may be under hand or, if the transferor or transferee is a Clearing House (as defined in the Articles) or its nominee(s), under hand or by machine imprinted signature, or by such other manner of execution as the Board may approve from time to time.

Execution of the instrument of transfer shall be by or on behalf of the transferor and the transferee, provided that the Board may dispense with the execution of the instrument of transfer by the transferor or transferee or accept mechanically executed transfers. The transferor shall be deemed to remain the holder of a share until the name of the transferee is entered in the register of members of the Company in respect of that share.

The Board may, in its absolute discretion, at any time and from time to time remove any share on the principal register to any branch register or any share on any branch register to the principal register or any other branch register.

Unless the Board otherwise agrees, no shares on the principal register shall be removed to any branch register nor shall shares on any branch register be removed

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to the principal register or any other branch register. All removals and other documents of title shall be lodged for registration and registered, in the case of shares on any branch register, at the relevant registration office and, in the case of shares on the principal register, at the place at which the principal register is located.

The Board may, in its absolute discretion, decline to register a transfer of any share (not being a fully paid up share) to a person of whom it does not approve or on which the Company has a lien. It may also decline to register a transfer of any share issued under any share option scheme upon which a restriction on transfer subsists or a transfer of any share to more than four joint holders.

The Board may decline to recognise any instrument of transfer unless a certain fee, up to such maximum sum as the Stock Exchange may determine to be payable, is paid to the Company, the instrument of transfer is properly stamped (if applicable), is in respect of only one class of share and is lodged at the relevant registration office or the place at which the principal register is located accompanied by the relevant share certificate(s) and such other evidence as the Board may reasonably require is provided to show the right of the transferor to make the transfer (and if the instrument of transfer is executed by some other person on his behalf, the authority of that person so to do).

The register of members may, subject to the Listing Rules, be closed at such time or for such period not exceeding in the whole 30 days in each year as the Board may determine (or such longer period as the members of the Company may by ordinary resolution determine, provided that such period shall not be extended beyond 60 days in any year).

Fully paid shares shall be free from any restriction on transfer (except when permitted by the Stock Exchange) and shall also be free from all liens.

(e) Power of the Company to purchase its own shares

The Company may purchase its own shares subject to certain restrictions and the Board may only exercise this power on behalf of the Company subject to any applicable requirement imposed from time to time by the Articles or any code, rules or regulations issued from time to time by the Stock Exchange and/or the Securities and Futures Commission of Hong Kong.

Where the Company purchases for redemption a redeemable share, purchases not made through the market or by tender shall be limited to a maximum price and, if purchases are by tender, tenders shall be available to all members alike.

(f) Power of any subsidiary of the Company to own shares in the Company

There are no provisions in the Articles relating to the ownership of shares in the Company by a subsidiary.

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(g) Calls on shares and forfeiture of shares

The Board may, from time to time, make such calls as it thinks fit upon the members in respect of any monies unpaid on the shares held by them respectively (whether on account of the nominal value of the shares or by way of premium) and not by the conditions of allotment of such shares made payable at fixed times. A call may be made payable either in one sum or by instalments. If the sum payable in respect of any call or instalment is not paid on or before the day appointed for payment thereof, the person or persons from whom the sum is due shall pay interest on the same at such rate not exceeding 20 per cent per annum as the Board shall fix from the day appointed for payment to the time of actual payment, but the Board may waive payment of such interest wholly or in part. The Board may, if it thinks fit, receive from any member willing to advance the same, either in money or money’s worth, all or any part of the money uncalled and unpaid or instalments payable upon any shares held by him, and in respect of all or any of the monies so advanced the Company may pay interest at such rate (if any) not exceeding 20 per cent per annum as the Board may decide.

If a member fails to pay any call or instalment of a call on the day appointed for payment, the Board may, for so long as any part of the call or instalment remains unpaid, serve not less than 14 days’ notice on the member requiring payment of so much of the call or instalment as is unpaid, together with any interest which may have accrued and which may still accrue up to the date of actual payment. The notice shall name a further day (not earlier than the expiration of 14 days from the date of the notice) on or before which the payment required by the notice is to be made, and shall also name the place where payment is to be made. The notice shall also state that, in the event of non-payment at or before the appointed time, the shares in respect of which the call was made will be liable to be forfeited.

If the requirements of any such notice are not complied with, any share in respect of which the notice has been given may at any time thereafter, before the payment required by the notice has been made, be forfeited by a resolution of the Board to that effect. Such forfeiture will include all dividends and bonuses declared in respect of the forfeited share and not actually paid before the forfeiture.

A person whose shares have been forfeited shall cease to be a member in respect of the forfeited shares but shall, nevertheless, remain liable to pay to the Company all monies which, as at the date of forfeiture, were payable by him to the Company in respect of the shares together with (if the Board shall in its discretion so require) interest thereon from the date of forfeiture until payment at such rate not exceeding 20 per cent per annum as the Board may prescribe.

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2.2 Directors

(a) Appointment, retirement and removal

At any time or from time to time, the Board shall have the power to appoint any person as a Director either to fill a casual vacancy on the Board or as an additional Director to the existing Board subject to any maximum number of Directors, if any, as may be determined by the members in general meeting. Any Director so appointed to fill a casual vacancy shall hold office only until the first general meeting of the Company after his appointment and be subject to re-election at such meeting. Any Director so appointed as an addition to the existing Board shall hold office only until the first annual general meeting of the Company after his appointment and be eligible for re-election at such meeting. Any Director so appointed by the Board shall not be taken into account in determining the Directors or the number of Directors who are to retire by rotation at an annual general meeting.

At each annual general meeting, one-third of the Directors for the time being shall retire from office by rotation. However, if the number of Directors is not a multiple of three, then the number nearest to but not less than one-third shall be the number of retiring Directors. Every Director (including those appointed for a specific term) shall be subject to retirement by rotation at least once every three years. The Directors to retire in each year shall be those who have been in office longest since their last re-election or appointment but, as between persons who became or were last re-elected Directors on the same day, those to retire shall (unless they otherwise agree among themselves) be determined by lot.

No person, other than a retiring Director, shall, unless recommended by the Board for election, be eligible for election to the office of Director at any general meeting, unless notice in writing of the intention to propose that person for election as a Director and notice in writing by that person of his willingness to be elected has been lodged at the head office or at the registration office of the Company. The period for lodgment of such notices shall commence no earlier than the day after despatch of the notice of the relevant meeting and end no later than seven days before the date of such meeting and the minimum length of the period during which such notices may be lodged must be at least seven days.

A Director is not required to hold any shares in the Company by way of qualification nor is there any specified upper or lower age limit for Directors either for accession to or retirement from the Board.

A Director may be removed by an ordinary resolution of the Company before the expiration of his term of office (but without prejudice to any claim which such Director may have for damages for any breach of any contract between him and the Company) and the Company may by ordinary resolution appoint another in his

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place. Any Director so appointed shall be subject to the retirement by rotation provisions. The number of Directors shall not be less than two.

The office of a Director shall be vacated if he:

(i) resigns;

(ii) dies;

(iii) is declared to be of unsound mind and the Board resolves that his office be vacated;

(iv) becomes bankrupt or has a receiving order made against him or suspends payment or compounds with his creditors generally;

(v) he is prohibited from being or ceases to be a director by operation of law;

(vi) without special leave, is absent from meetings of the Board for six consecutive months, and the Board resolves that his office is vacated;

(vii) has been required by the stock exchange of the Relevant Territory (as defined in the Articles) to cease to be a Director; or

(viii) is removed from office by the requisite majority of the Directors or otherwise pursuant to the Articles.

From time to time the Board may appoint one or more of its body to be managing director, joint managing director or deputy managing director or to hold any other employment or executive office with the Company for such period and upon such terms as the Board may determine, and the Board may revoke or terminate any of such appointments. The Board may also delegate any of its powers to committees consisting of such Director(s) or other person(s) as the Board thinks fit, and from time to time it may also revoke such delegation or revoke the appointment of and discharge any such committees either wholly or in part, and either as to persons or purposes, but every committee so formed shall, in the exercise of the powers so delegated, conform to any regulations that may from time to time be imposed upon it by the Board.

(b) Power to allot and issue shares and warrants

Subject to the provisions of the Cayman Companies Act, the Memorandum and Articles and without prejudice to any special rights conferred on the holders of any shares or class of shares, any share may be issued with or have attached to it such rights, or such restrictions, whether with regard to dividend, voting, return of capital or otherwise, as the Company may by ordinary resolution determine (or, in the absence of any such determination or so far as the same may not make specific

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provision, as the Board may determine). Any share may be issued on terms that, upon the happening of a specified event or upon a given date and either at the option of the Company or the holder of the share, it is liable to be redeemed.

The Board may issue warrants to subscribe for any class of shares or other securities of the Company on such terms as it may from time to time determine.

Where warrants are issued to bearer, no certificate in respect of such warrants shall be issued to replace one that has been lost unless the Board is satisfied beyond reasonable doubt that the original certificate has been destroyed and the Company has received an indemnity in such form as the Board thinks fit with regard to the issue of any such replacement certificate.

Subject to the provisions of the Cayman Companies Act, the Articles and, where applicable, the rules of any stock exchange of the Relevant Territory and without prejudice to any special rights or restrictions for the time being attached to any shares or any class of shares, all unissued shares in the Company shall be at the disposal of the Board, which may offer, allot, grant options over or otherwise dispose of them to such persons, at such times, for such consideration and on such terms and conditions as it in its absolute discretion thinks fit, provided that no shares shall be issued at a discount.

Neither the Company nor the Board shall be obliged, when making or granting any allotment of, offer of, option over or disposal of shares, to make, or make available, any such allotment, offer, option or shares to members or others whose registered addresses are in any particular territory or territories where, in the absence of a registration statement or other special formalities, this is or may, in the opinion of the Board, be unlawful or impracticable. However, no member affected as a result of the foregoing shall be, or be deemed to be, a separate class of members for any purpose whatsoever.

While there are no specific provisions in the Articles relating to the disposal of the assets of the Company or any of its subsidiaries, the Board may exercise all powers and do all acts and things which may be exercised or done or approved by the Company and which are not required by the Articles or the Cayman Companies Act to be exercised or done by the Company in general meeting, but if such power or act is regulated by the Company in general meeting, such regulation shall not invalidate any prior act of the Board which would have been valid if such regulation had not been made.

(d) Borrowing powers

The Board may exercise all the powers of the Company to raise or borrow money, to mortgage or charge all or any part of the undertaking, property and uncalled capital of the Company and, subject to the Cayman Companies Act, to

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issue debentures, debenture stock, bonds and other securities of the Company, whether outright or as collateral security for any debt, liability or obligation of the Company or of any third party.

(e) Remuneration

The Directors shall be entitled to receive, as ordinary remuneration for their services, such sums as shall from time to time be determined by the Board or the Company in general meeting, as the case may be, such sum (unless otherwise directed by the resolution by which it is determined) to be divided among the Directors in such proportions and in such manner as they may agree or, failing agreement, either equally or, in the case of any Director holding office for only a portion of the period in respect of which the remuneration is payable, pro rata. The Directors shall also be entitled to be repaid all expenses reasonably incurred by them in attending any Board meetings, committee meetings or general meetings or otherwise in connection with the discharge of their duties as Directors. Such remuneration shall be in addition to any other remuneration to which a Director who holds any salaried employment or office in the Company may be entitled by reason of such employment or office.

Any Director who, at the request of the Company, performs services which in the opinion of the Board go beyond the ordinary duties of a Director may be paid such special or extra remuneration as the Board may determine, in addition to or in substitution for any ordinary remuneration as a Director. An executive Director appointed to be a managing director, joint managing director, deputy managing director or other executive officer shall receive such remuneration and such other benefits and allowances as the Board may from time to time decide. Such remuneration shall be in addition to his ordinary remuneration as a Director.

The Board may establish, either on its own or jointly in concurrence or agreement with subsidiaries of the Company or companies with which the Company is associated in business, or may make contributions out of the Company’s monies to, any schemes or funds for providing pensions, sickness or compassionate allowances, life assurance or other benefits for employees (which expression as used in this and the following paragraph shall include any Director or former Director who may hold or have held any executive office or any office of profit with the Company or any of its subsidiaries) and former employees of the Company and their dependents or any class or classes of such persons.

The Board may also pay, enter into agreements to pay or make grants of revocable or irrevocable, whether or not subject to any terms or conditions, pensions or other benefits to employees and former employees and their dependents, or to any of such persons, including pensions or benefits additional to those, if any, to which such employees or former employees or their dependents are or may become entitled under any such scheme or fund as mentioned above. Such pension or benefit may, if deemed desirable by the Board, be granted to an employee either before and in anticipation of, or upon or at any time after, his actual retirement.

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(f) Compensation or payments for loss of office

Payments to any present Director or past Director of any sum by way of compensation for loss of office or as consideration for or in connection with his retirement from office (not being a payment to which the Director is contractually or statutorily entitled) must be approved by the Company in general meeting.

(g) Loans and provision of security for loans to Directors

The Company shall not directly or indirectly make a loan to a Director or a director of any holding company of the Company or any of their respective close associates, enter into any guarantee or provide any security in connection with a loan made by any person to a Director or a director of any holding company of the Company or any of their respective close associates, or, if any one or more Directors hold(s) (jointly or severally or directly or indirectly) a controlling interest in another company, make a loan to that other company or enter into any guarantee or provide any security in connection with a loan made by any person to that other company.

