14 February 2018

CFSG Daily Comment

Today ’s Forecast Market Outlook HSI trading range 29,700-30,100 points HSI might fluctuate at around 29,700 and 30,100 points today. Market focus Baic Motor (01958) The Hang Seng Index opened higher by 390 points yesterday. Afterwards, the HTSC (06886) market extended its gains and increased 709 points at most to reach its intra-day Hopewell Hold (00054) high of 30,169 points. During the afternoon session, the HK stocks significantly narrowed its gains to 323 points. The HSI finally closed at 29,839.53 points, up HK and Regional Markets 379.90 points or 1.29%. Market turnover amounted to HKD128.802 billion. The ADR Close (last trading day) Up(down) proportional HSI index closed overnight at 30,067 points with 227 points higher than Hang Seng Index 29,839.53 1.29% closing price yesterday. Investors adopted ‘wait and see’ attitude towards the CPI HSCEI 12,004.51 0.88% data to be released on Wednesday. Dow was up slightly by 39 points to 24,640 CCI 4,354.53 1.14% points. HSI may fluctuate at around 29,700 to 30,100 points today. DJIA 24,640.45 0.16% Nasdaq 7,013.51 0.45% UK FTSE 7,168.01 (0.13%) Sector and Company News France CAC 5,109.24 (0.60%) Germany DAX 12,196.50 (0.70%) ¢ BAIC Motor (01958) released a profit warning that the net profit attributable to the Shanghai A 3,335.69 0.98% equity holders of the Company for the year ended 31 December 2017 is expected Shanghai B 322.90 0.71% to decrease by approximately 65% as compared with the corresponding period in 2016. Shanghai -HK stock connect ¢ Guorui PPT (02329) announced that in January 2018, the group achieved Daily Quota Bal. % contracted sales of approximately RMB788 million, the contracted sales in terms Northbound 12.962 billion 99.71% of gross floor area amounted to approximately 58,100 sq.m. and contracted Southbound - - average selling price amounted to approximately RMB13,600 per sq.m.. ¢ (00753) released its key operating data of January 2018 that the number Shenzhen -HK stock connect of passengers carried grew 2.1% YoY or 0.5% MoM to 8.5903 million. Daily Quota Bal. % ¢ China East Air (00670) announced the operating data for January 2018 that the Northbound 13.839 billion 106.46% number of passengers carried reached 9.1068 million, up 2% YoY. Southbound - - ¢ Smartone Tele (00315) announced the interim results as of the end of December 2017. During the period, its turnover dropped 23.54% YoY to HKD4.108 billion, Hang Seng Composite Industry Ind ice s while the net profit dropped 16.59% YoY to HKD328 million. An interim dividend of Close (last trading day) Up(down) HK18 cents was declared. Energy 8,703.30 0.16% Materials 6,908.44 1.78% Consumer Goods 5,754.78 1.86% Today’s A -share Snapshot Services 4,387.02 1.78%

Telecommunications 1,564.18 (0.61%) SINOMATECH (002080.SZ) Market Cap: 17.35 billion Financials 4,298.37 1.23% Properties & Valuation Financial Highlight (FY 201 6) Construction 4,173.22 1.26% P/E P/B Turnover (“RMB billion ”) Net Profit ( “RMB billion ”) Conglomerates 2,659.47 0.78% 21.68 2.04 8.97 -2.26% 0.40 -36.32%

