IMPORTANT If you are in any doubt about this prospectus, you should consult your stockbroker, bank manager, solicitor, professional accountant or other professional adviser. 寶 業 BAOYE 寶業集團股份有限公司 BAOYE GROUP COMPANY LIMITED* (a joint stock limited company incorporated in the People’s Republic of China with limited liability) PUBLIC OFFER AND INTERNATIONAL PLACING Number of Offer Shares : 180,684,000 H Shares (subject to the Over-allotment Option) Number of International Placing Shares : 162,612,000 H Shares (subject to reallocation and the Over-allotment Option) Number of Public Offer Shares : 18,072,000 H Shares (subject to reallocation) Offer Price : not more than HK$1.99 per H Share and expected to be not less than HK$1.25 per H Share Nominal Value : RMB1.00 per H Share Stock Code : 2355 Sponsor FIRST SHANGHAI CAPITAL LIMITED Sole Bookrunner and Joint Lead Manager FIRST SHANGHAI SECURITIES LIMITED Joint Lead Manager GC Capital (Asia) Limited Co-Lead Managers CM-CCS Securities Limited CITIC Capital Markets Limited Worldwide Finance (Securities) Limited The Stock Exchange of Hong Kong Limited and Hong Kong Securities Clearing Company Limited take no responsibility for the contents of this prospectus, 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 prospectus. A copy of this prospectus, having attached thereto the documents specified in the paragraph headed “Documents delivered to the Registrar of Companies” in Appendix V to this prospectus, has been registered by the Registrar of Companies in Hong Kong as required by section 342C of the Companies Ordinance. The Securities and Futures Commission of Hong Kong and the Registrar of Companies in Hong Kong take no responsibility for the contents of this prospectus or the documents referred to above. The Company is established, and its businesses are located, in the PRC. Potential investors in the Company should be aware of the differences in the legal, economic, and financial systems between the PRC and Hong Kong and that there are different risk factors relating to investment in PRC- incorporated companies. Potential investors should note that the regulatory framework in the PRC is different from the regulatory framework in Hong Kong, and in assessing the Company, the differences in market nature should be taken into consideration. Such risk factors and differences are set out in the section headed “Risk factors” of this prospectus and in Appendix III to this prospectus respectively. Investors should also be aware that the companies and securities regulatory framework in the PRC to which the Company is subject has only recently been introduced. The Offer Price is expected to be determined by an agreement between the Company, First Shanghai Securities (as defined in this prospectus), on behalf of the Underwriters, and the Sponsor (as defined in this prospectus) on or before 5:00 p.m. on 20 June, 2003 or such later date as may be agreed by the Company, First Shanghai Securities (on behalf of the Underwriters) and the Sponsor but in any event no later than 5:00 p.m. on 24 June, 2003. If, for any reason, the Offer Price is not agreed between the Company, First Shanghai Securities (on behalf of the Underwriters) and the Sponsor on or before 5:00 p.m. on 24 June, 2003, the Offering will not become unconditional and will lapse. The Offer Price will not be more than HK$1.99 per Offer Share and is expected to be not less than HK$1.25 per Offer Share. First Shanghai Securities (on behalf of the Underwriters) and the Sponsor, with the consent of the Company may reduce the indicative Offer Price range below that stated in this prospectus at any time prior to the morning of the latest day for lodging applications. In such case, a notice of the reduction of the indicative Offer Price range will be published in South China Morning Post (in English) and Hong Kong Economic Times (in Chinese) not later than the morning of the latest day for lodging applications under the Public Offer. If applications for Public Offer Shares have been submitted prior to the day which is the latest day for lodging applications under the Public Offer, then even if the Offer Price is so reduced, such applications cannot be subsequently withdrawn. Pursuant to the force majeure provisions contained in the Public Offer Underwriting Agreement in respect of the Offering, First Shanghai Securities, on behalf of the Public Offer Underwriters, has the right in certain circumstances, subject to the reasonable opinion of First Shanghai Securities, to terminate the obligations of the Public Offer Underwriters pursuant to the Public Offer Underwriting Agreement at any time prior to 6:00 a.m. (Hong Kong time) on the date on which dealings in the H Shares first commence on the Stock Exchange (such first dealing date is currently expected to be 30 June, 2003). Further details of the terms of the force majeure provisions are set out in the section headed “Underwriting” of this prospectus. * For identification purpose only 17 June, 2003 EXPECTED TIMETABLE 2003 (Note 1) Application lists open (Note 2) . .11:45 a.m. on Friday, 20 June Latest time to lodge white and yellow application forms . 