(h) Disclosure of interest in contracts with the Company or any of its subsidiaries

With the exception of the office of auditor of the Company, a Director may hold any other office or place of profit with the Company in conjunction with his office of Director for such period and upon such terms as the Board may determine, and may be paid such extra remuneration for that other office or place of profit, in whatever form, in addition to any remuneration provided for by or pursuant to any other Articles. A Director may be or become a director, officer or member of any other company in which the Company may be interested, and shall not be liable to account to the Company or the members for any remuneration or other benefits received by him as a director, officer or member of such other company. The Board may also cause the voting power conferred by the shares in any other company held or owned by the Company to be exercised in such manner in all respects as it thinks fit, including the exercise in favour of any resolution appointing the Directors or any of them to be directors or officers of such other company.

No Director or intended Director shall be disqualified by his office from contracting with the Company, nor shall any such contract or any other contract or arrangement in which any Director is in any way interested be liable to be avoided, nor shall any Director so contracting or being so interested be liable to account to the Company for any profit realised by any such contract or arrangement by reason only of such Director holding that office or the fiduciary relationship established by it. A Director who is, in any way, materially interested in a contract or arrangement or proposed contract or arrangement with the Company shall declare the nature of his interest at the earliest meeting of the Board at which he may practically do so.

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There is no power to freeze or otherwise impair any of the rights attaching to any share by reason that the person or persons who are interested directly or indirectly in that share have failed to disclose their interests to the Company.

A Director shall not vote or be counted in the quorum on any resolution of the Board in respect of any contract or arrangement or proposal in which he or any of his close associate(s) has/have a material interest, and if he shall do so his vote shall not be counted nor shall he be counted in the quorum for that resolution, but this prohibition shall not apply to any of the following matters:

(i) the giving of any security or indemnity to the Director or his close associate(s) in respect of money lent or obligations incurred or undertaken by him or any of them at the request of or for the benefit of the Company or any of its subsidiaries;

(ii) the giving of any security or indemnity to a third party in respect of a debt or obligation of the Company or any of its subsidiaries for which the Director or his close associate(s) has/have himself/themselves assumed responsibility in whole or in part whether alone or jointly under a guarantee or indemnity or by the giving of security;

(iii) any proposal concerning an offer of shares, debentures or other securities of or by the Company or any other company which the Company may promote or be interested in for subscription or purchase, where the Director or his close associate(s) is/are or is/are to be interested as a participant in the underwriting or sub- underwriting of the offer;

(iv) any proposal or arrangement concerning the benefit of employees of the Company or any of its subsidiaries, including the adoption, modification or operation of either: (i) any employees’ share scheme or any share incentive or share option scheme under which the Director or his close associate(s) may benefit; or (ii) any of a pension fund or retirement, death or disability benefits scheme which relates to Directors, their close associates and employees of the Company or any of its subsidiaries and does not provide in respect of any Director or his close associate(s) any privilege or advantage not generally accorded to the class of persons to which such scheme or fund relates; and

(v) any contract or arrangement in which the Director or his close associate(s) is/are interested in the same manner as other holders of shares, debentures or other securities of the Company by virtue only of his/their interest in those shares, debentures or other securities.

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2.3 Proceedings of the Board

The Board may meet anywhere in the world for the despatch of business and may adjourn and otherwise regulate its meetings as it thinks fit. Questions arising at any meeting shall be determined by a majority of votes. In the case of an equality of votes, the chairman of the meeting shall have a second or casting vote.

2.4 Alterations to the constitutional documents and the Company’s name

To the extent that the same is permissible under the Cayman Islands laws and subject to the Articles, the Memorandum and Articles of the Company may only be altered or amended, and the name of the Company may only be changed, with the sanction of a special resolution of the Company.

2.5 Meetings of members

(a) Special and ordinary resolutions

A special resolution of the Company must be passed by a majority of not less than three-fourths of the votes cast by such members as, being entitled so to do, vote in person or by proxy or, in the case of members which are corporations, by their duly authorised representatives or by proxy at a general meeting of which notice specifying the intention to propose the resolution as a special resolution has been duly given.

Under the Cayman Companies Act, a copy of any special resolution must be forwarded to the Registrar of Companies in the Cayman Islands within 15 days of being passed.

An ordinary resolution, by contrast, is a resolution passed by a simple majority of the votes of such members of the Company as, being entitled to do so, vote in person or, in the case of members which are corporations, by their duly authorised representatives or by proxy at a general meeting of which notice has been duly given.

A resolution in writing signed by or on behalf of all members shall be treated as an ordinary resolution duly passed at a general meeting of the Company duly convened and held, and where relevant as a special resolution so passed.

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(b) Voting rights and right to demand a poll

Subject to any special rights, restrictions or privileges as to voting for the time being attached to any class or classes of shares at any general meeting: (a) on a poll every member present in person or by proxy or, in the case of a member being a corporation, by its duly authorised representative shall have one vote for every share which is fully paid or credited as fully paid registered in his name in the register of members of the Company, provided that no amount paid up or credited as paid up on a share in advance of calls or instalments is treated for this purpose as paid up on the share; and (b) on a show of hands every member who is present in person (or, in the case of a member being a corporation, by its duly authorised representative) or by proxy shall have one vote. Where more than one proxy is appointed by a member which is a Clearing House or its nominee(s), each such proxy shall have one vote on a show of hands. On a poll, a member entitled to more than one vote need not use all his votes or cast all the votes he does use in the same way.

At any general meeting a resolution put to the vote of the meeting is to be decided by poll save that the chairman of the meeting may, pursuant to the Listing Rules, allow a resolution to be voted on by a show of hands. Where a show of hands is allowed, before or on the declaration of the result of the show of hands, a poll may be demanded by (in each case by members present in person or by proxy or by a duly authorised corporate representative):

(i) at least two members;

(ii) any member or members representing not less than one-tenth of the total voting rights of all the members having the right to vote at the meeting; or

(iii) a member or members holding shares in the Company conferring a right to vote at the meeting on which an aggregate sum has been paid equal to not less than one-tenth of the total sum paid up on all the shares conferring that right.

Should a Clearing House or its nominee(s) be a member of the Company, such person or persons may be authorised as it thinks fit to act as its representative(s) at any meeting of the Company or at any meeting of any class of members of the Company provided that, if more than one person is so authorised, the authorisation shall specify the number and class of shares in respect of which each such person is so authorised. A person authorised in accordance with this provision shall be deemed to have been duly authorised without further evidence of the facts and be entitled to exercise the same rights and powers on behalf of the Clearing House or its nominee(s) as if such person were an individual member including the right to vote individually on a show of hands.

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Where the Company has knowledge that any member is, under the Listing Rules, required to abstain from voting on any particular resolution or restricted to voting only for or only against any particular resolution, any votes cast by or on behalf of such member in contravention of such requirement or restriction shall not be counted.

The Company must hold an annual general meeting each year other than the year of the Company’s adoption of the Articles. Such meeting must be held not more than 15 months after the holding of the last preceding annual general meeting, or such longer period as may be authorised by the Stock Exchange at such time and place as may be determined by the Board.

(d) Notices of meetings and business to be conducted

An annual general meeting of the Company shall be called by at least 21 days’ (and not less than 20 clear business days’) notice in writing, and any other general meeting of the Company shall be called by at least 14 days’ (and not less than 10 clear business days’) notice in writing. The notice shall be exclusive of the day on which it is served or deemed to be served and of the day for which it is given, and must specify the time, place and agenda of the meeting and particulars of the resolution(s) to be considered at that meeting and, in the case of special business, the general nature of that business.

Except where otherwise expressly stated, any notice or document (including a share certificate) to be given or issued under the Articles shall be in writing, and may be served by the Company on any member personally, by post to such member’s registered address or (in the case of a notice) by advertisement in the newspapers. Any member whose registered address is outside Hong Kong may notify the Company in writing of an address in Hong Kong which shall be deemed to be his registered address for this purpose. Subject to the Cayman Companies Act and the Listing Rules, a notice or document may also be served or delivered by the Company to any member by electronic means.

Although a meeting of the Company may be called by shorter notice than as specified above, such meeting may be deemed to have been duly called if it is so agreed:

(i) in the case of an annual general meeting, by all members of the Company entitled to attend and vote thereat; and

(ii) in the case of any other meeting, by a majority in number of the members having a right to attend and vote at the meeting holding not less than 95 per cent of the total voting rights in the Company.

All business transacted at an extraordinary general meeting shall be deemed special business. All business shall also be deemed special business where it is

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transacted at an annual general meeting, with the exception of certain routine matters which shall be deemed ordinary business.

(e) Quorum for meetings and separate class meetings

No business shall be transacted at any general meeting unless a quorum is present when the meeting proceeds to business, and continues to be present until the conclusion of the meeting.

The quorum for a general meeting shall be two members present in person (or in the case of a member being a corporation, by its duly authorised representative) or by proxy and entitled to vote. In respect of a separate class meeting (other than an adjourned meeting) convened to sanction the modification of class rights, the necessary quorum shall be two persons holding or representing by proxy not less than one-third in nominal value of the issued shares of that class.

(f) Proxies

Any member of the Company entitled to attend and vote at a meeting of the Company is entitled to appoint another person as his proxy to attend and vote instead of him. A member who is the holder of two or more shares may appoint more than one proxy to represent him and vote on his behalf at a general meeting of the Company or at a class meeting. A proxy need not be a member of the Company and shall be entitled to exercise the same powers on behalf of a member who is an individual and for whom he acts as proxy as such member could exercise. In addition, a proxy shall be entitled to exercise the same powers on behalf of a member which is a corporation and for which he acts as proxy as such member could exercise if it were an individual member. On a poll or on a show of hands, votes may be given either personally (or, in the case of a member being a corporation, by its duly authorised representative) or by proxy.

The instrument appointing a proxy shall be in writing under the hand of the appointor or of his attorney duly authorised in writing, or if the appointor is a corporation, either under seal or under the hand of a duly authorised officer or attorney. Every instrument of proxy, whether for a specified meeting or otherwise, shall be in such form as the Board may from time to time approve, provided that it shall not preclude the use of the two-way form. Any form issued to a member for appointing a proxy to attend and vote at an extraordinary general meeting or at an annual general meeting at which any business is to be transacted shall be such as to enable the member, according to his intentions, to instruct the proxy to vote in favour of or against (or, in default of instructions, to exercise his discretion in respect of) each resolution dealing with any such business.

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(g) Members’ requisition for meetings

Extraordinary general meetings shall be convened on the requisition of one or more members holding, as at the date of deposit of the requisition, not less than one-tenth of the paid up capital of the Company having the right of voting at general meetings. Such requisition shall be made in writing to the Board or the secretary of the Company for the purpose of requiring an extraordinary general meeting to be called by the Board for the transaction of any business specified in such requisition. Such meeting shall be held within two months after the deposit of such requisition. If within 21 days of such deposit, the Board fails to proceed to convene such meeting, the requisitionist(s) himself (themselves) may do so in the same manner, and all reasonable expenses incurred by the requisitionist(s) as a result of the failure of the Board shall be reimbursed to the requisitionist(s) by the Company.

2.6 Accounts and audit

The Board shall cause proper books of account to be kept of the sums of money received and expended by the Company, and of the assets and liabilities of the Company and of all other matters required by the Cayman Companies Act (which include all sales and purchases of goods by the Company) necessary to give a true and fair view of the state of the Company’s affairs and to show and explain its transactions.

The books of accounts of the Company shall be kept at the head office of the Company or at such other place or places as the Board decides and shall always be open to inspection by any Director. No member (other than a Director) shall have any right to inspect any account, book or document of the Company except as conferred by the Cayman Companies Act or ordered by a court of competent jurisdiction or authorised by the Board or the Company in general meeting.

The Board shall from time to time cause to be prepared and laid before the Company at its annual general meeting balance sheets and profit and loss accounts (including every document required by law to be annexed thereto), together with a copy of the Directors’ report and a copy of the auditors’ report, not less than 21 days before the date of the annual general meeting. Copies of these documents shall be sent to every person entitled to receive notices of general meetings of the Company under the provisions of the Articles together with the notice of annual general meeting, not less than 21 days before the date of the meeting.

Subject to the rules of the stock exchange of the Relevant Territory, the Company may send summarised financial statements to shareholders who have, in accordance with the rules of the stock exchange of the Relevant Territory, consented and elected to receive summarised financial statements instead of the full financial statements. The summarised financial statements must be accompanied by any other documents as may be required under the rules of the stock exchange of the Relevant Territory, and must be sent to those

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shareholders that have consented and elected to receive the summarised financial statements not less than 21 days before the general meeting.

The Company shall appoint auditor(s) to hold office until the conclusion of the next annual general meeting on such terms and with such duties as may be agreed with the Board. The auditors’ remuneration shall be fixed by the Company in general meeting or by the Board if authority is so delegated by the members. The members may, at any general meeting convened and held in accordance with the Articles, remove the auditors by special resolution at any time before the expiration of the term of office and shall, by ordinary resolution, at that meeting appoint new auditors in its place for the remainder of the term.

The auditors shall audit the financial statements of the Company in accordance with generally accepted accounting principles of Hong Kong, the International Accounting Standards or such other standards as may be permitted by the Stock Exchange.

2.7 Dividends and other methods of distribution

The Company in general meeting may declare dividends in any currency to be paid to the members but no dividend shall be declared in excess of the amount recommended by the Board.

Except in so far as the rights attaching to, or the terms of issue of, any share may otherwise provide:

(a) all dividends shall be declared and paid according to the amounts paid up on the shares in respect of which the dividend is paid, although no amount paid up on a share in advance of calls shall for this purpose be treated as paid up on the share;

(b) all dividends shall be apportioned and paid pro rata in accordance with the amount paid up on the shares during any portion(s) of the period in respect of which the dividend is paid; and

(c) the Board may deduct from any dividend or other monies payable to any member all sums of money (if any) presently payable by him to the Company on account of calls, instalments or otherwise.