HSI Futures (Day Trading Session) Company’s Profile: Feb-18 Mar-18 ¢ The Company is mainly engaged in the R&D, manufacture and distribution of wind Open (last trading day) 29,678 29,658 power blade, glass fiber products, lithium battery separator, high-pressure Close (last trading day) 29,690 29,686 Up (down) 268 272 composite cylinder, filter material and other composite materials. Day High 30,089 30,083 Brief Comments: Day Low 29,622 29,620 Settled volume 178,426 3,623 - Business catalysts Change in OI (5,409) 1,281 ¢ The Company announced that it and Sinoma-int (600970.SH) proposed to establish a subsidiary in Vietnam with the investment of USD3.8 million, which will Foreign Exchange build the separator production base with the annual output of 48 million tons in Latest Price Dong Nai, Vietnam. The Company planned to hold 51% shares. The total USD/JPY 107.7800 investment of the project amounted to USD125.274 billion. This is expected to be EUR/USD 1.2352 beneficial for the Company to further expand its overseas market share and GBP/USD 1.3885 AUD/USD 0.7865 increase its profitability in separator industry. USD/CAD 1.2585 ¢ According to the Company’s preliminary earnings estimate for FY2017, the USD/SWF 0.9351 turnover rose 14.67% YoY to RMB10.285 billion and the net profit hiked by 101.60% YoY to RMB809 million. Such increase in net profit was attributable to the increasing price and expanding capacity of glass fiber products, the extending market share in blade industry and the profit from composite cylinder business. - Risk factors ¢ The market demand of wind power blade is affected by the possible adjustment of the related industrial policies significantly, and the market competition in glass fiber industry is becoming fiercer; which are expected to put a drag on the Company’s core businesses.

The above information is provided and distributed by CASH Financial Services Group Limited ( “CASH ”). The document is for reference only. Neither the information nor opinion expressed shall be construed, expressly or impliedly, as an advice, offer, invitation, advertisement, inducement, recommendation or representation o f any kind or form whatsoever. While the information contained herein has been obtained from sources believed to be reliable, CASH or its affiliates do not represent that it is accurate or complete and it should be relied upon. CASH hereby expressly discla ims all liabilities arising out of or incidental to the accuracy and completeness of the contents and information herein contained. The contents and information in this document is subject to change without prior notice to you. Trade in securities covered by this report may be made only in those jurisdictions where the securities are qualified for trading. This document may not in whole or in part be reproduced or furnished to any person other than the addressee without written consent from CASH and CASH shall not be liable to any such third parties for loss arising from any unauthorized distribution. Securities dealing services are provided by Celestial Securities Limited, a corporation licensed to conduct Type 1 (dealing in securities) regulated activity under the Securities and Futures Ordinance. - 1 - 2014 年 10 月 3 日 (星期五) >> 每日通訊 14 February 2018

CFSG Daily Comment

Fosun Pharma (02196)’s Profile Stock Pick A/ (Code: 600196.SH) Stock Category #* Joint with Kite Pharma; (02196) will Sector Pharmaceuticals Business The Company is a China-based become CAR-T drugs leader in China company, principally engaged in the research and development, ¢ Fosun Pharma was established in 1994. It is a leading healthcare group production and distribution of pharmaceuticals. in the PRC. The group’s business covers the whole healthcare industry Substantial Fosun High Tech （47.61% ） chain, including pharmaceutical manufacturing and R&D, healthcare shareholders services, medical diagnosis and devices, as well as pharmaceutical Financial Highlight distribution and retail, making contribution to improving people’s health. As at Jun 17 As at Dec 16 (in billion RMB ) 6M2017 % FY2016 % Revenue 8.277 +20.3 14.506 +16.0 ¢ In late October 2017, Fosun Pharma announced the first three quarters Net Profit 1.689 +12.6 2.806 +14.1 results ended September. It reported a net profit attributable to shareholders at RMB2.419 billion, up 11.1% yearly, with an EPS of 99 Valuation P/E 30.09x fen. P/B 3.81x Yield 0.97% ¢ On 11 Jan 2017, Fosun Pharma announced that its wholly subsidiary will

Technical Analysis form a joint venture, Fosun Pharma Kite Biotech. Co. Ltd., with Kite Direction Downward Pharma and will introduce CAR-T product KTE-C19 into China to treat 14-day RSI 46.75 lymphoma patients. Considering that Kite’s KTE-C19 has been launched Support HKD 37.62 Resistance HKD 46.69 successfully in the US with strong clinical trial record and that China is now accepting overseas clinical trial record, we believe that IND # Eligible Stock for Shanghai-HK stock connect scheme * Eligible Stock for Shenzhen-HK stock connect scheme application of Fosun Pharma Kite Biotech’s KTE-C19 in China will be approved in the coming year. Fosun Pharma will then eventually become the leader of CAR-T drugs in China.

¢ We suggest investors buy Fosun Pharma in stages at HKD45 or below to target HKD55 with a stop-loss price at HKD40.