12:00 noon on Friday, 20 June Application lists close . 12:00 noon on Friday, 20 June Expected Price Determination Time on or before . 5:00 p.m. on Friday, 20 June Announcement of the Offer Price, the level of indication of interest in the International Placing, the results of applications and the basis of allocation of the Public Offer Shares to be published in South China Morning Post (in English) and Hong Kong Economic Times (in Chinese) on or before . Wednesday, 25 June Despatch/collection of share certificates and/or refund cheques (Notes 3 to 5) . .Thursday, 26 June Dealings in the H Shares on the Stock Exchange expected to commence on . .Monday, 30 June Notes: 1. All times refer to Hong Kong local time, except as otherwise stated. Details of the structure of the Offering, including its conditions, are set out in the section headed “Structure of the Offering” of this prospectus. 2. If there is a “black” rainstorm warning or tropical cyclone warning signal number 8 or above in force in Hong Kong at any time between 9:00 a.m. and 12:00 noon on Friday, 20 June, 2003, the application lists will not open on that day. Further information is set out in the paragraph headed “Effect of bad weather on the opening of the application lists” under the section headed “How to apply for the Public Offer Shares” of this prospectus. 3. Refund cheques will be issued in respect of wholly or partially unsuccessful applications. 4. Applicants for 1,000,000 H Shares or more and who have indicated in their application forms that they wish to collect refund cheques (where applicable) and share certificates (where applicable) personally may collect refund cheques (where applicable) and share certificates (where applicable) personally from the Company’s Hong Kong share registrar, Tengis Limited, at Ground Floor, Bank of East Asia Harbour View Centre, 56 Gloucester Road, Wanchai, Hong Kong from 9:00 a.m. to 1:00 p.m. on Thursday, 26 June, 2003, or any other date notified by the Company in the newspapers as the date of despatch of share certificates/refund cheques. Applicants being individuals who opt for personal collection must not authorise any other person to make collection on their behalf. Applicants being corporations who opt for personal collection must attend by their authorised representatives bearing letters of authorisation from their corporations stamped with the corporations’ chop. Both individuals and authorised representatives must produce at the time of collection evidence of identity acceptable to Tengis Limited. 5. Uncollected share certificates and/or refund cheques will be despatched by ordinary post at the applicants’ own risk to the addresses specified in the relevant application forms shortly after 1:00 p.m. on Thursday, 26 June, 2003. For applicants who have applied for less than 1,000,000 H Shares or who have applied for 1,000,000 H Shares or more but have not indicated in the application form that he or she wishes to collect share certificates and/or refund cheques, their share certificates (if applying by using a white application form) and/or refund cheques will be sent to the address on the applicant’s application form after 1:00 p.m. on Thursday, 26 June, 2003, by ordinary post and at the applicant’s own risk. Share certificates for successful applicants who apply on yellow application forms will be deposited directly into CCASS for credit to the applicants’ CCASS investor participant stock accounts or the stock accounts of the applicants’ designated CCASS participants at the close of business on Thursday, 26 June, 2003. Further information is set out in the section headed “How to apply for the Public Offer Shares” of this prospectus. For further details of the Offering, please refer to the section headed “Information about this prospectus and the Offering” of this prospectus. 6. No temporary documents of title will be issued. Share certificates which will be issued on Thursday, 26 June, 2003 will only become valid certificates of title after 6:00 a.m. on Monday, 30 June, 2003 provided that (i) the Public Offer becomes unconditional and (ii) the right of termination as described in the paragraph headed “Grounds for termination” under the section headed “Underwriting” of this prospectus has not been exercised thereto.