Where the Board or the Company in general meeting has resolved that a dividend should be paid or declared, the Board may resolve:

(i) that such dividend be satisfied wholly or in part in the form of an allotment of shares credited as fully paid up, provided that the members entitled to such dividend will be entitled to elect to receive such dividend (or part thereof) in cash in lieu of such allotment; or

(ii) that the members entitled to such dividend will be entitled to elect to receive an allotment of shares credited as fully paid up in lieu of the whole or such part of the dividend as the Board may think fit.

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Upon the recommendation of the Board, the Company may by ordinary resolution in respect of any one particular dividend of the Company determine that it may be satisfied wholly in the form of an allotment of shares credited as fully paid up without offering any right to members to elect to receive such dividend in cash in lieu of such allotment.

Any dividend, bonus or other sum payable in cash to the holder of shares may be paid by cheque or warrant sent through the post. Every such cheque or warrant shall be made payable to the order of the person to whom it is sent and shall be sent at the holder’s or joint holders’ risk and payment of the cheque or warrant by the bank on which it is drawn shall constitute a good discharge to the Company. Any one of two or more joint holders may give effectual receipts for any dividends or other monies payable or property distributable in respect of the shares held by such joint holders.

Whenever the Board or the Company in general meeting has resolved that a dividend be paid or declared, the Board may further resolve that such dividend be satisfied wholly or in part by the distribution of specific assets of any kind.

The Board may, if it thinks fit, receive from any member willing to advance the same, and either in money or money’s worth, all or any part of the money uncalled and unpaid or instalments payable upon any shares held by him, and in respect of all or any of the monies so advanced may pay interest at such rate (if any) not exceeding 20 per cent per annum, as the Board may decide, but a payment in advance of a call shall not entitle the member to receive any dividend or to exercise any other rights or privileges as a member in respect of the share or the due portion of the shares upon which payment has been advanced by such member before it is called up.

All dividends, bonuses or other distributions unclaimed for one year after having been declared may be invested or otherwise used by the Board for the benefit of the Company until claimed and the Company shall not be constituted a trustee in respect thereof. All dividends, bonuses or other distributions unclaimed for six years after having been declared may be forfeited by the Board and, upon such forfeiture, shall revert to the Company.

No dividend or other monies payable by the Company on or in respect of any share shall bear interest against the Company.

The Company may exercise the power to cease sending cheques for dividend entitlements or dividend warrants by post if such cheques or warrants remain uncashed on two consecutive occasions or after the first occasion on which such a cheque or warrant is returned undelivered.

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2.8 Inspection of corporate records

For so long as any part of the share capital of the Company is listed on the Stock Exchange, any member may inspect any register of members of the Company maintained in Hong Kong (except when the register of members is closed) without charge and require the provision to him of copies or extracts of such register in all respects as if the Company were incorporated under and were subject to the Hong Kong Companies Ordinance.

2.9 Rights of minorities in relation to fraud or oppression

There are no provisions in the Articles concerning the rights of minority members in relation to fraud or oppression. However, certain remedies may be available to members of the Company under the Cayman Islands laws, as summarised in paragraph 3.6 of this Appendix.

2.10 Procedures on liquidation

A resolution that the Company be wound up by the court or be wound up voluntarily shall be a special resolution.

Subject to any special rights, privileges or restrictions as to the distribution of available surplus assets on liquidation for the time being attached to any class or classes of shares:

(a) if the Company is wound up and the assets available for distribution among the members of the Company are more than sufficient to repay the whole of the capital paid up at the commencement of the winding up, then the excess shall be distributed pari passu among such members in proportion to the amount paid up on the shares held by them respectively; and

(b) if the Company is wound up and the assets available for distribution among the members as such are insufficient to repay the whole of the paid-up capital, such assets shall be distributed so that, as nearly as may be, the losses shall be borne by the members in proportion to the capital paid up on the shares held by them, respectively.

If the Company is wound up (whether the liquidation is voluntary or compelled by the court), the liquidator may, with the sanction of a special resolution and any other sanction required by the Cayman Companies Act, divide among the members in specie or kind the whole or any part of the assets of the Company, whether the assets consist of property of one kind or different kinds, and the liquidator may, for such purpose, set such value as he deems fair upon any one or more class or classes of property to be so divided and may determine how such division shall be carried out as between the members or different classes of members and the members within each class. The liquidator may, with the like sanction, vest any part of the assets in trustees upon such trusts for the benefit of

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members as the liquidator thinks fit, provided that no member shall be compelled to accept any shares or other property upon which there is a liability.

2.11 Subscription rights reserve

Provided that it is not prohibited by and is otherwise in compliance with the Cayman Companies Act, if warrants to subscribe for shares have been issued by the Company and the Company does any act or engages in any transaction which would result in the subscription price of such warrants being reduced below the par value of the shares to be issued on the exercise of such warrants, a subscription rights reserve shall be established and applied in paying up the difference between the subscription price and the par value of such shares.

3. COMPANY LAWS OF THE CAYMAN ISLANDS

The Company was incorporated in the Cayman Islands as an exempted company on 1 February 2021 subject to the Cayman Companies Act. Certain provisions of the company laws of the Cayman Islands are set out below but this section does not purport to contain all applicable qualifications and exceptions or to be a complete review of all matters of the company laws of the Cayman Islands, which may differ from equivalent provisions in jurisdictions with which interested parties may be more familiar.

3.1 Company operations

An exempted company such as the Company must conduct its operations mainly outside the Cayman Islands. An exempted company is also required to file an annual return each year with the Registrar of Companies of the Cayman Islands and pay a fee which is based on the amount of its authorised share capital.

3.2 Share capital

Under the Cayman Companies Act, a Cayman Islands company may issue ordinary, preference or redeemable shares or any combination thereof. Where a company issues shares at a premium, whether for cash or otherwise, a sum equal to the aggregate amount or value of the premiums on those shares shall be transferred to an account, to be called the share premium account. At the option of a company, these provisions may not apply to premiums on shares of that company allotted pursuant to any arrangements in consideration of the acquisition or cancellation of shares in any other company and issued at a premium. The share premium account may be applied by the company subject to the provisions, if any, of its memorandum and articles of association, in such manner as the company may from time to time determine including, but without limitation, the following:

(a) paying distributions or dividends to members;

(b) paying up unissued shares of the company to be issued to members as fully paid bonus shares;

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(d) writing-off the preliminary expenses of the company; and

(e) writing-off the expenses of, or the commission paid or discount allowed on, any issue of shares or debentures of the company.

Notwithstanding the foregoing, no distribution or dividend may be paid to members out of the share premium account unless, immediately following the date on which the distribution or dividend is proposed to be paid, the company will be able to pay its debts as they fall due in the ordinary course of business.

Subject to confirmation by the court, a company limited by shares or a company limited by guarantee and having a share capital may, if authorised to do so by its articles of association, by special resolution reduce its share capital in any way.

3.3 Financial assistance to purchase shares of a company or its holding company

There are no statutory prohibitions in the Cayman Islands on the granting of financial assistance by a company to another person for the purchase of, or subscription for, its own, its holding company’s or a subsidiary’s shares. Therefore, a company may provide financial assistance provided the directors of the company, when proposing to grant such financial assistance, discharge their duties of care and act in good faith, for a proper purpose and in the interests of the company. Such assistance should be on an arm’s-length basis.

3.4 Purchase of shares and warrants by a company and its subsidiaries

A company limited by shares or a company limited by guarantee and having a share capital may, if so authorised by its articles of association, issue shares which are to be redeemed or are liable to be redeemed at the option of the company or a member and, for the avoidance of doubt, it shall be lawful for the rights attaching to any shares to be varied, subject to the provisions of the company’s articles of association, so as to provide that such shares are to be or are liable to be so redeemed. In addition, such a company may, if authorised to do so by its articles of association, purchase its own shares, including any redeemable shares; an ordinary resolution of the company approving the manner and terms of the purchase will be required if the articles of association do not authorise the manner and terms of such purchase. A company may not redeem or purchase its shares unless they are fully paid. Furthermore, a company may not redeem or purchase any of its shares if, as a result of the redemption or purchase, there would no longer be any issued shares of the company other than shares held as treasury shares. In addition, a payment out of capital by a company for the redemption or purchase of its own shares is not lawful unless, immediately following the date on which the payment is proposed to be made, the company shall be able to pay its debts as they fall due in the ordinary course of business.

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Shares that have been purchased or redeemed by a company or surrendered to the company shall not be treated as cancelled but shall be classified as treasury shares if held in compliance with the requirements of Section 37A(1) of the Cayman Companies Act. Any such shares shall continue to be classified as treasury shares until such shares are either cancelled or transferred pursuant to the Cayman Companies Act.

A Cayman Islands company may be able to purchase its own warrants subject to and in accordance with the terms and conditions of the relevant warrant instrument or certificate. Thus there is no requirement under the Cayman Islands laws that a company’s memorandum or articles of association contain a specific provision enabling such purchases. The directors of a company may under the general power contained in its memorandum of association be able to buy, sell and deal in personal property of all kinds.

A subsidiary may hold shares in its holding company and, in certain circumstances, may acquire such shares.

3.5 Dividends and distributions

Subject to a solvency test, as prescribed in the Cayman Companies Act, and the provisions, if any, of the company’s memorandum and articles of association, a company may pay dividends and distributions out of its share premium account. In addition, based upon English case law which is likely to be persuasive in the Cayman Islands, dividends may be paid out of profits.

For so long as a company holds treasury shares, no dividend may be declared or paid, and no other distribution (whether in cash or otherwise) of the company’s assets (including any distribution of assets to members on a winding up) may be made, in respect of a treasury share.

3.6 Protection of minorities and shareholders’ suits

It can be expected that the Cayman Islands courts will ordinarily follow English case law precedents (particularly the rule in the case of Foss vs. Harbottle and the exceptions to that rule) which permit a minority member to commence a representative action against or derivative actions in the name of the company to challenge acts which are ultra vires, illegal, fraudulent (and performed by those in control of the Company) against the minority, or represent an irregularity in the passing of a resolution which requires a qualified (or special) majority which has not been obtained.

Where a company (not being a bank) is one which has a share capital divided into shares, the court may, on the application of members holding not less than one-fifth of the shares of the company in issue, appoint an inspector to examine the affairs of the company and, at the direction of the court, to report on such affairs. In addition, any member of a company may petition the court, which may make a winding up order if the court is of the opinion that it is just and equitable that the company should be wound up.

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In general, claims against a company by its members must be based on the general laws of contract or tort applicable in the Cayman Islands or be based on potential violation of their individual rights as members as established by a company’s memorandum and articles of association.

3.7 Disposal of assets

There are no specific restrictions on the power of directors to dispose of assets of a company, however, the directors are expected to exercise certain duties of care, diligence and skill to the standard that a reasonably prudent person would exercise in comparable circumstances, in addition to fiduciary duties to act in good faith, for proper purpose and in the best interests of the company under English common law (which the Cayman Islands courts will ordinarily follow).

3.8 Accounting and auditing requirements

A company must cause proper records of accounts to be kept with respect to: (i) all sums of money received and expended by it; (ii) all sales and purchases of goods by it; and (iii) its assets and liabilities.

Proper books of account shall not be deemed to be kept if there are not kept such books as are necessary to give a true and fair view of the state of the company’s affairs and to explain its transactions.

If a company keeps its books of account at any place other than at its registered office or any other place within the Cayman Islands, it shall, upon service of an order or notice by the Tax Information Authority pursuant to the Tax Information Authority Act (2021 Revision) of the Cayman Islands, make available, in electronic form or any other medium, at its registered office copies of its books of account, or any part or parts thereof, as are specified in such order or notice.

3.9 Exchange control

There are no exchange control regulations or currency restrictions in effect in the Cayman Islands.

3.10 Taxation

Pursuant to section 6 of the Tax Concessions Act (2018 Revision) of the Cayman Islands, the Company has obtained an undertaking from the Governor-in-Cabinet that:

(a) no law which is enacted in the Cayman Islands imposing any tax to be levied on profits or income or gains or appreciations shall apply to the Company or its operations; and

(b) no tax be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax shall be payable by the Company:

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(i) on or in respect of the shares, debentures or other obligations of the Company; or

(ii) by way of withholding in whole or in part of any relevant payment as defined in section 6(3) of the Tax Concessions Act (2018 Revision).

The undertaking for the Company is for a period of 20 years from [●].

The Cayman Islands currently levy no taxes on individuals or corporations based upon profits, income, gains or appreciations and there is no taxation in the nature of inheritance tax or estate duty. There are no other taxes likely to be material to the Company levied by the Government of the Cayman Islands save for certain stamp duties which may be applicable, from time to time, on certain instruments.

3.11 Stamp duty on transfers

No stamp duty is payable in the Cayman Islands on transfers of shares of Cayman Islands companies save for those which hold interests in land in the Cayman Islands.

3.12 Loans to directors

There is no express provision prohibiting the making of loans by a company to any of its directors. However, the company’s articles of association may provide for the prohibition of such loans under specific circumstances.

3.13 Inspection of corporate records

The members of a company have no general right to inspect or obtain copies of the register of members or corporate records of the company. They will, however, have such rights as may be set out in the company’s articles of association.

3.14 Register of members

A Cayman Islands exempted company may maintain its principal register of members and any branch registers in any country or territory, whether within or outside the Cayman Islands, as the company may determine from time to time. There is no requirement for an exempted company to make any returns of members to the Registrar of

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Companies in the Cayman Islands. The names and addresses of the members are, accordingly, not a matter of public record and are not available for public inspection. However, an exempted company shall make available at its registered office, in electronic form or any other medium, such register of members, including any branch register of member, as may be required of it upon service of an order or notice by the Tax Information Authority pursuant to the Tax Information Authority Act (2021 Revision) of the Cayman Islands.