The above information is provided and distributed by CASH Financial Services Group Limited ( “CASH ”). The document is for reference only. Neither the information nor opinion expressed shall be construed, expressly or impliedly, as an advice, offer, invitation, advertisement, inducement, recommendation or representatio n of any kind or form whatsoever. While the information contained herein has been obtained from sources believed to be reliable, CA SH or its affiliates do not represent that it is accurate or complete and it should be relied upon. CASH hereby expressly disclaims all liabilities arising out of or incidental to the accuracy and completeness of the contents and information herein contain ed. The contents and information in this document is subject to change without prior notice to you. Trade in securities covered by this report may be made only in those jurisdictions where t he securities are qualified for trading. This document may not in whole or in part be reproduced or furnished to any person other than the addressee without written consent from CASH and CASH shall not be liable to any such third parties for loss arising from any unauthorized distribution. Securities dealing services are provided by Celestial Securities Limited, a corporation license d to conduct Type 1 (dealing in securities) regulated activity under the Securities and Futures Ordinance. - 2 - 14 February 2018 >> CFSG Daily Comment

ADR HK Stock Prices Stock ADR Closing Price Adjusted Price Change from (HKEx Ticker) (US$) (HK$) HK Closing Price (%) HSBC Holdings (00005.HK) 51.68 80.436 0.584 China Life (02628.HK) 14.6 22.724 (1.484) Petrochina (00857.HK) 67.94 5.287 (0.774) CNOOC (00883.HK) 140.82 10.959 (1.462) Corp (00386.HK) 77.13 6.002 (1.982) China Mobile (00941.HK) 47.03 73.198 (1.960) (00762.HK) 12.76 9.93 (1.238) China Telecom (00728.HK) 43.69 3.4 (2.890) Huaneng Power (00902.HK) 23.95 4.66 (0.705)

A – H Comparison A-Share HKD H-Share Stock Closing Price Adjusted Price Closing Price H/A (%)* (HKEx Ticker) (RMB) (HK$) (HK$) ICBC (01398.HK) 6.8 8.41 6.55 78% (03968.HK) 30.91 38.25 32.9 86% (03988.HK) 4.28 5.30 4.24 80% Sino Corp (00386.HK) 6.34 7.85 5.99 76% Maanshan Iron (00323.HK) 4.06 5.02 3.99 79% Angang New Steel (00347.HK) 6.85 8.48 8.47 100% Jiangxi Copper (00358.HK) 18.09 22.38 12.06 54% ZTE (00763.HK) 29.74 36.80 26.3 71% Huaneng Power (00902.HK) 6.07 7.51 4.64 62% Huadian Power (01071.HK) 3.46 4.28 2.64 62% Datang Power (00991.HK) 3.72 4.60 2.25 49% China Life (02628.HK) 26.54 32.84 22.75 69% China CITIC Bank (00998.HK) 6.81 8.43 5.62 67% BOCOMM (03328.HK) 6.56 8.12 6.14 76% * > 100% ： H-Share is at a premium on its A-Share ； < 100% ： H-Share is at a discount on its A-Share

Commodities Price

Price Change Change (%)

WTI Crude Oil Futures (USD/bbl.) 59.16 (0.03) (0.05%) Brent Crude Oil Futures (USD/bbl.) 62.72 0.13 0.21% Gold 100 OZ Futures (USD/t oz.) 1,333.10 3.55 0.27% COMEX Silver Futures (USD/t oz.) 16.60 0.07 0.41% COMEX Copper Futures (USD/lb.) 316.50 0.25 0.08% Platinum Spot (USD/t oz.) 977.30 3.06 0.31%

The above information is provided and distributed by CASH Financial Services Group Limited ( “CASH ”). The document is for reference only. Neither the information nor opinion expressed shall be construed, expressly or impliedly, as an advice, offer, invitation, advertisement, inducement, recommendation or representatio n of any kind or form whatsoever. While the information contained herein has been obtained from sources believed to be reliable, CA SH or its affiliates do not represent that it is accurate or complete and it should be relied upon. CASH hereby expressly disclaims all liabilities arising out of or incidental to the accuracy and completeness of the contents and information herein contain ed. The contents and information in this document is subject to change without prior notice to you. Trade in securities covered by this report may be made only in those jurisdictions where t he securities are qualified for trading. This document may not in whole or in part be reproduced or furnished to any person other than the addressee without written consent from CASH and CASH shall not be liable to any such third parties for loss arising from any unauthorized distribution. Securities dealing services are provided by Celestial Securities Limited, a corporation license d to conduct Type 1 (dealing in securities) regulated activity under the Securities and Futures Ordinance. - 3 - 14 February 2018 >> CFSG Daily Comment