3.15 Register of directors and officers

Pursuant to the Cayman Companies Act, the Company is required to maintain at its registered office a register of directors, alternate directors and officers. The Registrar of Companies shall make available the list of the names of the current directors of the Company (and, where applicable, the current alternate directors of the Company) for inspection by any person upon payment of a fee by such person. A copy of the register of directors and officers must be filed with the Registrar of Companies in the Cayman Islands, and any change must be notified to the Registrar of Companies within 30 days of any change in such directors or officers, including a change of the name of such directors or officers.

3.16 Winding up

A Cayman Islands company may be wound up by: (i) an order of the court; (ii) voluntarily by its members; or (iii) under the supervision of the court.

The court has authority to order winding up in a number of specified circumstances including where, in the opinion of the court, it is just and equitable that such company be so wound up.

A voluntary winding up of a company (other than a limited duration company, for which specific rules apply) occurs where the company resolves by special resolution that it be wound up voluntarily or where the company in general meeting resolves that it be wound up voluntarily because it is unable to pay its debt as they fall due. In the case of a voluntary winding up, the company is obliged to cease to carry on its business from the commencement of its winding up except so far as it may be beneficial for its winding up. Upon appointment of a voluntary liquidator, all the powers of the directors cease, except so far as the company in general meeting or the liquidator sanctions their continuance.

In the case of a members’ voluntary winding up of a company, one or more liquidators are appointed for the purpose of winding up the affairs of the company and distributing its assets.

As soon as the affairs of a company are fully wound up, the liquidator must make a report and an account of the winding up, showing how the winding up has been conducted and the property of the company disposed of, and call a general meeting of the company for the purposes of laying before it the account and giving an explanation of that account.

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When a resolution has been passed by a company to wind up voluntarily, the liquidator or any contributory or creditor may apply to the court for an order for the continuation of the winding up under the supervision of the court, on the grounds that: (i) the company is or is likely to become insolvent; or (ii) the supervision of the court will facilitate a more effective, economic or expeditious liquidation of the company in the interests of the contributories and creditors. A supervision order takes effect for all purposes as if it was an order that the company be wound up by the court except that a commenced voluntary winding up and the prior actions of the voluntary liquidator shall be valid and binding upon the company and its official liquidator.

For the purpose of conducting the proceedings in winding up a company and assisting the court, one or more persons may be appointed to be called an official liquidator(s). The court may appoint to such office such person or persons, either provisionally or otherwise, as it thinks fit, and if more than one person is appointed to such office, the court shall declare whether any act required or authorised to be done by the official liquidator is to be done by all or any one or more of such persons. The court may also determine whether any and what security is to be given by an official liquidator on his appointment; if no official liquidator is appointed, or during any vacancy in such office, all the property of the company shall be in the custody of the court.

3.17 Reconstructions

Reconstructions and amalgamations may be approved by a majority in number representing 75 per cent in value of the members or creditors, depending on the circumstances, as are present at a meeting called for such purpose and thereafter sanctioned by the courts. Whilst a dissenting member has the right to express to the court his view that the transaction for which approval is being sought would not provide the members with a fair value for their shares, the courts are unlikely to disapprove the transaction on that ground alone in the absence of evidence of fraud or bad faith on behalf of management, and if the transaction were approved and consummated, the dissenting member would have no rights comparable to the appraisal rights (that is, the right to receive payment in cash for the judicially determined value of their shares) ordinarily available, for example, to dissenting members of a United States corporation.

3.18 Take-overs

Where an offer is made by a company for the shares of another company and, within four months of the offer, the holders of not less than 90 per cent of the shares which are the subject of the offer accept, the offeror may, at any time within two months after the expiration of that four-month period, by notice require the dissenting members to transfer their shares on the terms of the offer. A dissenting member may apply to the Cayman Islands courts within one month of the notice objecting to the transfer. The burden is on the dissenting member to show that the court should exercise its discretion, which it will be unlikely to do unless there is evidence of fraud or bad faith or collusion as between the offeror and the holders of the shares who have accepted the offer as a means of unfairly forcing out minority members.

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3.19 Indemnification

The Cayman Islands laws do not limit the extent to which a company’s articles of association may provide for indemnification of officers and directors, save to the extent any such provision may be held by the court to be contrary to public policy, for example, where a provision purports to provide indemnification against the consequences of committing a crime.

3.20 Economic Substance

The Cayman Islands enacted the International Tax Co-operation (Economic Substance) Act (2021 Revision) together with the Guidance Notes published by the Cayman Islands Tax Information Authority from time to time. The Company is required to comply with the economic substance requirements from 1 July 2019 and make an annual report in the Cayman Islands as to whether or not it is carrying on any relevant activities and if it is, it must satisfy an economic substance test.

4. GENERAL

Harney Westwood & Riegels, the Company’s legal adviser on Cayman Islands law, have sent to the Company a letter of advice summarising certain aspects of the Cayman Companies Act. This letter, together with a copy of the Cayman Companies Act, is available for inspection as referred to in the paragraph headed “Documents Available for Inspection” in Appendix V to this document. Any person wishing to have a detailed summary of the Cayman Companies Act or advice on the differences between it and the laws of any jurisdiction with which he is more familiar is recommended to seek independent legal advice.

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A. FURTHER INFORMATION ABOUT OUR GROUP

1. Incorporation of our Company

Our Company was incorporated in the Cayman Islands under the Cayman Islands Companies Act as an exempted company with limited liability on 1 February 2021. Our Company has established its principal place of business in Room 1901, 19/F, Lee Garden One, 33 Hysan Avenue, Causeway Bay, Hong Kong, and was registered with the Registrar of Companies in Hong Kong as a non-Hong Kong company under Part 16 of the Companies Ordinance on [●] 2021. Ms. Chan Lok Yee has been appointed as the authorised representative of our Company for the acceptance of service of process and notices on behalf of our Company in Hong Kong.

As our Company was incorporated in the Cayman Islands, we are subject to the Cayman Islands Companies Act, the Memorandum and the Articles. A summary of certain provisions of the Memorandum and Articles and relevant aspects of the Cayman Islands Companies Act is set out in the section headed “Summary of the Constitution of the Company and Cayman Islands Companies Law” in Appendix III to this document.

2. Changes in the share capital of our Company

As at the date of incorporation of our Company, the authorised share capital of our Company was HK$380,000 divided into 38,000,000 Shares of HK$0.01 par value each. Upon its incorporation, one fully-paid Share was allotted and issued to the initial subscriber, an Independent Third Party. On 4 February 2021, the one Share was transferred at par to WC-Holding, a BVI company indirectly owned as to 55% by Mr. Wong and 45% by Ms. Chan through WC-BVI, following which 59 Shares were allotted and issued to WC-Holding. On the same date, 16 Shares, 16 Shares, four Shares and four Shares were allotted and issued to RH International Investment Limited, RH Rising Investment Limited, Wong-Holding and Chan-Holding, respectively. RH International Investment Limited is indirectly wholly-owned by Ms. Wong Tan Ching through Ronghui Wise Investment Limited. RH Rising Investment Limited is indirectly wholly-owned by Mr. Wong Wai Lam through Ronghui Rising Limited. Wong-Holding is indirectly wholly-owned by Mr. Wong through Wong-BVI. Chan-Holding is indirectly wholly-owned by Ms. Chan through Chan-BVI. Upon completion of such allotment and issuance, our Company became owned as to 60% by WC-Holding, 16% by each of RH International Investment Limited and RH Rising Investment Limited, and 4% by each of Wong-Holding and Chan-Holding.

On 27 May 2021, each of RH International Investment Limited and RH Rising Investment Limited surrendered 16 fully-paid Shares and 16 fully-paid Shares, respectively, for nil consideration. The surrendered Shares were immediately cancelled by our Company. As a result, our Company became owned as to approximately 88.2% by WC-Holding and 5.9% by each of Wong-Holding and Chan-Holding.

On 3 June 2021, 259 Shares and 245 Shares were allotted and issued at par to CZ-BVI and Cheng-BVI respectively. On the same date, 1,596 Shares were allotted and issued to Wong-Holding at a subscription amount of HK$12.2 million, and 6,236 Shares and 1,596 Shares were allotted and issued to WC-Holding and Chan-Holding at par, respectively. Upon completion of such allotment and issuance, our Company became owned as to

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62.96% by WC-Holding, 16.00% by each of Wong-Holding and Chan-Holding, 2.59% by CZ-BVI and 2.45% by Cheng-BVI.

Pursuant to the written resolutions of the Shareholders passed on [●] 2021, our authorised share capital was increased from 38,000,000 to [1,000,000,000] by the creation of additional [962,000,000] Shares.

Immediately following completion of the Capitalisation Issue and the [REDACTED] and without taking into account any Shares which may be issued upon the exercise of the [REDACTED] or any options that may be granted under the Share Option Scheme, the issued share capital of our Company will be HK$[REDACTED] divided into [REDACTED] Shares, all fully paid or credited as fully paid, and [REDACTED] Shares will remain unissued.

Save as disclosed above and as mentioned in the paragraph headed “—4. Written resolutions of our Shareholders passed on [●] 2021” below, there has been no alteration in the share capital of our Company since its incorporation.

3. Changes in the share capital or the registered capital of our subsidiaries

Our subsidiaries are set out in the Accountant’s Report, the text of which is set out in Appendix I to this document.

Save as disclosed in the section headed “History, Reorganisation and Corporate Structure” in this document, there has been no alteration in the share capital of our subsidiaries during the two years preceding the date of this document.

4. Written resolutions of our Shareholders passed on [●] 2021

Pursuant to the written resolutions passed by our Shareholders on [●] 2021, among other matters:

(a) we approved and conditionally adopted the Memorandum and the Articles which will become effective upon [REDACTED];

(b) the authorised share capital of our Company was increased from 38,000,000 Shares to [1,000,000,000] Shares by the creation of an additional [962,000,000] Shares;

(c) conditional on (aa) the Stock Exchange granting the approval for the [REDACTED] of, and permission to deal in, the Shares in issue and Shares to be allotted and issued pursuant to the Capitalisation Issue, the [REDACTED] and as mentioned in this document including the Shares which may be allotted and issued pursuant to the exercise of the [REDACTED]orany options that may be granted under the Share Option Scheme; (bb) the [REDACTED] having been duly determined; and (cc) the obligations of the [REDACTED] under the [REDACTED] becoming unconditional and not being terminated in accordance with the terms of such agreement (or any conditions as specified in this document), in each case on or before the dates and times specified in the [REDACTED]:

(i) the [REDACTED] was approved and our Directors were authorised to approve the allotment and issue the [REDACTED] pursuant to the [REDACTED];

(ii) the [REDACTED] was approved and our Directors were authorised to allot and issue Shares upon the exercise of the [REDACTED];

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(iii) the rules of the Share Option Scheme, the principal terms of which are set out the paragraph headed “—D. Share Option Scheme” below, were approved and adopted and our Directors were authorised, at their absolute discretion, to grant options to subscribe for Shares thereunder and to allot, issue and deal with Shares pursuant to the exercise of options granted under the Share Option Scheme;

(iv) conditional on the share premium account of our Company being credited as a result of the [REDACTED], our Directors were authorised to capitalise the sum of HK$[REDACTED] standing to the credit of the share premium account of our Company by applying such sum in paying up in full at par [REDACTED] Shares for allotment and issue to holders of Shares whose names appear on the register of members of our Company on the date of passing this resolution in proportion (as near as possible without involving fractions so that no fraction of a share shall be allotted and issued) to their then existing respective shareholdings in our Company;

(v) a general unconditional mandate was given to our Directors to allot, issue and deal with (including the power to make an offer or agreement, or grant securities which would or might require Shares to be allotted and issue), otherwise than pursuant to a rights issue or pursuant to any scrip dividend schemes or similar arrangements providing for the allotment and issue of Shares in lieu of the whole or part of a dividend on Shares in accordance with the Articles or pursuant to a specific authority granted by the Shareholders in general meeting, unissued Shares not exceeding the aggregate of 20% of the number of issued Shares immediately following the completion of the Capitalisation Issue and [REDACTED] (but taking no account of any Shares which may be allotted and issued pursuant to the exercise of the [REDACTED]orany options that may be granted under the Share Option Scheme), such mandate to remain in effect until the conclusion of the next annual general meeting of our Company, or the expiration of the period within which the next annual general meeting of our Company is required by the Articles or any applicable laws to be held, or until revoked or varied by an ordinary resolution of our Shareholders in general meeting, whichever occurs first;

(vi) a general unconditional mandate was given to our Directors authorising them to exercise all powers of our Company to buy back on the Stock Exchange or on any other approved stock exchange on which the securities of our Company may be [REDACTED] and which is recognised by the SFC and the Stock Exchange for this purpose such number of Shares as will represent up to 10% of the number of issued Shares immediately following the completion of the Capitalisation Issue and the [REDACTED] (but taking no account of any Shares which may be allotted and issued pursuant to the exercise of the [REDACTED]or any options that may be granted under the Share Option Scheme), such mandate to remain in effect until the conclusion of the next annual general meeting of our Company, or the expiration of the period within which the next annual general meeting of our Company is required by

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the Articles or any applicable laws to be held, or until revoked or varied by an ordinary resolution of our Shareholders in general meeting, whichever occurs first; and

(vii) the general unconditional mandate mentioned in paragraph (iv) above was extended by the addition to the number of issued Shares which may be allotted and issued or agreed conditionally or unconditionally to be allotted and issued by our Directors pursuant to such general mandate of an amount representing the total number of issued Shares bought back by our Company pursuant to the mandate to buy back Shares referred to in paragraph (v) above.

5. Reorganisation

In preparation for the [REDACTED], the companies comprising our Group underwent the Reorganisation and our Company became the holding company of our Group. For further details with regard to the Reorganisation, see the section headed “History, Reorganisation and Corporate Structure” in this document.

6. Buyback by our Company of our own securities

This section includes information required by the Stock Exchange to be included in this document concerning the buyback by our Company of our own securities.

(a) Provisions of the Listing Rules

The Listing Rules permit companies with a primary [REDACTED]onthe Stock Exchange to purchase their shares on the Stock Exchange subject to certain restrictions.

(i) Shareholders’ approval

The Listing Rules provide that all proposed buybacks of shares (which must be fully paid in the case of shares) by a company with a primary listing on the Stock Exchange must be approved in advance by an ordinary resolution of its shareholders in general meeting, either by way of general mandate or by specific approval of a particular transaction.

Note: Pursuant to the written resolutions passed by our Shareholders on [●] 2021, a general unconditional mandate (the “Buyback Mandate”) was granted to our Directors authorising the buyback of shares by our Company on the Stock Exchange, or on any other stock exchange on which the securities of our Company may be [REDACTED] and which is recognised by the SFC and the Stock Exchange for this purpose, with the total number of Shares not exceeding 10% of the total number of Shares in issue and to be issued as mentioned herein, at any time until the conclusion of the next annual general meeting of our Company, the expiration of the period within which the next annual general meeting of our Company is required by an applicable law or the Articles to be held or when such mandate is revoked or varied by an ordinary resolution of our Shareholders in general meeting, whichever is the earliest.

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(ii) Source of funds

Buybacks must be funded out of funds legally available for the purpose in accordance with the Memorandum and the Articles and the Cayman Islands Companies Act. A [REDACTED] company may not buyback its own shares on the Stock Exchange for a consideration other than cash or for settlement otherwise than in accordance with the trading rules of the Stock Exchange from time to time.

(iii) Core connected persons

The Listing Rules prohibit our Company from knowingly repurchasing the Shares on the Stock Exchange from a “core connected person”, which includes a director, chief executive or substantial shareholder of our Company or any of the subsidiaries or a close associate of any of them and a core connected person shall not knowingly sell Shares to our Company.

(b) Reasons for buybacks

Our Directors believe that it is in the best interests of our Company and our Shareholders as a whole for our Directors to have a general authority from our Shareholders to enable our Company to buy back Shares in the market. Such buybacks may, depending on the market conditions and funding arrangements at the time, lead to an enhancement of our Company’s net asset value per Share and/or earnings per Share and will only be made when our Directors believe that such buybacks will benefit our Company and our Shareholders.

In buying back Shares, our Company may only apply funds legally available for such purpose in accordance with our Memorandum and Articles, the Listing Rules and the applicable laws of the Cayman Islands.

As a matter of Cayman law, any purchases by our Company may be made out of profits or out of the proceeds of a new issue of shares made for the purpose of the purchase or from sums standing to the credit of our share premium account or out of capital, if so authorised by the Articles and subject to the Companies Act. Any premium payable on the purchase over the par value of the shares to be purchased must have been provided for out of profits or from sums standing to the credit of our share premium account or out of capital, if so authorised by the Articles and subject to the Companies Act.

On the basis of the current financial position of our Group as disclosed in this document and taking into account the current working capital position of our Company, our Directors consider that, if the Buyback Mandate were to be exercised in full, it might have a material adverse effect on the working capital and/or the gearing position of our Group as compared to the position disclosed in

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this document. However, our Directors do not propose to exercise the Buyback Mandate to such an extent as would, in the circumstances, have a material adverse effect on the working capital or the gearing levels of our Group which in the opinion of our Directors are from time to time appropriate for our Group.

(d) Share capital

The exercise in full of the Buyback Mandate, on the basis of [REDACTED] Shares in issue immediately after the [REDACTED] (but not taking into account of our Shares which may be issued pursuant to the exercise of the [REDACTED]orany options that may be granted under the Share Option Scheme), would result in up to [REDACTED] Shares being bought back by our Company during the period until:

(i) the conclusion of the next annual general meeting of our Company;

(ii) the expiration of the period within which the next annual general meeting of our Company is required by any applicable law or the Articles to be held; or

(iii) the date on which the Buyback Mandate is revoked or varied by an ordinary resolution of our Shareholders in general meeting, whichever occurs first.

(e) General

None of our Directors nor, to the best of their knowledge having made all reasonable enquiries, any of their close associates (as defined in the Listing Rules), has any present intention if the Buyback Mandate is exercised to sell any Share(s) to our Company or our subsidiaries.

Our Directors have undertaken to the Stock Exchange that, so far as the same may be applicable, they will exercise the Buyback Mandate in accordance with the Listing Rules and the applicable laws of the Cayman Islands.

If as a result of a buyback of Shares pursuant to the Buyback Mandate, a Shareholder’s proportionate interest in the voting rights of our Company increases, such increase will be treated as an acquisition for the purposes of the Takeovers Code. Accordingly, a Shareholder or a group of Shareholders acting in concert, depending on the level of increase of the Shareholders’ interest, could obtain or consolidate control of our Company and may become obliged to make a mandatory offer in accordance with Rule 26 of the Takeovers Code as a result of any such increase. Save as disclosed above, our Directors are not aware of any consequence that would arise under the Takeovers Code as a result of a buyback pursuant to the Buyback Mandate.

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If the Buyback Mandate is fully exercised immediately following completion of the Capitalisation Issue and the [REDACTED] (but not taking into account our Shares which may be issued pursuant to the exercise of the [REDACTED]orany option which may be granted under the Share Option Scheme), the total number of Shares which will be bought back pursuant to the Buyback Mandate will be [REDACTED] Shares, being 10% of the total number of Shares based on the aforesaid assumptions. Any buyback of Shares which results in the number of Shares held by the public being reduced to less than the prescribed percentage of our Shares then in issue could only be implemented with the approval of the Stock Exchange to waive the Listing Rules requirements regarding the public float under Rule 8.08 of the Listing Rules. However, our Directors have no present intention to exercise the Repurchase Mandate to such an extent that, in the circumstances, there is insufficient public float as prescribed under the Listing Rules.

No core connected person of our Company has notified our Group that he/she/it has a present intention to sell Shares to our Company, or has undertaken not to do so, if the Buyback Mandate is exercised.

B. FURTHER INFORMATION ABOUT OUR BUSINESS

1. Summary of material contracts

The following contracts (not being contracts in the ordinary course of business) have been entered into by members of our Group within the two years preceding the date of this document and are or may be material:

(a) an equity interest transfer agreement dated 29 March 2021 entered into between Chongqing Ronghui Industrial Co., Ltd. (重慶融匯實業有限公司) and Chongqing Ronghui Youjia Smart Life Services Co., Ltd. (重慶融匯優家智慧生活服務有限公司) in respect of the transfer of 100% equity interest in Chongqing Ronghui Property Management Co., Ltd. (重慶融匯物業管理有限公司) from Chongqing Ronghui Industrial Co., Ltd. (重慶融匯實業有限公司)to Chongqing Ronghui Youjia Smart Life Services Co., Ltd. (重慶融匯優家智慧生活服務有限公司) at a consideration of RMB10,000,000;

(b) an equity interest transfer agreement dated 29 March 2021 entered into between Chongqing Ronghui Industrial Co., Ltd. (重慶融匯實業有限公司) and Chongqing Ronghui Guanling Commercial Real Estate Operation Management Co., Ltd. (重慶融匯冠嶺商業地產營運管理有限公司) in respect of the transfer of 100% equity interest in Chongqing Ronghui Commercial Management Co., Ltd. (重慶融匯商業管理有限公司) from Chongqing Ronghui Industrial Co., Ltd. (重慶融匯實業有限公司) to Chongqing Ronghui Guanling Commercial Real Estate Operation Management Co., Ltd. (重慶融匯冠嶺商業地產營運管理有限公司) at a consideration of RMB10,000,000;

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(c) an equity interest transfer agreement dated 29 March 2021 entered into between Chongqing Ronghui Hot Spring Industry Development Co., Ltd. (重慶融匯溫泉產業發展有限公司) and Chongqing Ronghui Youjia Smart Life Services Co., Ltd. (重慶融匯優家智慧生活服務有限公司) in respect of the transfer of 0.12% equity interest in Chongqing Ronghui Guanling Commercial Real Estate Operation Management Co., Ltd. (重慶融匯冠嶺商業地產營運管理有限公司) from Chongqing Ronghui Hot Spring Industry Development Co., Ltd. (重慶融匯溫泉產業發展有限公司) to Chongqing Ronghui Youjia Smart Life Services Co., Ltd. (重慶融匯優家智慧生活服務有限公司) at a consideration of RMB24,000;

(d) an equity interest transfer agreement dated 29 March 2021 entered into between Chongqing Ronghui Real Estate (Group) Co., Ltd. (重慶融匯地產（集團）有限公司) and Chongqing Ronghui Youjia Smart Life Services Co., Ltd. (重慶融匯優家智慧生活服務有限公司) in respect of the transfer of 87.50% equity interest in Chongqing Ronghui Guanling Commercial Real Estate Operation Management Co., Ltd. (重慶融匯冠嶺商業地產營運管理有限公司) from Chongqing Ronghui Real Estate (Group) Co., Ltd. (重慶融匯地產（集團）有限公司) to Chongqing Ronghui Youjia Smart Life Services Co., Ltd. (重慶融匯優家智慧生活服務有限公司) at a consideration of RMB17,500,000;

(e) an equity interest transfer agreement dated 29 March 2021 entered into between Chongqing Ronghui Investment Co., Ltd. (重慶融匯投資有限公司) and Chongqing Ronghui Youjia Smart Life Services Co., Ltd. (重慶融匯優家智慧生活服務有限公司) in respect of the transfer of 12.38% equity interest in Chongqing Ronghui Guanling Commercial Real Estate Operation Management Co., Ltd. (重慶融匯冠嶺商業地產營運管理有限公司)from Chongqing Ronghui Investment Co., Ltd. (重慶融匯投資有限公司)to Chongqing Ronghui Youjia Smart Life Services Co., Ltd. (重慶融匯優家智慧生活服務有限公司) at a consideration of RMB2,476,000;

(f) an equity interest transfer agreement dated 29 March 2021 entered into between Ms. Huang Fengqin (黃鳳琴) and Chongqing Ronghui Guanling Commercial Real Estate Operation Management Co., Ltd. (重慶融匯冠嶺商業地產營運管理有限公司) in respect of the transfer of 1% equity interest in Fuzhou Ronghui Real Estate Co., Ltd. (福州融匯置業有限公司)fromMs. Huang Fengqin (黃鳳琴) to Chongqing Ronghui Guanling Commercial Real Estate Operation Management Co., Ltd. (重慶融匯冠嶺商業地產營運管理有限公司) at a consideration of RMB30,000;

(g) an equity interest transfer agreement dated 29 March 2021 entered into between Mr. Pei Luyang (裴路陽) and Chongqing Ronghui Guanling Commercial Real Estate Operation Management Co., Ltd. (重慶融匯冠嶺商業地產營運管理有限公司) in respect of the transfer of 99% equity interest in Fuzhou Ronghui Real Estate Co., Ltd. (福州融匯置業有限公司)fromMr.Pei Luyang (裴路陽) to Chongqing Ronghui Guanling Commercial Real Estate

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Operation Management Co., Ltd. (重慶融匯冠嶺商業地產營運管理有限公司)at a consideration of RMB2,970,000;

(h) an equity interest transfer agreement dated 29 March 2021 entered into between Ronghui (Fujian) Group Co., Ltd. (融匯（福建）集團有限公司) and Chongqing Ronghui Property Management Co., Ltd. (重慶融匯物業管理有限公司) in respect of the transfer of 95% equity interest in Fujian Ronghui Property Management Co., Ltd. (福建融匯物業管理有限公司) from Ronghui (Fujian) Group Co., Ltd. (融匯（福建）集團有限公司) to Chongqing Ronghui Property Management Co., Ltd. (重慶融匯物業管理有限公司) at a consideration of RMB4,750,000;

(i) an equity interest transfer agreement dated 29 March 2021 entered into between Ronghui (Fujian) Industry Development Co., Ltd. (融匯（福建）實業發展有限公司) and Chongqing Ronghui Property Management Co., Ltd. (重慶融匯物業管理有限公司) in respect of the transfer of 5% equity interest in Fujian Ronghui Property Management Co., Ltd. (福建融匯物業管理有限公司)from Ronghui (Fujian) Industry Development Co., Ltd. (融匯（福建）實業發展有限公司) to Chongqing Ronghui Property Management Co., Ltd. (重慶融匯物業管理有限公司) at a consideration of RMB250,000;

(j) an equity interest transfer agreement dated 6 April 2021 entered into between Shandong Ronghui Real Estate Co., Ltd. (山東融匯房地產有限公司) and Chongqing Ronghui Guanling Commercial Real Estate Operation Management Co., Ltd. (重慶融匯冠嶺商業地產營運管理有限公司) in respect of the transfer of 100% equity interest in Shandong Ronghui Laoshangbu Commercial Operation Management Co., Ltd. (山東融匯老商埠商業運營管理有限公司) from Shandong Ronghui Real Estate Co., Ltd. (山東融匯房地產有限公司) to Chongqing Ronghui Guanling Commercial Real Estate Operation Management Co., Ltd. (重慶融匯冠嶺商業地產營運管理有限公司)ata consideration of RMB5,000,000;

(k) an equity interest transfer agreement dated 6 April 2021 entered into between Shandong Ronghui Properties Co., Ltd. (山東融匯置業有限公司) and Chongqing Ronghui Guanling Commercial Real Estate Operation Management Co., Ltd. (重慶融匯冠嶺商業地產營運管理有限公司) in respect of the transfer of 100% equity interest in Shandong Ronghui Creative Cultural Industry Co., Ltd. (山東融匯創意文化產業有限公司) from Shandong Ronghui Properties Co., Ltd. (山東融匯置業有限公司) to Chongqing Ronghui Guanling Commercial Real Estate Operation Management Co., Ltd. (重慶融匯冠嶺商業地產營運管理有限公司) at a consideration of RMB10,000,000;