HK Treasury Yield Curve Rates 3-year 5-year 10-year 15-year Date Yield Yield Yield Yield

(%) (%) (%) (%) 01/18/18 1.498 1.687 1.986 2.159 01/19/18 1.526 1.713 2.018 2.201 01/22/18 1.545 1.736 2.038 2.227 01/23/18 1.516 1.706 1.991 2.177 01/24/18 1.494 1.675 1.946 2.134 01/25/18 1.509 1.695 1.976 2.169 01/26/18 1.492 1.664 1.931 2.129 01/29/18 1.550 1.726 2.010 2.194 01/30/18 1.512 1.719 2.010 2.210 01/31/18 1.475 1.687 1.986 2.185 02/01/18 1.517 1.729 2.027 2.217 02/02/18 1.496 1.730 2.057 2.249 02/05/18 1.493 1.738 2.100 2.297 02/06/18 1.418 1.649 1.975 2.177 02/07/18 1.426 1.654 1.975 2.177 02/08/18 1.438 1.674 2.006 2.207 02/09/18 1.435 1.665 2.014 2.211 02/12/18 1.425 1.651 2.007 2.203 02/13/18 1.395 1.611 1.989 2.179

US Treasury Yield Curve Rates 1-month 3-month 1-year 3-year 10-year 30-year Date Yield Yield Yield Yield Yield Yield

(%) (%) (%) (%) (%) (%) 01/18/18 1.290 1.630 1.790 2.430 2.620 2.900 01/19/18 1.280 1.620 1.790 2.450 2.640 2.910 01/22/18 1.270 1.650 1.790 2.460 2.660 2.930 01/23/18 1.260 1.630 1.780 2.430 2.630 2.900 01/24/18 1.250 1.630 1.790 2.430 2.650 2.930 01/25/18 1.230 1.640 1.800 2.410 2.630 2.890 01/26/18 1.240 1.640 1.800 2.470 2.660 2.910 01/29/18 1.280 1.660 1.800 2.490 2.700 2.940 01/30/18 1.490 1.660 1.880 2.510 2.730 2.980 01/31/18 1.430 1.660 1.900 2.520 2.720 2.950 02/01/18 1.410 1.640 1.890 2.560 2.780 3.010 02/02/18 1.400 1.650 1.880 2.580 2.840 3.080 02/05/18 1.400 1.670 1.850 2.500 2.770 3.040 02/06/18 1.480 1.690 1.870 2.520 2.790 3.060 02/07/18 1.360 1.730 1.910 2.570 2.840 3.120 02/08/18 1.320 1.730 1.910 2.570 2.850 3.140 02/09/18 1.310 1.730 1.890 2.520 2.830 3.140 02/12/18 1.350 1.820 1.930 2.560 2.860 3.140 02/13/18 1.340 1.800 1.950 2.540 2.830 3.110

The above information is provided and distributed by CASH Financial Services Group Limited ( “CASH ”). The document is for reference only. Neither the information nor opinion expressed shall be construed, expressly or impliedly, as an advice, offer, invitation, advertisement, inducement, recommendation or representatio n of any kind or form whatsoever. While the information contained herein has been obtained from sources believed to be reliable, CA SH or its affiliates do not represent that it is accurate or complete and it should be relied upon. CASH hereby expressly disclaims all liabilities arising out of or incidental to the accuracy and completeness of the contents and information herein contain ed. The contents and information in this document is subject to change without prior notice to you. Trade in securities covered by this report may be made only in those jurisdictions where t he securities are qualified for trading. This document may not in whole or in part be reproduced or furnished to any person other than the addressee without written consent from CASH and CASH shall not be liable to any such third parties for loss arising from any unauthorized distribution. Securities dealing services are provided by Celestial Securities Limited, a corporation license d to conduct Type 1 (dealing in securities) regulated activity under the Securities and Futures Ordinance. - 4 -