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(l) an equity interest transfer agreement dated 20 April 2021 entered into between Chongqing Botu Enterprise Management Consulting Co., Ltd. (重慶伯圖企業管理諮詢有限公司) and Chongqing Ronghui Jiayue Enterprise Management Co., Ltd. (重慶融匯家悅企業管理有限公司) in respect of the transfer of 0.5% equity interest in Chongqing Ronghui Youjia Smart Life Services Co., Ltd. (重慶融匯優家智慧生活服務有限公司) from Chongqing Botu Enterprise Management Consulting Co., Ltd. (重慶伯圖企業管理諮詢有限公司) to Chongqing Ronghui Jiayue Enterprise Management Co., Ltd. (重慶融匯家悅企業管理有限公司) at a consideration of RMB480,000;

(m) an equity interest transfer agreement dated 20 April 2021 entered into between Chongqing Ronghui Real Estate (Group) Co., Ltd. (重慶融匯地產（集團）有限公司) and Chongqing Ronghui Jiayue Enterprise Management Co., Ltd. (重慶融匯家悅企業管理有限公司) in respect of the transfer of 9.5% equity interest in Chongqing Ronghui Youjia Smart Life Services Co., Ltd. (重慶融匯優家智慧生活服務有限公司) from Chongqing Ronghui Real Estate (Group) Co., Ltd. (重慶融匯地產（集團）有限公司) to Chongqing Ronghui Jiayue Enterprise Management Co., Ltd. (重慶融匯家悅企業管理有限公司) at a consideration of RMB9,120,000;

(n) an equity interest transfer agreement dated 30 April 2021 entered into among Chongqing Ronghui Property Management Co., Ltd. (重慶融匯物業管理有限公司), Mr. Zhu Xiaopeng (朱小鵬), Mr. Wang Yi (王藝) and Chongqing Xintianyuan Property Management Co., Ltd. (重慶新天源物業管理有限公司)in respect of the transfer of 49% and 2% equity interest in Chongqing Xintianyuan Property Management Co., Ltd. (重慶新天源物業管理有限公司) from Mr. Zhu Xiaopeng (朱小鵬) and Mr. Wang Yi (王藝) to Chongqing Ronghui Property Management Co., Ltd. (重慶融匯物業管理有限公司)ata consideration of RMB9,800,000 and RMB400,000, respectively;

(o) the [Deed of Indemnity];

(p) the [Deed of Non-Competition];

(q) the [WTC Deed of Non-Competition];

(r) the [WWL Deed of Non-Competition]; and

(s) the [REDACTED].

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2. Intellectual property rights of our Group

(a) Trademarks

As at the Latest Practicable Date, our Group was the registered owner of the following trademark which, in the opinion of our Directors, is or may be material to our business: Registration Name of Place of Date of Date of No. Trademark Number Class Registered Owner Registration Registration Expiry

1.... 38077463 35 Chongqing Ronghui PRC 7 January 6 January PM 2020 2030

As at the Latest Practicable Date, our Group has applied for the registration of the following trademarks which, in the opinion of our Directors, are or may be material to our business: Name of Application Registered Place of Date of No. Trademark Number Class Owner Application Application

1.... 305558158 37 Our Company Hong Kong 10 March 2021

2.... 44963853 36 Chongqing PRC 27 March 2020 Ronghui PM

3..... 55245132 36 Ronghui PRC 15 April 2021 Guanling

(b) Copyright

As at the Latest Practicable Date, our Group has registered the following copyrights in the PRC which, in the opinion of our Directors, are or may be material to our business: No. Copyright Registration Number Copyright Owner Date of Registration Status

1.... Ronghui Property Xiaohui 2021SRE009078 Chongqing Ronghui 15 April 2021 Valid Dangjia Property Owner PM Services Management Software V2.0 (融匯物業小匯當家業主服務管理軟件 V2.0)

2.... Rong Xiaohai (融小嗨) 2020-F-00485997 Chongqing Ronghui 30 April 2020 Valid PM

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As at the Latest Practicable Date, our Group has registered the following domain names in the PRC which, in the opinion of our Directors, are or may be material to our business:

Name of Date of No. Domain name Registered Proprietor Registration Expiry Date

1 . . . rhjoylife.com Chongqing Ronghui PM 23 February 2021 23 February 2031

2.... rhjoylife.com.cn Chongqing Ronghui PM 23 February 2021 23 February 2031

C. FURTHER INFORMATION ABOUT OUR DIRECTORS AND SUBSTANTIAL SHAREHOLDERS

1. Directors

(a) Disclosure of Interests—Interests and short positions of the Directors and the chief executive of our Company in the Shares, underlying Shares and debentures of our Company and our associated corporations

Immediately following completion of the Capitalisation Issue and the [REDACTED] and assuming that the [REDACTED] or any option which may be granted under the Share Option Scheme is not exercised, the interests or short positions of Directors or chief executives of our Company will have interests or short positions in the shares, underlying shares and debentures of our Company or our 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, pursuant to section 352 of the SFO, to be entered in the register referred to therein, or which will be required, pursuant to the Model Code for Securities Transactions by Directors of [REDACTED] to be notified to our Company and the Stock Exchange once our Shares are [REDACTED] will be as follows:

Interest in our Company

Approximate Number of percentage of Name of Director Nature of Interest Shares held(1) shareholding

Mr. Chen Zhong(2) Interest in controlled corporation [REDACTED] (L) [REDACTED]%

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Notes:

(1) The letter “L” denotes the person’s long position in our Shares.

(2) CZ-BVI is wholly owned by Mr. Chen Zhong. Accordingly, Mr. Chen Zhong is deemed to be interested in the Shares held by CZ-BVI in our Company under the SFO.

(b) Particulars of service agreements and letters of appointment

Each of our executive Directors [has entered into] a service agreement with our Company for a term of [three years] commencing from the [REDACTED], which may be terminated by not less than three months’ notice in writing served by either party on the other.

Each of our non-executive Directors and independent non-executive Directors [has entered into] a letter of appointment with our Company for a term of [three years] commencing from the [REDACTED], which may be terminated by not less than three months’ notice in writing served by either party on the other.

For the years ended 31 December 2018, 2019 and 2020, the aggregate remuneration (including fees, salaries, contributions to pension schemes, bonus, retirement benefits scheme, allowance and other benefits in kind) paid to our Directors was approximately RMB0.36 million, RMB0.39 million and RMB0.46 million, respectively. For details, please refer to note 12 of the Accountant’s Report set out in Appendix I to this document.

Each of our independent non-executive Directors [has been] appointed for a term of three years. We intend to pay a director’s fee of RMB90,000 per annum to Ms. Chen Qingfang, and HK$120,000 per annum to each of Ms. Ng Chung Yan Linda and Ms. Leung Bo Yee Nancy. Save for directors’ fees, none of our independent non-executive Directors is expected to receive any other remuneration for holding their office as an independent non-executive Director.

Under the arrangement currently in force, the aggregate remuneration (including fees, salaries, bonus, share-based payments, contributions to retirement benefits scheme, allowances and other benefits in kind) of our Directors for the year ending 31 December 2021 is estimated to be no more than RMB1.39 million.

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2. Substantial shareholders

Save as disclosed in the section headed “Substantial Shareholders” in this document, our Directors are not aware of any person (other than our Directors or chief executive of our Company) who will, immediately following the completion of the Capitalisation Issue and the [REDACTED] assuming that the [REDACTED] or any option which may be granted under the Share Option Scheme is not exercised, have or be deemed or taken to have an interest and/or short position in our Shares or the underlying Shares which would fall to be disclosed under the provisions of Division 2 and 3 of Part XV of the SFO, or who will be, directly or indirectly, interested in 10% or more of the issued voting shares of any member of our Group.

3. Agency fees or commissions received

Save as disclosed in “[REDACTED]” in this document, no commissions, discounts, brokerages or other special terms were granted 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. Disclaimers

Save as disclosed in this document,

(a) none of our Directors or chief executive of our Company has any interest or short position in our shares, underlying shares or debentures of our Company or any of its A1A45(2) associated corporation (within the meaning of the SFO) which will have to be notified to our Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO or which will be required, pursuant to section 352 of the SFO, to be entered in the register referred to therein, or which will be required to be notified to our Company and the Stock Exchange pursuant to the Model Code for Securities Transactions by Directors of [REDACTED] once our Shares are [REDACTED];

(b) none of our Directors or experts referred to under the paragraph headed “—E. Other Information—8. Qualifications and consents of experts” below has any direct or indirect interest in the promotion of our Company, or in any assets which have within the two years immediately preceding the date of this document 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;

(c) none of our Directors 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 taken as a whole;

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(d) none of our Directors has any existing or proposed service contracts with any member of our Group (excluding contracts expiring or determinable by the employer within one year without payment of compensation (other than statutory compensation));

(e) taking no account of Shares which may be taken up under the [REDACTED], none of our Directors knows of any person (not being a Director or chief executive of our Company) who will, immediately following completion of the [REDACTED], have an interest or short position in our Shares or underlying Shares of our Company which would fall to be disclosed to our Company under the provisions of Divisions 2 and 3 of Part XV of SFO or be interested, directly or indirectly, in 10% or more of the issued voting shares of any member of our Group;

(f) none of the experts referred to under the paragraph headed “—E. Other Information—8. Qualifications and consents of experts” below has any shareholding in any member of our Group or the right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of our Group;

(g) so far as is known to our Directors, as at the Latest Practicable Date, none of our Directors, their respective close associates (as defined under the Listing Rules) or Shareholders of our Company who are interested in more than 5% of the total number of issued Shares has any interests in the five largest customers or the five largest suppliers of our Group.

D. SHARE OPTION SCHEME

The following is a summary of the principal terms of the Share Option Scheme conditionally adopted by the written resolutions of our Shareholders passed on [●], 2021.

(a) Purpose

The Share Option Scheme is a share incentive scheme prepared in accordance with Chapter 17 of the Listing Rules and is established to recognise and acknowledge the contributions that the Eligible Participants (as defined in paragraph (b) below) had or may have made to our Group. The Share Option Scheme will provide the Eligible Participants an opportunity to have a personal stake in our Company with the view to achieving the following objectives:

(i) motivate the Eligible Participants to optimise their performance efficiency for the benefit of our Group; and

(ii) attract and retain or otherwise maintain an on-going business relationship with the Eligible Participants whose contributions are or will be beneficial to the long-term growth of our Group.

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(b) Who may join

The Board may, at its discretion, offer to grant an option to the following persons (collectively the “Eligible Participants”) to subscribe for such number of new Shares as the Board may determine at an exercise price determined in accordance with paragraph (f) below:

(i) any full-time or part-time employees, executives or officers of our Company or any of our subsidiaries;

(ii) any directors (including non-executive directors and independent non-executive directors) of our Company or any of our subsidiaries; and

(iii) any advisors, consultants, suppliers, customers, distributors and such other persons who, in the sole opinion of the Board will contribute or have contributed to our Company or any of our subsidiaries.

Upon acceptance of the option, the grantee shall pay HK$1.00 to our Company by way of consideration for the grant.

An option shall be deemed to have been granted and accepted by the grantee and to have taken effect when the duplicate offer document constituting acceptances of the options duly signed by the grantee, together with a remittance or payment in favour of our Company of HK$1.00 by way of consideration for the grant thereof, is received by our Company on or before the relevant acceptance date. Such remittance or payment shall in no circumstances be refundable. Any offer to grant an option to subscribe for Shares may be accepted in respect of less than the number of Shares for which it is offered provided that it is accepted in respect of a board lot for dealing in Shares on the Stock Exchange or an integral multiple thereof and such number is clearly stated in the duplicate offer document constituting acceptance of the option. To the extent that the offer to grant an option is not accepted by any prescribed acceptance date, it shall be deemed to have been irrevocably declined.

Subject to paragraphs (l), (m), (n), (o) and (p), an Option shall be exercised in whole or in part and, other than where it is exercised to the full extent outstanding, shall be exercised in integral multiples of such number of Shares as shall represent one board lot for dealing in Shares on the Stock Exchange for the time being, by the grantee by giving notice in writing to our Company stating that the option is thereby exercised and the number of Shares in respect of which it is exercised. Each such notice must be accompanied by a remittance or payment for the full amount of the exercise price for our Shares in respect of which the notice is given. Within 21 days after receipt of the notice and the remittance or payment and, where appropriate, receipt of the certificate by the auditors to our Company or the approved independent financial advisor as the case may

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be pursuant to paragraph (r), our Company shall allot and issue the relevant number of Shares to the grantee credited as fully paid and issue to the grantee certificates in respect of our Shares so allotted.

The exercise of any option shall be subject to our Shareholders in general meeting approving any necessary increase in the authorised share capital of our Company.

(d) Maximum number of Shares

The maximum number of Shares in respect of which options may be granted under the Share Option Scheme and under any other share option schemes of our Company must not in aggregate exceed 10% of the total number of Shares in issue immediately following completion of the [REDACTED], being [REDACTED] Shares (excluding any Shares which may be issued pursuant to the exercise of the [REDACTED]), excluding for this purpose Shares which would have been issuable pursuant to options which have lapsed in accordance with the terms of the Share Option Scheme (or any other share option schemes of our Company). Subject to the issue of a circular by our Company and the approval of our Shareholders in general meeting in compliance with Rules 17.03(3) and 17.06 of the Listing Rules and/or such other requirements prescribed under the Listing Rules from time to time, the Board may:

(i) renew this limit at any time to 10% of our Shares in issue as at the date of the approval by our Shareholders in general meeting; and/or

(ii) grant options beyond the 10% limit to Eligible Participants specifically identified by the Board. The circular to be issued by our Company to our Shareholders shall contain a generic description of the specified Eligible Participants who may be granted such options, the number and terms of the options to be granted, the purpose of granting options to the specified Eligible Participants with an explanation as to how the options serve such purpose, the information required under Rule 17.02(2)(d) of the Listing Rules and the disclaimer required under Rule 17.02(4) of the Listing Rules.

Notwithstanding the foregoing and subject to paragraph (r) below, the maximum number of Shares which may be issued upon exercise of all outstanding options granted and yet to be exercised under the Share Option Scheme and any other share option schemes of our Company at any time shall not exceed 30% of our Shares in issue from time to time. No options shall be granted under any schemes of our Company (including the Share Option Scheme) if this will result in the 30% limit being exceeded. The maximum number of Shares in respect of which options may be granted shall be adjusted, in such manner as the auditors of our Company or an approved independent financial advisor shall certify to be appropriate, fair and reasonable in the event of any alteration in the capital structure of our Company in accordance with paragraph (r) below whether by way of capitalisation issue, rights issue, sub-division or consolidation of shares or reduction of share capital of our Company but in no event shall exceed the limit prescribed in this paragraph.

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(e) Maximum number of options to any one individual

The total number of Shares issued and which may fall to be issued upon exercise of the options granted under the Share Option Scheme and any other share option schemes of our Company (including both exercised and outstanding options) to each Eligible Participant in any 12-month period up to the date of grant shall not exceed 1% of our Shares in issue as at the date of grant. Any further grant of options in excess of this 1% limit shall be subject to:

(i) the issue of a circular by our Company to our Shareholders which shall comply with Rules 17.03(4) and 17.06 of the Listing Rules and/or such other requirements as prescribed under the Listing Rules from time to time. The circular to be issued by our Company shall contain the identity of the Eligible Participant, the numbers of and terms of the options to be granted (and options previously granted to such participant), the information as required under Rule 17.02(2)(d) of the Listing Rules and the disclaimer required under 17.02(4) of the Listing Rules; and

(ii) the approval of our Shareholders in general meeting and/or other requirements prescribed under the Listing Rules from time to time with such Eligible Participant and his close associates (as defined in the Listing Rules (or his associates (as defined in the Listing Rules) if the Eligible participant is a connected person (as defined in the Listing Rules))) abstaining from voting. The numbers and terms (including the exercise price) of options to be granted to such participant must be fixed before our Shareholders’ approval and the date of the Board meeting at which the Board proposes to grant the options to such Eligible Participant shall be taken as the date of grant for the purpose of calculating the subscription price of our Shares. The Board shall forward to such Eligible Participant an offer document in such form as the Board may from time to time determine (or, alternatively, documents accompanying the offer document which state), among others:

(aa) the Eligible Participant’s name, address and occupation;

(bb) the date on which an Option is offered to an Eligible Participant which must be a date on which the Stock Exchange is open for the business of dealing in securities;

(cc) the date upon which an offer for an option must be accepted;

(dd) the date upon which an option is deemed to be granted and accepted in accordance with paragraph (c);

(ee) the number of Shares in respect of which the option is offered;

(ff) the subscription price and the manner of payment of such price for our Shares on and in consequence of the exercise of the option;

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(gg) the date of the expiry of the option as may be determined by the Board;

(hh) the method of acceptance of the Option which shall, unless the Board otherwise determines, be as set out in paragraph (c); and

(ii) such other terms and conditions (including, without limitation, any minimum period for which an option must be held before it can be exercised and/or any performance targets which must be achieved before the option can be exercised) relating to the offer of the option which in the opinion of the Board are fair and reasonable but not being inconsistent with the Share Option Scheme and the Listing Rules.

(f) Price of Shares

Subject to any adjustments made as described in paragraph (r) below, the subscription price of a Share in respect of any particular option granted under the Share Option Scheme shall be such price as the Board in its absolute discretion shall determine, save that such price must be at least the higher of:

(i) the official closing price of our Shares as stated in the Stock Exchange’s daily quotation sheets on the date of grant, which must be a day on which the Stock Exchange is open for the business of dealing in securities;

(ii) the average of the official closing prices of our Shares as stated in the Stock Exchange’s daily quotation sheets for the five business days immediately preceding the date of grant; and

(iii) the nominal value of a Share.

(g) Granting options to a director, chief executive or substantial shareholder of our Company or any of their respective associates

Any grant of options to a director, chief executive or substantial shareholder (as defined in the Listing Rules) of our Company or any of their respective associates (as defined in the Listing Rules) is required to be approved by the independent non-executive Directors (excluding any independent non-executive Director who is the grantee of the options). If the Board proposes to grant options to a substantial shareholder or any independent non-executive Director or their respective associates (as defined in the Listing Rules) which will result in the number of Shares issued and to be issued upon exercise of options granted and to be granted (including options exercised, cancelled and outstanding) to such person in the 12-month period up to and including the date of such grant:

(i) representing in aggregate over 0.1% or such other percentage as may be from time to time provided under the Listing Rules of our Shares in issue on the date of offer of the option; and

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(ii) having an aggregate value, based on the official closing price of our Shares as stated in the daily quotation sheets of the Stock Exchange on the date of such grant, in excess of HK$5 million or such other sum as may be from time to time provided under the Listing Rules,

such further grant of options will be subject to the issue of a circular by our Company and the approval of our Shareholders in general meeting on a poll at which the grantee, his/her associates and all core connected persons (as defined in the Listing Rules) of our Company shall abstain from voting in favour, and/or such other requirements prescribed under the Listing Rules from time to time. Any vote taken at the meeting to approve the grant of such options shall be taken as a poll.

The circular to be issued by our Company to our Shareholders pursuant to the above paragraph shall contain the following information:

(i) the details of the number and terms (including the exercise price) of the options to be granted to each selected Eligible Participant which must be fixed before our Shareholders’ meeting and the date of Board meeting for proposing such further grant shall be taken as the date of grant for the purpose of calculating the exercise price of such options;

(ii) a recommendation from the independent non-executive Directors (excluding any independent non-executive Director who is the grantee of the options) to the independent Shareholders as to voting;

(iii) the information required under Rule 17.02(2)(c) and (d) of the Listing Rules and the disclaimer required under Rule 17.02(4) of the Listing Rules; and

(iv) the information required under Rule 2.17 of the Listing Rules.

(h) Restrictions on the times of grant of options

A grant of options may not be made after inside information has come to the knowledge of our Company until it has announced such inside information pursuant to the requirements of the Listing Rules and the Inside Information Provisions of Part XIVA of the SFO. In particular, no options may be granted during the period commencing one month immediately preceding the earlier of:

(i) the date of the Board meeting (as such date to first notified to the Stock Exchange in accordance with the Listing Rules) for the approval of our annual results or our results for half-year, quarterly or other interim period (whether or not required under the Listing Rules); and

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(ii) the deadline for our Company to publish an announcement of our annual results or our results for half-year, quarterly or other interim period (whether or not required under the Listing Rules), and ending on the date of actual publication of the results for such year, half year, quarterly or interim period (as the case may be),

and where an option is granted to a Director notwithstanding the above:

(iii) no options shall be granted during the period of 60 days immediately preceding the publication date of the annual results or, if shorter, the period from the end of the relevant financial year up to the publication date of the results; and

(iv) during the period of 30 days immediately preceding the publication date of the quarterly results (if any) and half-year results or, if shorter, the period from the end of the relevant quarterly or half-year period up to the publication date of the results.

(i) Rights are personal to grantee

An option and an offer to grant an option shall be personal to the grantee and shall not be transferable or assignable. No grantee shall in any way sell, transfer, charge, mortgage, encumber or create any interest (legal or beneficial) in favour of any third party over or in relation to any option held by him or her or any offer relating to the grant of an option made to him or her or attempt so to do (save that the grantee may nominate a nominee in whose name our Shares issued pursuant to the Share Option Scheme may be registered). Any breach of the foregoing shall entitle our Company to cancel any outstanding options or any part thereof granted to such grantee.

(j) Time of exercise of option and duration of the Share Option Scheme

An option may be exercised in accordance with the terms of the Share Option Scheme at any time after the date upon which the option is deemed to be granted and accepted and prior to the expiry of 10 years from that date. The period during which an option may be exercised will be determined by the Board in its absolute discretion, save that no option may be exercised more than 10 years after it has been granted. No option may be granted more than 10 years after the [REDACTED]. Subject to earlier termination by our Company in general meeting or by the Board, the Share Option Scheme shall be valid and effective for a period of 10 years from the [REDACTED].

(k) Performance target

A grantee may be required to achieve any performance targets as the Board may then specify in the grant before any options granted under the Share Option Scheme can be exercised.

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(l) Rights on ceasing employment or death

If the grantee of an option ceases to be an employee of our Company or any of its subsidiaries

(i) by any reason other than death or termination of his or her employment on the grounds specified in paragraph (m) below, the grantee may exercise the option up to the entitlement of the grantee as at the date of cessation (to the extent not already exercised) within a period of one month from such cessation; or

(ii) by reason of death, his or her personal representative(s) may exercise the option within a period of 12 months from such cessation, which date shall be the last actual working day with our Company or the relevant subsidiary whether salary is paid in lieu of notice or not, failing which it will lapse.

(m) Rights on dismissal

If the grantee of an option ceases to be an employee of our Company or any of its subsidiaries on the grounds that he has been guilty of serious misconduct, or in relation to an employee of our Group (if so determined by the Board) on any other ground on which an employee would be entitled to terminate his or her employment at common law or pursuant to any applicable laws or under the grantee’s service contract with our Group, or has been convicted of any criminal offence involving his or her integrity or honesty, his or her option will lapse and not be exercisable after the date of termination of his or her employment.

(n) Rights on takeover

If a general offer is made to all our Shareholders (or all such Shareholders other than the offeror and/or any person controlled by the offeror and/or any person acting in concert with the offeror (as defined in the Takeovers Codes)) and such offer becomes or is declared unconditional during the option period of the relevant option, the grantee of an option shall be entitled to exercise the option in full (to the extent not already exercised) at any time within 14 days after the date on which the offer becomes or is declared unconditional.

(o) Rights on winding-up

In the event a notice is given by our Company to its members to convene a general meeting for the purposes of considering, and if thought fit, approving a resolution to voluntarily wind-up our Company, our Company shall forthwith give notice thereof to all grantees and thereupon, each grantee (or his or her legal personal representative(s)) shall be entitled to exercise all or any of his or her options (to the extent not already exercised) at any time not later than two business days prior to the proposed general meeting of our Company referred to above by giving notice in writing to our Company, accompanied by a remittance or payment for the full amount of the aggregate subscription price for our

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Shares in respect of which the notice is given, whereupon our Company shall as soon as possible and, in any event, no later than the business day immediately prior to the date of the proposed general meeting, allot the relevant Shares to the grantee credited as fully paid and register the grantee as holder thereof.

(p) Rights on compromise or arrangement between our Company and its members or creditors

If a compromise or arrangement between our Company and its members or creditors is proposed for the purposes of a scheme for the reconstruction of our Company or its amalgamation with any other companies pursuant to the laws of jurisdictions in which our Company was incorporated, our Company shall give notice to all the grantees of the options on the same day as it gives notice of the meeting to its members or creditors summoning the meeting to consider such a scheme or arrangement and any grantee may by notice in writing to our Company accompanied by a remittance or payment for the full amount of the aggregate subscription price for our Shares in respect of which the notice is given (such notice to be received by our Company not later than two business days prior to the proposed meeting), exercise the option to its full extent or to the extent specified in the notice and our Company shall as soon as possible and in any event no later than the business day immediately prior to the date of the proposed meeting, allot and issue such number of Shares to the grantee which falls to be issued on such exercise of the option credited as fully paid and register the grantee as holder thereof.

With effect from the date of such meeting, the rights of all grantees to exercise their respective options shall forthwith be suspended. Upon such compromise or arrangement becoming effective, all options shall, to the extent that they have not been exercised, lapse and determine. If for any reason such compromise or arrangement does not become effective and is terminated or lapses, the rights of grantees to exercise their respective options shall with effect from such termination be restored in full but only upon the extent not already exercised and shall become exercisable.

(q) Ranking of Shares

Our Shares to be allotted upon the exercise of an option will not carry voting dividend or other rights until completion of the registration of the grantee (or any other person nominated by the grantee) as the holder thereof. Subject to the aforesaid, Shares issued and allotted on the exercise of options shall be subject to the provisions of the Memorandum and articles of association of the Company will carry the same rights in all respects and shall have the same voting, dividend, transfer and other rights, including those arising on liquidation as attached to the other fully-paid Shares in issue on the date of issue and rights in respect of any dividend or other distributions paid or made on or after the date of issue. For the avoidance of doubt, Shares issued upon the exercise of an Option shall not be entitled to any rights attaching to Shares by reference to a record date preceding the date of allotment.

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(r) Effect of alterations to capital

In the event of any alteration in the capital structure of our Company whilst any option may become or remains exercisable, whether by way of capitalisation issue, rights issue, open offer (if there is a price dilutive element), consolidation, sub-division or reduction of share capital of our Company, or otherwise howsoever, such corresponding alterations (if any) shall be made in the number or nominal amount of Shares subject to any options so far as unexercised and/or the subscription price per Share of each outstanding option as the auditors of our Company or an independent financial advisor shall certify in writing to the Board to be in their/his/her opinion fair and reasonable in compliance with Rule 17.03(13) of the Listing Rules and the note thereto and the supplementary guidance issued by the Stock Exchange on 5 September 2005 and any future guidance and interpretation of the Listing Rules issued by the Stock Exchange from time to time and the note thereto. The capacity of the auditors of our Company or the approval independent financial advisor, as the case may be, in this paragraph is that of experts and not arbitrations and their certificate shall, in absence of manifest error, be final and conclusive and binding on our Company and the grantees.

Any such alterations will be made on the basis that a grantee shall have the same proportion of the issued share capital of our Company for which any grantee of an option is entitled to subscribe pursuant to the options held by him before such alteration and the aggregate subscription price payable on full exercise of any option is to remain as nearly as possible the same (and in any event not greater than) as it was before such event. No such alteration will be made the effect of which would be to enable a Share to be issued at less than its nominal value. The issue of securities as consideration in a transaction is not to be regarded as a circumstance requiring any such alterations.

(s) Expiry of option

An option shall lapse automatically and not be exercisable (to the extent not already exercised) on the earliest of:

(i) the date of expiry of the option as may be determined by the Board;

(ii) the expiry of any of the periods referred to in paragraphs (l), (m), (n), (o) or (p);

(iii) the date on which the scheme of arrangement of our Company referred to in paragraph (p) becomes effective;

(iv) subject to paragraph (o), the date of commencement of the winding-up of our Company;

(v) the date on which the grantee ceases to be an Eligible Participant by reason of such grantee’s resignation from the employment of our Company or any of our subsidiaries or the termination of his or her employment or contract on any one or more of the grounds that he or she has been guilty of serious

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misconduct, or has been convicted of any criminal offence involving his or her integrity or honesty, or in relation to an employee of our Group (if so determined by the Board), or has been insolvent, bankrupt or has made compositions with his or her creditors generally or any other ground on which an employee would be entitled to terminate his or her employment at common law or pursuant to any applicable laws or under the grantee’s service contract with our Group. A resolution of the Board to the effect that the employment of a grantee has or has not been terminated on one or more of the grounds specified in this paragraph shall be conclusive; or

(vi) the date on which the Board shall exercise our Company’s right to cancel the option at any time after the grantee commits a breach of paragraph (i) above or the options are cancelled in accordance with paragraph (u) below.

(t) Alteration of the Share Option Scheme

The Share Option Scheme may be altered in any respect by resolution of the Board except that:

(i) any alteration to the advantage of the grantees or the Eligible Participants (as the case may be) in respect of the matters contained in Rule 17.03 of the Listing Rules; or

(ii) any material alteration to the terms and conditions of the Share Option Scheme or any change to the terms of options granted, shall first be approved by our Shareholders in general meeting provided that if the proposed alteration shall adversely affect any option granted or agreed to be granted prior to the date of alteration, such alteration shall be further subject to the grantees’ approval in accordance with the terms of the Share Option Scheme. The amended terms of the Share Option Scheme shall still comply with Chapter 17 of the Listing Rules and any change to the authority of the Board in relation to any alteration to the terms of the Share Option Scheme must be approved by Shareholders in general meeting.

(u) Cancellation of options

Subject to paragraph (i) above, any cancellation of options granted but not exercised must be approved by the grantees of the relevant options in writing. For the avoidance of doubt, such approval is not required in the event any option is cancelled pursuant to paragraph (m).

(v) Termination of the Share Option Scheme

Our Company may by resolution in general meeting or the Board at any time terminate the Share Option Scheme and in such event no further option shall be offered but the provisions of the Share Option Scheme shall remain in force to the extent necessary to give effect to the exercise of any option granted prior thereto or otherwise as may be required in accordance with the provisions of the Share Option Scheme. Options granted

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prior to such termination but not yet exercised at the time of termination shall continue to be valid and exercisable in accordance with the Share Option Scheme.

(w) Administration of the Board

The Share Option Scheme shall be subject to the administration of the Board whose decision as to all matters arising in relation to the Share Option Scheme or its interpretation or effect (save as otherwise provided herein) shall be final and binding on all parties.

(x) Conditions of the Share Option Scheme

The Share Option Scheme shall take effect subject to and is conditional upon:

(i) the passing of the necessary resolutions by our Shareholders to approve and adopt the rules of the Share Option Scheme;

(ii) the Stock Exchange granting the approval for the [REDACTED]ofand permission to deal in, our Shares which may fall to be issued pursuant to the exercise of options to be granted under the Share Option Scheme;

(iii) the obligations of the [REDACTED] under the [REDACTED] becoming unconditional (including, if relevant, as a result of the waiver(s) of any such condition(s) by the [REDACTED] (on behalf of the [REDACTED])) and not being terminated in accordance with the terms of the [REDACTED]or otherwise;

(iv) the commencement of dealings in our Shares on the Stock Exchange.

If the conditions in paragraph (x) above are not satisfied within two calendar months from the adoption date:

(v) the Share Option Scheme shall forthwith determine;

(vi) any option granted or agreed to be granted pursuant to the Share Option Scheme and any offer of such a grant shall be of no effect; and

(vii) no person shall be entitled to any rights or benefits or be under any obligations under or in respect of the Share Option Scheme or any option granted thereunder.

(y) Disclosure in annual and interim reports

Our Company will disclose details of the Share Option Scheme in its annual and interim reports including the number of options, date of grant, exercise price, exercise period and vesting period during the financial year/period in the annual/interim reports in accordance with the Listing Rules in force from time to time.

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(z) Present status of the Share Option Scheme

As at the Latest Practicable Date, no option had been granted or agreed to be granted under the Share Option Scheme.

Application has been made to the Stock Exchange for the granting of the approval for the [REDACTED] of and permission to deal in our Shares which may fall to be issued pursuant to the exercise of the options to be granted under the Share Option Scheme, being [REDACTED] Shares in total.

E. OTHER INFORMATION

1. Tax and other indemnities

Our Controlling Shareholders have entered into the Deed of Indemnity with and in favour of our Company (for ourselves and as trustee for each of our subsidiaries) to provide indemnities on a joint and several basis in respect of, among other matters, (i) taxation or taxation claims resulting from income, profits or gains earned, accrued or received, any late charges and penalties incurred as a result of tax filing matters as well as any estate duty to which any member of our Group may be subject and payable on or before the [REDACTED], and (ii) any non-compliance with applicable regulations in Hong Kong, PRC and other relevant jurisdictions by any Group member on or before the date when the [REDACTED] becomes unconditional, including but not limited to the overdue contributions and any late charges and penalties imposed by the relevant authorities resulting from any insufficient contribution to social insurance and housing provident fund during the Track Record Period as disclosed in “Business—Legal Proceedings and Compliance—Historical Non-Compliance Incident”, save, among others, (a) to the extent that specific provision or reserve has been made for such taxation in the audited combined financial statements of our Group as set out in Appendix I; (b) to the extent that the liability for such taxation would not have arisen but for any act or omission of, or delay by, any member of our Group after the [REDACTED]; and (c) to the extent such loss arises or is incurred only as a result of a retrospective change in law or regulations or the interpretation or practice thereof by any relevant authority coming into force after the [REDACTED].

2. Litigation

As at the Latest Practicable Date, no member of our Group was engaged in any litigation or arbitration of material importance and, so far as our Directors are aware, no litigation or claim of material importance is pending or threatened by or against any member of our Group.

3. Sole Sponsor

The Sole Sponsor satisfies the independence criteria applicable to sponsor set out in Rule 3A.07 of the Listing Rules. The Sole Sponsor will receive an aggregate fee of HK$4.2 million for acting as the sponsor for the [REDACTED].

The Sole Sponsor has made an application on our Company’s behalf to the Stock Exchange for the granting of the approval for the [REDACTED] of, and permission to deal in, all the Shares in issue and to be issued as mentioned in this document.

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All necessary arrangements have been made for the Shares to be admitted into [REDACTED].

4. Preliminary expenses

The preliminary expenses incurred and paid by our Company relating to the incorporation of our Company were approximately US$5,399.58.

5. No material adverse change

Saved as disclosed in the sections headed “Summary” and “Financial Information” in this document, our Directors confirm that there has been no material adverse change in our Group’s financial or trading position since 31 December 2020 (being the date on which the latest audited combined financial information of our Group was prepared).

6. Promoter

Our Company has no promoter. 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.

7. Taxation of holders of Shares

(a) Hong Kong

The sale, purchase and transfer of Shares registered with our Company’s Hong Kong branch register of members will be subject to Hong Kong stamp duty, the current rate charged on each of the purchaser and seller is [0.13]% of the consideration or, if higher, the fair value of the Shares being sold or transferred. Profits from dealings in the Shares arising in or derived from Hong Kong may also be subject to Hong Kong profits tax.

(b) Cayman Islands

Under the present Cayman Islands law, there is no stamp duty payable in the Cayman Islands on transfer of Shares.

Intending holders of the Shares are recommended to consult their professional advisors if they are in doubt as to the taxation implications of holding or disposing of or dealing in the Shares. It is emphasised that none of our Company, our Directors or the other parties involved in the [REDACTED] will accept responsibility for any tax effect on, or liabilities of, holders of Shares resulting from their holding or disposal of or dealing in Shares or exercise of any rights attaching to them.

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8. Qualifications and consents of experts

The following are the qualifications of the experts who have given opinions or advice which are contained in this document:

Name Qualifications

CEB International Capital Licensed to conduct Type 1 (dealing in Corporation Limited securities), Type 4 (advising on securities) and Type 6 (advising or corporate finance) regulated activities under the SFO

Grant Thornton Hong Kong Certified public accountants

Harney Westwood & Riegels Legal advisors to our Company as to Cayman Islands law

Commerce & Finance Law Legal advisors to our Company as to the PRC Offices law

China Index Academy Industry consultant

Zhitong (Fujian) Registered Tax Tax advisors Agents Co., Ltd.

Each of the experts named above has given and has not withdrawn its written consent to the issue of this document with the inclusion of its reports, letters, opinions, summaries of opinions and/or references to its names included herein in the form and context in which they respectively appear.

9. Interests of experts in our Company

None of the persons named in the paragraph headed “—8. Qualifications and consents of experts” above 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. Binding effect

This document shall have the effect, in an application is made in pursuance of it, 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 so far as applicable.

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11. Miscellaneous

(a) Within the two years immediately preceding the date of this document:

(i) save as disclosed in the section headed “History, Reorganisation and Corporate Structure” in this document, no share or loan capital of our Company or any of our subsidiaries has been issued or agreed to be issued fully or partly paid either for cash or for 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 in connection with the issue or sale of any capital of our Company or any of our subsidiaries; and

(iv) no commission has been paid or payable subscribing, agreeing to subscribe or procuring subscription or agreeing to procure subscription for any shares in our Company or any of our subsidiaries;

(b) no founder, management or deferred Shares nor any debenture in our Company or any of our subsidiaries have been issued or agreed to be issued;

(c) 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) the principal register of members of our Company will be maintained in the Cayman Islands by Harneys Fiduciary (Cayman) Limited and a branch register of members of our Company will be maintained in Hong Kong by Computershare Hong Kong Investor Services Limited. Unless our Directors otherwise agree, all transfer and other documents of title of Shares must be lodged for registration with and registered by our Company’s share register in Hong Kong and may not be lodged in the Cayman Islands. All necessary arrangements have been made to enable the Shares to be admitted to [REDACTED];

(e) no company within our Group is presently [REDACTED] on any stock exchange or traded on any trading system;

(f) our Directors have been advised that under Cayman Islands Companies Act the use of a Chinese name by our Company does not contravene the Cayman Islands Companies Act;

(g) there is no arrangement under which future dividends are waived or agreed to be waived;

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(h) our Company has no outstanding convertible debt securities or debentures; and

(i) there is no restriction affecting the remittance of profits or repatriation of capital into Hong Kong and from outside Hong Kong.

12. Bilingual document

The English language 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). In case of any discrepancies between the English language version and Chinese language version of this document, the English language version shall prevail.

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DOCUMENTS DELIVERED TO THE REGISTRAR OF COMPANIES IN HONG KONG

The documents attached to the copy of this Document 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 the paragraph headed “E. Other Information—8. Qualifications and consents of experts” in Appendix IV to this document; and

(c) a copy of each of the material contracts referred to in the paragraph headed “B. Further Information about our Business—1. Summary of material contracts” in Appendix IV to this document.

DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents will be available for inspection at the offices of Sidley Austin at Level 39, 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 Memorandum of Association and the Articles of Association;

(b) the Accountant’s Report from Grant Thornton Hong Kong Limited, the text of which is set out in Appendix I to this Document;

(c) the report from Grant Thornton Hong Kong Limited 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 combined financial statements of our Group for the financial years ended 31 December 2018, 2019, 2020;

(e) the legal opinion issued by Commerce & Finance Law Offices, the PRC Legal Advisors in respect of our Group’s business operations and property interests in the PRC;

(f) the letter of advice from Harney Westwood & Riegels, our Cayman legal advisors, summarising certain aspects of the Cayman Islands company law referred to in the section headed “Summary of the Constitution of the Company and Cayman Islands Companies Law” in Appendix III to this document;

(g) the industry report prepared by China Index Academy, the industry consultant;

(h) the tax opinion prepared by Zhitong (Fujian) Registered Tax Agents Co., Ltd., the tax advisors;

(i) the Companies Act;

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(j) the material contracts referred to in the paragraph headed “B. Further Information about our Business—1. Summary of material contracts” in Appendix IV to this document;

(k) the service contracts and letters of appointment with each of our Directors referred to in the paragraph headed “C. Further Information about our Directors and Substantial Shareholders—1. Directors—(b) Particulars of service contracts and letters of appointment” in Appendix IV to this document;

(l) the written consents referred to in the paragraph headed “E. Other Information—8. Qualifications and consents of experts” in Appendix IV to this document; and

(m) the terms of the Share Option Scheme.

–V-2–